In an era of digital transformation, the global cloud computing market has emerged as a driving force behind the technological revolution. With businesses and individuals alike seeking scalable and efficient solutions, cloud computing has become an indispensable tool. The cloud computing market continues to experience exponential growth, fueled by the need for flexible and cost-effective IT solutions. According to a report by OMR, the market is projected to grow by CAGR of 15.6% during 2022-28.
It is vital to understand market segments, factors driving growth, and challenges faced by the global cloud computing market to know recent trends and innovations driving the increase in demand, and this article will help achieve so.
Key Market Segments in Global Cloud Computing Market
Infrastructure as a Service (IaaS)
The IaaS segment remains a dominant force, offering businesses scalable and on-demand infrastructure resources. Recent data indicates that the IaaS market will grow 30% to $120.3 billion in 2022. Many firms globally are contributing to support the growth, such as-
• In June 2023, Beeks Group and IPC announced to support customer private cloud deployments for the Johannesburg Stock Exchange (JSE) to bring excellent IaaS solutions to Africa’s largest financial market.
• In November 2022, Equinix and VMware announced an expanded global relationship to deliver new digital infrastructure and multi-cloud services.
Platform as a Service (PaaS)
PaaS solutions enable developers to build, deploy, and manage applications seamlessly. The PaaS market is expected to grow by a CAGR of 26.42% during 2022-27. The leading PaaS providers are AWS (Amazon Web Services), Google Cloud Platform, Microsoft Azure, Red Hat OpenShift, and Salesforce’s Heroku.
• Zero Carbon EX officially launched a carbon-neutral PaaS one-stop service platform in November 2022.
• Boomi is named as a leader for a ninth consecutive time in Gartner® Magic Quadrant™ at the beginning of 2023 for integration platform as a service worldwide and announced various product innovations such as Rapid API Creation, FedRAMP Authorization, and IRAP Assessment.
Software as a Service (SaaS)
SaaS applications have gained immense popularity due to their accessibility and ease of use. The SaaS market is anticipated to expand at a CAGR of 13.7% during 2023-30.
• SolarWinds, a leading provider of simple, powerful, and secure IT management software, announced an expansion for the global reach of its full-stack, software as a service (SaaS) SolarWinds® Observability solution with the opening of a new data center in Europe in February 2023.
• IBS Software, a leading SaaS provider, has acquired Accenture Freight and Logistics Software (AFLS), which provides technology platforms to help airline and ocean transportation companies manage freight operations.
Factors Driving Growth of Global Cloud Computing Market
Technological Collaboration
The global technological collaboration happening between big IT companies has accelerated cloud adoption. Companies require secure and accessible platforms to facilitate seamless collaboration and remote operations and to provide a seamless experience. Many organizations are extending their services by collaborating, such as.
• Infosys expands its partnership with Microsoft to drive cloud transformation in February 2023. It will significantly benefit enterprises by bringing Infosys Cobalt cloud offerings and Microsoft's cloud computing technologies, led by Azure, across the business value chain.
AI and IoT Integration
Integrating cloud computing with artificial intelligence (AI) and the Internet of Things (IoT) has unlocked new avenues for innovation. Edge computing, a facet of cloud computing, IoT devices generate enabling real-time processing and analysis of data.
• Microsoft and Snowflake bring generative AI to data cloud services to boost their strategies and collaboration, taking joint solutions directly to customers.
• Ennoconn to integrate its Digitalization-as-a-Service strategy with Google's advanced cloud solutions and services to create next-gen digital industrial products and new revenue models.
Competitive Landscape
The global cloud computing market is marked by intense competition among major players, including Amazon Web Services (AWS), Microsoft Azure, Google Cloud, and IBM Cloud. These players are investing in expanding their service portfolios, enhancing security features, and establishing data centers strategically to cater to diverse customer needs.
• According to Microsoft’s recent data, its new data center in Mexico is set to start operations by the end of 2023. This expansion was a part of Microsoft’s $1.1 billion investment plan to establish the first cloud region in Mexico.
• In September 2022, Alibaba Cloud unveiled its plans to expand its cloud operations in the APAC (Asia-Pacific) region by investing around $1 billion in cloud technology.
• In November 2022, Huawei, which serves Thailand and Malaysia, is investing $300 million to expand its cloud base in Indonesia.
In November 2022, AWS launched its cloud infrastructure in Spain to allow organizations of all sizes in the region to fast-track innovation, speed up business processes, and offer customers better experiences.
The global cloud computing market continues to redefine how businesses operate and innovate in the digital age. The market's growth trajectory remains impressive, with various services catering to diverse needs. As technology evolves and new challenges arise, the cloud computing industry will undoubtedly adapt, setting the stage for a dynamic and transformative future.
However, despite advancements in cloud security, data breaches and cyber threats remain a primary concern for businesses. Ensuring robust encryption, authentication, and access controls is paramount. Also, as data privacy regulations evolve, companies operating across borders must navigate complex compliance requirements. Cloud service providers are continuously enhancing their compliance frameworks to address these concerns. There is a broader scope to continue the research to resolve the challenges and increase seamless customer experience in the global cloud computing market.