Cloud growing by 25%. Are you a participant or a spectator?

Cloud is Growing at 25% a Year


Cloud is everywhere; we see, hear, and use it just about every day. It’s not just individuals, but also businesses that use cloud for almost every part of their operations. Given this scenario, it’s no surprise that the cloud market is growing at a rapid pace. But what might surprise you is the rate at which the cloud market is growing.

According to a report released by Synergy Research Group, 2016 was a bumper year for the cloud industry, as it dominated much of the IT industry. The cloud revenue for the four quarters was a whopping $148 million, signaling a 25 percent growth when compared to the same time a year before. This growth was also reflected in the revenues reported by many of the giants in cloud industry such as Amazon Web Services (AWS), Microsoft, IBM, and Google, that reported higher revenues from their cloud business.

A closer look into the report shows that out of the many cloud segments, Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) saw the highest growth  of 53 percent. This sector is dominated by Microsoft and AWS, with the former having a market share of around 11 percent while the latter is leading the pack with a market share of about 31 percent. It is estimated that AWS has the highest revenue in the segment, with numbers upwards of $13 billion, while Microsoft saw the highest growth at 124 percent. In fact, AWS was the first company to introduce cloud computing almost ten years back, so it’s only natural that it is the leading provider with a worldwide presence. Microsoft, with its strong presence in the tech industry, is fast catching up with competing products like Azure and Office 365. Other companies like Google have a market share of only around six percent, and are getting their act together to chase these two leaders.

The second highest growth among cloud sectors was seen in hosted private cloud, that grew at a rate of 35 percent. This segment is dominated by IBM and Rackspace, while the third place goes to enterprise SaaS that grew at a rate of 34 percent. Enterprise SaaS is again dominated by Microsoft, and Salesforce.

Besides giving the sector-wise breakdown, this report also show the total spending on cloud hardware and software exceeded $65 billion. Out of this, more than half of the money was spent on private cloud, though it showed that public cloud spending is also growing rapidly. Much of this revenue has come from enterprises that are looking to move their operations to the cloud, and the service providers have invested heavily in infrastructure to meet this growing demand from enterprises of all sizes. This investment is paying off in the form of higher revenues, with the report stating that more than $30 billion was generated from IaaS, PaaS, and hosted infrastructure, and another $40 billion from enterprise SaaS. Other ancillary sectors such as social networking, email, and e-commerce also added to the revenue pie.

In all, this report shows the astounding growth of cloud over the last year, and exuded much optimism for this year too.