Public cloud services spending will more than double by 2023

28th August 2019, von in SYNAXON UK News

Worldwide spending on public cloud services and infrastructure will more than double between now and 2023, according to the latest update to the International Data Corporation (IDC) Worldwide Semi-annual Public Cloud Services Spending Guide. With a five-year compound annual growth rate (CAGR) of 22.3%, public cloud spending will grow from $229 billion in 2019 to nearly $500 billion in 2023.

“Adoption of public (shared) cloud services continues to grow rapidly as enterprises, especially in professional services, telecommunications, and retail, continue to shift from traditional application software to software as a service (SaaS) and from traditional infrastructure to infrastructure as a service (IaaS) to empower customer experience and operational-led digital transformation (DX) initiatives,” said Eileen Smith, program director, Customer Insights and Analysis.

Software as a Service (SaaS) will be the largest category of cloud computing, capturing more than half of all public cloud spending in throughout the forecast. SaaS spending, which is comprised of applications and system infrastructure software (SIS), will be dominated by applications purchases. The leading SaaS applications will be customer relationship management (CRM) and enterprise resource management (ERM). SIS spending will be led by purchases of security software and system and service management software.

Infrastructure as a Service (IaaS) will be the second largest category of public cloud spending throughout the forecast, followed by Platform as a Service (PaaS). IaaS spending, comprised of servers and storage devices, will also be the fastest growing category of cloud spending with a five-year CAGR of 32.0%. PaaS spending will grow nearly as fast (29.9% CAGR) led by purchases of data management software, application platforms, and integration and orchestration middleware.

Three industries – professional services, discrete manufacturing, and banking – will account for more than one third of all public cloud services spending throughout the forecast. While SaaS will be the leading category of investment for all industries, IaaS will see its share of spending increase significantly for industries that are building data and compute intensive services. For example, IaaS spending will represent more than 40% of public cloud services spending by the professional services industry in 2023 compared to less than 30% for most other industries. Professional services will also see the fastest growth in public cloud spending with a five-year CAGR of 25.6%.

Devices in decline – but there is still Windows 10 upgrade potential this year 

Gartner says that global device shipments will decline in 2019 with worldwide shipments of PCs, tablets and mobile phones totalling 2.2 billion units – down 3.3% year-on-year.

Although worldwide PC shipments totalled 63 million units and grew 1.5% in nQ2 2019, shipments for the full year are estimated to total 257 million units, a 1% decline from 2018. The ongoing trade dispute between the US and China is expected to impact the market.

However, there was also a strong Windows 10 migration among in Q2 2019 and Gartner expects that 75% of the business PC installed base will have migrated to Windows 10 by the beginning of 2021. Sales of ‘premium’ ultra-mobiles are also be expected to rise.

The mobile phone market is set to fall by 3.8%, with this year’s 1.7 billion shipments already 10% below the 1.9 billion reached in 2015. They will, however, recover a little over the next two years.

Gartner also noted that 5G phone sales will represent 6% of the market in 2020 and reach 51% by 2023. It also predicts that high-end phone life span will increase from 2.6 years to nearly 2.9 years through 2023.

Survey shows SMBs prioritising tech investment

Adecco the leading provider of workforce solutions, has published research that reveals more business owners prioritise investing in technology (52%) over upskilling (24%) their workforce.

The firm surveyed 500 managers, directors, and business owners at SMEs for the People, Technology and the Future of Upskilling, report.

The majority of businesses (94%) recognise that technology is transforming the skills their company needs over the next three years. It was revealed that middle managers (43%) are more likely than business owners (35%) to think that technology will require increased training and development for the workforce. Worryingly, 43% of businesses admit that they’re unable to provide relevant training due to budget restrictions.

When it comes to the benefits of technology on the workforce, nearly half (41%) of middle managers agree that it will increase flexibility; while only 28% of business owners believe this. Adecco’s 2016 humans vs robots research revealed that the majority of UK workers (71%) agree with middle managers that AI will allow them to be more flexible and organised with their time.

Business owners believe that the key benefits of technology on their workforce in the next three years will include increased productivity (43%); and that employees will be able to do their jobs more efficiently (41%) and effectively (38%).

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