Skip to main content

Digital Transformation Drives Cloud Computing Demand

Digital  Business Transformation projects gained momentum in 2014, as more companies moved their legacy IT workloads to cloud computing platforms and launched a variety of new cloud-native applications. This pervasive trend will continue and accelerate for the duration of 2015.

Total cloud IT infrastructure investment (server, storage systems, and ethernet switch) is forecast to grow by 21 percent year-over-year to reach $32 billion in 2015 -- accounting for about 33 percent of all IT infrastructure spending this year, which will be up from about 28 percent in 2014.

Private cloud IT infrastructure spending will grow by 16 percent year-over-year to $12 billion, while public cloud IT infrastructure spending will grow by 25 percent in 2015 to $21 billion, according to the latest worldwide market study by International Data Corporation (IDC).

For the full year 2014, cloud IT infrastructure spending totaled $26.4 billion, up 18.7 percent year over year from $22.3 billion -- private cloud spending was just under $10.0 billion, up 20.7 percent year-over-year, while public cloud spending was $16.5 billion, up 17.5 percent year-over-year.

Regional and Worldwide Market Forecast

In 2015, Western Europe is expected to have the highest growth in cloud IT infrastructure spending at 32 percent, followed by Latin America (23 percent), Japan (22 percent), and the U.S. market (21 percent).

For the five-year forecast period, IDC now expects that cloud IT infrastructure spending will grow at a compound annual growth rate (CAGR) of 14 percent -- both public cloud and private cloud are expected to grow at the same CAGR.


By 2019, IDC also expects worldwide cloud IT infrastructure spending to be $52 billion, or 45 percent of total IT infrastructure spend -- public cloud will represent about $32 billion of that amount, and private cloud will account for the remaining $20 billion.

Given the current market development trajectory, this trend is unstoppable. It would be unwise for a legacy CIO to continue to deny the apparent benefits of cloud computing and thereby resist the Digital Business change that their more forward-thinking peers have already embraced.

Essential Role of Shadow IT and Open Source

"The pace of adoption of cloud-based platforms will not abate for quite some time, resulting in cloud IT infrastructure expansion continuing to outpace the growth of the overall IT infrastructure market for the foreseeable future," said Kuba Stolarski, research manager at IDC.

In many organizations, a key driver of the rapid adoption of cloud applications and DevOps practices continues to be the unstoppable "Shadow IT" phenomena -- where savvy Line of Business leadership refuses to be held back by the inherent limitations of their company's internal IT organization.

As the global market evolves into deploying more cloud-native solutions -- enabled by open source software, such as OpenStack -- IDC belives that organizations of all types and sizes will discover that traditional approaches to IT management will increasingly fall short of the simplicity, flexibility, and extensibility requirements that form the core of cloud computing solutions.

Popular posts from this blog

How Cloud-Based Collaboration Boosts Performance

Online collaboration has evolved during the last decade, delivering even greater value -- thanks to a new generation of business technology applications. Forbes Insights released "Collaborating in the Cloud," a Cisco-sponsored study examining the ways business leaders increasingly look at cloud collaboration as a way to increase productivity, accelerate business results and enhance innovation across borders and functions. The research combines a global survey of more than 500 executives with 15 executive interviews. "The ability to collaborate in the cloud is becoming a key driver of competitive advantage," says Bruce Rogers, Chief Insights Officer of Forbes Media . "Leading companies are doing more to foster cloud-based collaboration -- not only internally, but also with an ever-wider swath of external groups including customers, suppliers, partners, and even regulators." The benefits of cloud-based collaboration, Rogers continues, include "gre...