Cloud services market

Global Cloud Services market is estimated to be valued at US$ 1,207.5 Bn by 2030.

The cloud services market refers to the global marketplace where cloud service providers offer a wide range of cloud-based products and services to individuals, businesses, and organizations. It encompasses all the offerings and solutions provided through cloud computing infrastructure over the internet. The cloud services market includes various types of services such as, IaaS, PaaS, SaaS, BPaaS, and Management and Security Services. The market is driven by various factors, including the need for cost-effective and scalable computing solutions, the demand for flexibility and mobility, and the increasing adoption of digital transformation strategies by businesses. Cloud services have enables organizations to streamline their operations, improve productivity, and access advanced technologies without heavy investments in physical infrastructure.

Global Cloud Services Market: Regional Insights

The global cloud services market in North America is analyzed across the U.S. and Canada. North America has been the most attractive market for cloud computing services. North America has adopted this technology in various sectors such as healthcare, academics & education, banking & financial services and many more.

Figure 1. Global Cloud Services Market Share (%), By Region, 2023

Global Cloud Services Market- Impact of Coronavirus (COVID-19) Pandemic

With the need for virtual collaboration and remote access, cloud services experienced a surge in demand, driving substantial growth. The pandemic accelerated digital transformation efforts, leading to increased adoption of cloud-based solutions for scalability and flexibility. Cloud services became vital in supporting remote workforces, facilitating seamless communication and data access. The healthcare sector also turned to cloud solutions for telemedicine and data management during the pandemic. The pandemic’s impact on cloud services is expected to be lasting, as organizations recognize the benefits of cloud technology for future-proofing their operations.

Global Cloud Services Market- Drivers

Increase in demand for cloud services

Opting for cloud-computing service provide economic savings such as cost cutting and reduction in capital expenditures. With the use of cloud computing services, the cost incurred in the investment of physical IT resources is reduced and hence, the capital expenditure is minimized. Proper deployments of cloud services, which are private, public hybrid or community cloud, can a reliable resource for cutting overall operating expense.

According to a survey conducted by Booz Allen Hamilton, describes that deployment of cloud computing services saves up to 50 to 60% of the total cost of ownership. Another survey conducted by the CIO magazine determines the belief of the company executives regarding the deployment of cloud computing services with respect to cost cutting. According to the survey 88% of the respondents pointed towards the cost cutting benefits. With the introduction of cloud-computing services the performances of the businesses in many sectors have tremendously increased over years. The following factors contribute in elevating business performance.

• Reduced costs and proper alignment of expenditures with business needs
• Strategies and rollouts of new services to customer needs
• Increased business resilience with the facility of disaster recovery services

Cloud computing services provide an excellent return on investment, which automatically increase the business agility. According to a survey conducted by FCW (The business federal technology) 44% of the companies believe that they get quick return on investment by using cloud-computing services.

Increase in adoption of cloud in SMEs

Last few decades have shown a tremendous rise in entrepreneurs with their small and medium organizations. There is a great demand of cloud computing services due to the advantages offered such as cost cutting and business flexibility, which proves to be a boon to the startup businesses. The need for cloud computing services is rising due to the growth of these small and medium enterprises.

According to a survey conducted by Microsoft Corporation, it was observed that the small medium businesses contributed to nearly 76% in the any country’s economy. Another fact that was discovered is that 79% of entrepreneurs believed that technology could make work more enjoyable. Most of the IT enterprises in the SMB’s need the advanced technology of cloud computing services to flourish their businesses and leave their footprints in various geographies.

The cloud computing services offer various functional benefits and actively participate in the overall growth of the cloud services market. The functional benefits offered by cloud computing are no upgrading and instillation functions, operative use of IT staff and distributed resources. Eliminations of having regular upgrades and installation prove beneficial to the user as the responsibility of upgrade, patch, add on installations remains with the service provider.

Use of cloud computing services reduces the workload of the IT staff in maintaining IT infrastructure and helps them to work in other projects making more operative use of IT staff. Moreover, the resources are evenly distributed and can be used by every individual in the cloud. The use of clouds also provides recovery and backup solutions, which improve the agility of the business.

Global Cloud Services Market- Opportunities

Rise in cloud services adoption in developing regions

Cloud computing services market would find great opportunity in the developing economies such as India, China, Brazil and African economies. These countries are on the verge of development and lack in financial resources, therefore, need cost efficient solutions. In this situation, they can get a chance of saving their IT expenditures by adopting cloud computing services. With the diversified applications of the cloud computing services, small as well as the large enterprises are shifting to high technologies including cloud computing services to flourish in the future. The struggle of the developing economics to gain an advantageous position in the world is acting acts as an opportunity for the cloud computing services market.

Another region which has not embraced cloud computing technology is the UK due to its stringent regulations and trade barriers. This region has showed its unwillingness to share data with the U.S. based companies due to data security reasons. Security reasons if solved efficiently can possibly increase the market share of UK.

Solutions, applications and products (SAP) is ERP software and is used in data processing. SAP helps in enabling management tools and value added services to give a premium experience to the customers. Future reveals a ripening opportunity of SAP in cloud platform. The future benefits, which can be achieved, are virtualization of SAP technologies by collaborations. New concepts and innovations can be developed using these two technologies and single set management solutions can be developed.

Global Cloud Services Market- Trends

Increasing adoption of cloud services in BFSI industry

With the efficient use of cloud-computing lot of capital expenditure can be converted into low operational costs. This cost benefits can prove very advantageous for the BFSI sector, as the daily operation costs of banking sector are relatively higher than other sectors. The business agility and continuity with cost benefits acts as the driving force for this industry. In addition, the pay as you go benefits which are paying only for that services which the organization is using is proving to be a boon to this industry. However, due to the security concerns for the data being leaked or misused remains high in private and hybrid cloud. Due to the confidential data related to clients’ bank accounts, the best type of cloud suited for the bank operations is private cloud. The opportunity is in the insurance sector due to the need of various applications with the ability to create virtual servers.

Global Cloud Services Market- Restraints

Concerns associated with data security and protection

With many advantages cloud computing technology also caters some threats. One of the major limiting factors of the cloud computing market is securitization of confidential data. The cloud platform offers data sharing on a large scale. However, the companies hesitate to put their sensitive data on the cloud. On doing so, organization becomes vulnerable to data breaches and information loss. The hackers and the employees who cannot be trusted can cause severe damage o the company’s privacy issues. Generally the private clouds are considered to be safer than other types of clouds.

According to Logicalis, a provider of global IT solutions and managed services reveals the loss done to companies when they suffer any kind of data breaches. The fact is that 93% of the companies that suffer any kind of data loss are out of business in five years.

Most of the companies are not really sure for their data location and its jurisdiction. The actual individual responsible for the legal jurisdiction is not clear; most of the organizations are still unaware about this fact. Moreover, the data stored in the cloud is not centralized and is stored in servers, which are located in different geographies. This makes it very difficult for the organizations to track the location of their data. This creates a fear among the organizations to positively accept cloud computing services.

Cloud computing services offer software interfaces, which are used by the customers to interact with the cloud service providers. The security of the cloud computing services directly depends upon the security of these interfaces. API’s are used by the service providers for monitoring and providing value added services to the customers. The API should be protection from any external intervention.

Figure 2: Global Cloud Services Market Share (%), By Deployment Model, 2023

Global Cloud Services Market- Segmentation

Global Cloud Services Market report is segmented into Service Model, Deployment Model, Enterprise Size, and Industry Vertical

By Service Model: IaaS, PaaS, SaaS, BPaaS, and Management and Security Services

By Deployment Model: Public Cloud, Private Cloud, and Hybrid Cloud

By Enterprise Size: SMEs and Large Enterprises

By Industry Vertical: BFSI, IT & Telecommunications, Government, Retail, Healthcare, Energy & Utilities, Media & Entertainment, Manufacturing, and Others

In global Cloud Services, under Deployment Model segment, the Hybrid cloud sub-segment dominated the global market in 2023, accounting for 22.2% share in terms of value.

Global Cloud Services Market: Key Developments

Major market players are focusing on product launches, in order to enhance their product portfolio.

In February 2020, Amazon introduced capabilities into its FSx for Windows File Server and FSx for Lustre. These capabilities include enabling a user to create and use file systems in Shared Amazon Virtual Private Clouds (VPCs).

In February 2020, AWS announced 36% faster EBS-optimized performance on additional AWS Nitro System-based Amazon EC2 instances. With help of AWS Nitro System AW Scan innovate faster, further reduces cost to its customers, and delivers added benefits such as increased security and new instance types.

In March 2020, IBM announced a global alliance with Infosys to help enterprises accelerate their digital transformation journey using the IBM public cloud. The collaboration will help enterprises to transition, modernize and transform their enterprise workloads and applications by tapping into the security, open innovation and enterprise capabilities of the IBM public cloud.

In February 2020, Google Cloud opened a new cloud region based in Salt Lake City.Google Cloud today announced the opening of a new cloud region based in Salt Lake City.

Global Cloud Services Market: Key Companies Insights

Key players operating in the global Cloud Services market are ALIBABA GROUP HOLDING LIMITED, AMAZON WEB SERVICES, INC., CISCO SYSTEMS, INC., DELL, TECHNOLOGIES INC., GOOGLE LLC, HEWLETT PACKARD ENTERPRISE DEVELOPMENT LP, INTERNATIONAL BUSINESS MACHINES CORPORATION, MICROSOFT CORPORATION, ORACLE CORPORATION, and RACKSPACE HOSTING, INC.

*Definition: A Cloud service refers to any service or application that is delivered over the internet, leveraging cloud computing technology. Instead of running on local servers or devices, these services are hosted on remote servers in data centers operated by cloud service providers.

Detailed Segmentation:

• Global Cloud Services Market, By Service Model:
  • IaaS
  • PaaS
  • SaaS
  • BPaaS
  • Management and Security Services
• Global Cloud Services Market, By Deployment Model:
  • Public Cloud
  • Private Cloud
  • Hybrid Cloud
• Global Cloud Services Market, By Enterprise Size:
  • SMEs
  • Large Enterprises
• Global Cloud Services Market, By Industry Vertical:
  • BFSI
  • IT & Telecommunications
  • Government
  • Retail
  • Healthcare
  • Energy & Utilities
  • Media & Entertainment
  • Manufacturing
  • Others
• Global Cloud Services Market, By Region
  • North America
  • Europe
  • Asia Pacific
  • Latin America
  • Middle East & Africa