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The global public cloud services market is projected to reach USD 1.37 billion, at a CAGR of 22.7% between 2023 and 2028.
The market refers to the industry that provides on-demand computing resources and services over the Internet. It is projected to experience significant growth in the coming years due to the increasing adoption of cloud-based solutions by businesses. Industries such as finance, healthcare, and e-commerce are among the key adopters of public cloud services for their operations. Over 90% of businesses that use public cloud services experience cost savings compared to traditional IT infrastructure. This market analysis and report provides market size, historical data spanning from 2018 to 2022, and future projections, all presented in terms of value in USD billion for each of the mentioned segments.
| Study Period | 2024-2028 |
| Base Year For Estimation |
2023 |
| CAGR | 22.7% |
| Historic period |
2018 - 2022 |
| Fastest Growing Region |
North America at 59% |
| Largest Segment |
Services |
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Our segment comprises two primary segments, each with its respective sub-segments for further detailed analysis within specific national markets. Furthermore, our market coverage extends across geographic regions including North America, Europe, APAC, South America, and the Middle East and Africa, with comprehensive breakdowns to provide in-depth insights. The Market is witnessing a profound transformation driven by a myriad of technological advancements and market trends. AI (Artificial Intelligence) and ML (Machine Learning) technologies are at the forefront, enabling organizations to harness the power of big data and derive actionable insights. This, coupled with the adoption of cloud computing and platform as a service (PaaS) solutions, is revolutionizing the way enterprises manage and leverage data. Cloud services encompass a wide range of offerings, including cloud infrastructure services and utility-based sharing models, facilitating agile deployment and high-level computing capabilities. As organizations navigate digital business decision-making processes, considerations around data security and privacy are paramount, especially concerning protected health information (PHI) and business-sensitive data.
The market share growth by the SaaS segment will have a significant impact which contributes half of the market growth. SaaS is a cloud service model that involves the central hosting of software programs and other associated information. The hosted programs and information are accessed using a web browser over the internet. SaaS allows users to gain access to various components and features of software programs for a subscription fee.
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The SaaS segment was valued at USD 312.31 million in 2018. The use of public SaaS services is increasing due to characteristics such as elasticity and scalability that are ideal for IT-enabled services. Public SaaS offers a broad scope for data recovery. Users simply sign up to access the software as it provides the required functionality for the software program. Public SaaS also simplifies access to platform solutions such as AI, big data, information analytics, and IoT. Therefore, the demand for SaaS solutions is increasing. The factors mentioned above will drive the growth of this segment during the forecast period.
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North America is estimated to contribute 59% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. One of the major reasons for the growing demand in the US is the increased adoption of cloud computing services and a rise in information center investments. This model helps users scale resources as per the requirement, making it a viable option for start-ups and SMEs in the region.
In addition, cloud professional services market players are responsible for managing, maintaining, and developing the pool of computing resources shared among multiple tenants across a network. This model helps the sharing of resources such as storage, hardware, OS, databases, middleware, servers, and other software through virtualization. Thus, the demand for public cloud services is increasing during the forecast period.
Major players in the market include Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform.
Examples of other companies booming in the market include:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The Market is driven by a convergence of powerful technologies, including AI (Artificial Intelligence), ML (Machine Learning), and big data capabilities. These technologies empower enterprises with scalable cloud services and platform as a service (PaaS) solutions, facilitating agile deployment and high-level computing. However, challenges such as data security and privacy concerns around protected health information (PHI) and business-sensitive data persist. Adapting to technology consumerization trends and optimizing digital business decision-making processes are key to enhancing consumer experiences and overcoming challenges in data management and utility-based sharing models.
The increasing adoption of IoT, ML, and big data technologies is the key factor driving market growth. Over the last few years, hyperscalers have invested approximately USD 200 billion in capacity expansion and opening new data centers. This increase in the number of hyperscalers will have a positive impact on the global data center server market. Apart from investing in branded servers from companies such as Cisco and Dell Technologies, hyper scalers are increasingly adopting white box servers during their hardware refresh cycle. The generation of massive data has compelled several companies to build data centers of their own or collocated data center to serve their customers in a better way.
In addition, the increasing use of cloud computing is driving the demand for data centers. Therefore, various firms are investing in the launch of new information centers. Setting up a data center at an organizational level can incur huge investments. Therefore, various organizations are opting for public cloud-based storage and server services that help them avoid such investments. Such factors will increase the private and public cloud market growth during the forecast period.
Shift toward server virtualization is the primary trend shaping market growth. In the virtualization process, single physical servers or resources are divided into multiple instances using the backend-as-a-services, virtualization software, DaaS, which permits a greater number of applications to be addressed by a single server or resource. Virtualization involves increments in input/output (I/O) streams through resource pooling from multiple storage devices, which are managed through a information management console. Multiple applications can be executed on one server and adjusted for dynamic changes in usage through this approach.
Moreover, the increased server virtualization adoption can reduce the number of physical servers being used. Various service providers are providing servers and storage capacity by creating virtual instances of a single physical server. Rackspace Technology Inc. provides a virtual cloud server powered by OpenStack. Consequently, the increasing use of virtual servers will boost the growth of the market during the forecast period.
Company lock-ins and operational complexities is a major challenge that affects market growth. Company lock-in, also known as customer lock-in or proprietary lock-in, is where a customer using a product or service cannot easily transition to another Company's product or service. It can become difficult to switch public cloud service providers after all the information has been stored in the cloud platform. It becomes more difficult to switch between Companies when an application is built since the application is built using a specific platform and a set of tools.
In addition, although it is possible to switch between providers, the process can be time-consuming, labor-intensive, and expensive. Changing players may even result in rebuilding or altering an application to fit the new platform. Therefore, Company lock-ins may impede market growth during the forecast period.
This market growth and trends report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the market report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Market Customer Landscape
The public cloud services market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Million" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments.
The Market is experiencing rapid growth fueled by a multitude of factors. The IT model is shifting towards platform as a service (PaaS) and software-as-a-service (SaaS), leveraging public internet connectivity for agile deployment and utility-based sharing models. Artificial Intelligence (AI) and Machine Learning (ML), Hybrid cloud,
Automation drives high-level computing, enabling emerging technologies like smart technologies and automation. Data security and privacy are critical considerations, especially concerning protected health information (PHI) and business-sensitive data. The market caters to diverse sectors like enterprises, BFSI, media, healthcare, and telecommunications, facilitating digital transformation and next-generation technologies adoption. In the market, the integration of AI is crucial for optimizing vendor and technology choices, enhancing Video-on-Demand (VoD) services, and ensuring robust firewall protections in data centre environments, all while meeting the evolving needs of patients and adapting to the expanding DevOps platform market.
Moreover, the work-from-home model has accelerated cloud infrastructure services demand, while connected devices and smart electric vehicles usher in the era of the fourth industrial revolution. Big data analytics and telecommunications technologies underpin digital business decision-making processes in consumer experiences and media and entertainment sectors. As small & medium-sized businesses embrace digitalization, public cloud services offer scalable solutions, supported by robust security solutions like firewalls and intricate data centres. This dynamic landscape reflects a fundamental shift towards digital business and innovation, powered by the agility and scalability of public cloud services.
Furthermore, the Market is undergoing a profound transformation driven by key technological trends and market dynamics. AI (Artificial Intelligence) and ML (Machine Learning) are revolutionizing operations, enhancing efficiency, and enabling predictive analytics in various industries, including the healthcare sectors. This innovation is further accelerated by the technology consumerization trend, where end-users demand intuitive and accessible cloud-based solutions. companies and technology choices play a crucial role as organizations navigate the diverse landscape of Public Cloud Services, seeking providers that offer robust data security measures and efficient information storage capabilities. The market also witnesses significant workplace shifts, with a rising emphasis on remote work and collaboration, facilitated by Infrastructure as a Service (IaaS) and intranet solutions.
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Market Scope |
|
|
Report Coverage |
Details |
|
Page number |
179 |
|
Base year |
2023 |
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Historic period |
2018-2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 22.7% |
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Market Growth 2024-2028 |
USD 1.37 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
22.0 |
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Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
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Performing market contribution |
North America at 59% |
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Key countries |
US, China, Japan, UK, and Germany |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks, Public Cloud Services Market Industry Analysis |
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Key companies profiled |
Adobe Inc., Alphabet Inc., Amazon.com Inc., AT and T Inc., Cisco Systems Inc., Dell Technologies Inc., Fujitsu Ltd., Hewlett Packard Enterprise Co., International Business Machines Corp., Microsoft Corp., Oracle Corp., Rackspace Technology Inc., Salesforce Inc., SAP SE, ServiceNow Inc., Tencent Holdings Ltd., Verizon Communications Inc., VMware Inc., Workday Inc., and Alibaba Group Holding Ltd. |
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Market dynamics |
Parent market analysis, market forecast, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and market condition analysis for the forecast period, Public Cloud Services Market Growth Analysis |
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Customization purview |
If our public cloud services market worth report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Service
7 Market Segmentation by Type
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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