Global public cloud spend to 17.5% in 2019

Gartner forecasts worldwide public cloud services market will grow 17.5% in 2019 to reach a total of $214.3 billion, up from $182.4 billion in 2018.

Cloud system infrastructure services, or infrastructure as a service (IaaS) is forecast to grow 27.5% in 2019 and reach $38.9 billion, up from $30.5 billion in 2018 (see Table 1). The second-highest growth rate of 21.8% will be achieved by cloud application infrastructure services, or platform as a service (PaaS).

Gartner research vice president, Sig Nag, says “we know of no vendor or service provider today whose business model offerings and revenue growth are not influenced by the increasing adoption of cloud-first strategies in organizations. What we see now is only the beginning, though. Through 2022, Gartner projects the market size and growth of the cloud services industry at nearly three time the growth of overall IT services.”

Gartner expects that by the end of 2019, more than 30% of technology providers’ new software investments will shift from cloud-first to cloud-only. This means that license-based software consumption will further plummet, while SaaS and subscription-based cloud consumption models continue their rise.

“Organizations need cloud-related services to get onboarded onto public clouds and to transform their operations as they adopt public cloud services,” said Nag. Currently almost 19% of cloud budgets are spent on cloud-related services, such as cloud consulting, implementation, migration and managed services, and Gartner expects that this rate will increase to 28% by 2022.

“As cloud continues to become mainstream within most organizations, technology product managers for cloud related service offerings will need to focus on delivering solutions that combine experience and execution with hyperscale providers’ offerings,” said Nag.

He sees the complementary approach as driving both transformation and optimization of an organization’s infrastructure and operations.