"Whole cloud" spending – total worldwide spending on cloud services, the hardware and software components underpinning the cloud supply chain, and the professional/managed services opportunities around cloud services – will surpass $1.3 trillion by 2025 while sustaining a compound annual growth rate (CAGR) of 16.9%, according to International Data Corporation (IDC).
"In today's digital-first world, business outcomes and innovation are increasingly tied to the ability to develop and use innovative technologies and services anywhere, as quickly as possible. Cloud is the foundation for meeting this need," said Rick Villars, group vice president, Worldwide Research at IDC. "Entire industries want to intelligently leverage data to their advantage and can do so because they have faster access to digital technologies built on a cloud foundation."
IDC's forecast looks at both shared (public) cloud services and dedicated (private) cloud services. These are defined as follows:
- Shared (Public) cloud services are those shared among unrelated enterprises and/or consumers, open to a largely unrestricted universe of potential users, and designed for a market, not a single enterprise.
- Dedicated (Private) cloud services are delivered as subscriptions or managed service agreements provided by cloud, colocation, outsourcing, or managed service providers to their enterprise customers.
Shared (Public) Cloud as-a-Service for infrastructure, platforms, and various software offerings continues to be the largest, and fastest increasing, engine of growth for the whole cloud market. Combined spending on shared cloud services – Infrastructure as-a-Service (IaaS), System Infrastructure Software as-a-Service (SISaaS), Platform as-a-Service (PaaS), and Software as-a-Service (SaaS) – will total $385 billion in 2021 and will see a compound annual growth rate (CAGR) of over 21.0% through 2025, reaching $809 billion.
Dedicated (Private) Cloud Services, which includes hosted private cloud services and the fast-emerging Dedicated Cloud Infrastructure–as-a-Service (DCIaaS) segment, will grow at a faster CAGR of 31.0%, but from a much smaller revenue base of $5 billion in 2021.
The as-a-Service segments of cloud spending, combining Shared Cloud as-a-Service and Dedicated Cloud as-a-Service, will account for the majority of all cloud spending throughout the forecast, growing from 55.7% in 2021 to 64.1% in 2025. These segments will also see the fastest growth in spending, with a five-year CAGR of 21.3%.
