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Public Cloud Services Spending Is Being Driven by Enterprise Applications Solutions, According to IDC

.2014 – International Data Corporation (IDC) today released the latest results from the Worldwide Semiannual Public Cloud Services Tracker. For 2013, the worldwide public cloud services reached a total market size of $45.7 billion and IDC expects this market to grow at a compound annual growth rate (CAGR) of 23% until 2018.
“We are at a pivotal time in the battle for leadership and innovation in the cloud. IDC-s Public Cloud Services Tracker shows very rapid growth in customer cloud service spending across 19 product categories and within eight geographic regions. Not coincidentally, we see vendors introducing many new cloud offerings and slashing cloud pricing in order to capture market share. Market share leadership will certainly be up for grabs over the next 2-3 years,” said Frank Gens, Senior Vice President and Chief Analyst at IDC.
Three major product groups comprise the total public cloud services market in IDC-s software taxonomy: Software-as-a-Service (SaaS), Platform-as-a-Service (PaaS), and Infrastructure-as-a-Service (IaaS).
The SaaS market – accounting for 72% of the total public cloud services market and forecast to grow at a 20% CAGR over the forecast period – is dominated by Enterprise Applications cloud solutions such as enterprise resource management (ERM) and customer relationship management (CRM), followed by Collaborative applications. System Infrastructure Software cloud solutions – the other major part of the SaaS market, including Security, Systems Management, and Storage Management cloud services – drove 21% of the 2013 SaaS market. From a competitive perspective, the SaaS service provider ecosystem is largely led by Salesforce.com followed by ADP and Intuit. Traditional software vendors Oracle and Microsoft hold the 4th and 5th positions, respectively.
The PaaS market – accounting for 14% of the market in 2013 with a forecast CAGR of 27% – is composed of a wide variety of highly strategic cloud app development, deployment, and management services. In 2013 and 2014, PaaS spending has been largely driven by Integration and Process Automation solutions, Data Management solutions, and Application Server Middleware services. From a market share standpoint, the 2013 PaaS market was led by Amazon.com, followed by Salesforce.com and Microsoft (both share the number 2 position). GXS and Google hold the 4th and 5th positions, respectively.
The Infrastructure-as-a-Service (IaaS) market – comprised of two major segments, Server and Basic Storage – drove $3.6 billion in 2013 spending and is projected to grow at a 31% CAGR through 2018. The top 5 vendors in this market are Amazon.com (which holds the first position with more than 40% of market share), RackSpace, IBM, CenturyLink, and Microsoft.
On a regional basis, the United States holds almost 68% of the market which is much more than what it holds for traditional technologies. Western Europe holds 19% and the other six regions IDC tracks hold 5% or less each. However, IDC forecasts that by 2018, the U.S. share will drop to 59%, while the Western European share will grow to 23%. Emerging regions are also expected to grow above worldwide average.
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IDC-s Worldwide Semiannual Public Cloud Services Tracker provides total market size and service provider share for the 19 segments of the global public cloud market. The Tracker covers the top 80 public cloud services providers across a total of eight regional markets. Historical market size, service provider share, and forecasts are updated on a semiannual basis.
For more information about IDC-s Worldwide Semiannual Public Cloud Services Tracker, please contact Kathy Nagamine at 650-350-6423 or knagamine@idc.com.
About IDC Trackers
IDC Tracker products provide accurate and timely market size, vendor share, and forecasts for hundreds of technology markets from more than 100 countries around the globe. Using proprietary tools and research processes, IDC-s Trackers are updated on a semiannual, quarterly, and monthly basis. Tracker results are delivered to clients in user-friendly excel deliverables and on-line query tools. The IDC Tracker Charts app, available at iTunes, allows users to view data charts from the most recent IDC Tracker products on their iPhone and iPad.

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. IDC helps IT professionals, business executives, and the investment community to make fact-based decisions on technology purchases and business strategy. More than 1,000 IDC analysts provide global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. In 2014, IDC celebrates its 50th anniversary of providing strategic insights to help clients achieve their key business objectives. IDC is a subsidiary of IDG, the world-s leading technology media, research, and events company. You can learn more about IDC by visiting www.idc.com.