Gartner: Global public cloud spending to reach $332.3 billion in 2021; 23.1% YoY increase
According to Gartner, global public cloud spending is forecast to reach $332.3 billion in 2021, increasing by 23.1% from $270 billion in 2020. Growth in cloud spending can be attributed to increased adoption in technologies such as virtualization, edge computing and containerization.
“The events of last year allowed CIOs to overcome any reluctance of moving mission critical workloads from on-premises to the cloud,” said Sid Nag, research vice president at Gartner. “Even absent the pandemic there would still be a loss of appetite for data centers.
Table 1. Worldwide Public Cloud Services End-User Spending Forecast (Millions of U.S. Dollars)
| 2020 | 2021 | 2022 | |
| Cloud Business Process Services (BPaaS) | 46,131 | 50,165 | 53,121 |
| Cloud Application Infrastructure Services (PaaS) | 46,335 | 59,451 | 71,525 |
| Cloud Application Services (SaaS) | 102,798 | 122,633 | 145,377 |
| Cloud Management and Security Services | 14,323 | 16,029 | 18,006 |
| Cloud System Infrastructure Services (IaaS) | 59,225 | 82,023 | 106,800 |
| Desktop as a Service (DaaS) | 1,220 | 2,046 | 2,667 |
| Total Market | 270,033 | 332,349 | 397,496 |
BPaaS = business process as a service; IaaS = infrastructure as a service; PaaS = platform as a service; SaaS = software as a service Note: Totals may not add up due to rounding.
Source: Gartner (April 2021)
As organizations mobilize for a massive global effort to produce and distribute COVID-19 vaccinations, SaaS based applications that enable essential tasks such as automation and supply chain is critical. Such applications continue to demonstrate reliability in scaling vaccine management, which in turn will help CIOs further validate the ongoing shift to cloud.
“It’s important to note that the usage and adoption of cloud that served enterprises well during the ongoing crisis will not look the same in the coming years,” said Mr. Nag. “It will further evolve from serving pedestrian use cases such as infrastructure and application migration, to those that combine cloud with technologies such as artificial intelligence, the Internet of Things, 5G and more.
“In other words, cloud will serve as the glue between many other technologies that CIOs want to use more of, allowing them to leapfrog into the next century as they address more complex and emerging use cases. It will be a disruptive market, to say the least.”
Cloud Computing Fuels Revenues and Profits for Big 3 Cloud Companies:
Amazon’s market-leading AWS cloud business grew revenue 32% in the first quarter, a faster pace than analysts had expected and accelerating from 28% growth in the fourth quarter. Microsoft’s revenue has skyrocketed since it invested billions of dollars to build a massive, interconnected cloud computing platform. Revenues for its Azure cloud offering were up 50% in the quarter. Meanwhile, revenues at Google’s Cloud business grew 46% this past quarter. However, Google continues to be a distant third to Amazon and Microsoft in the cloud business.
All three cloud providers are making a big push into edge computing and 5G “cloud native” core networks. That effectively makes them leaders in those new tech markets, with the traditional network providers playing a subservient role. For example, Dish Network will build its 5G core network using the AWS cloud infrastructure and services.
These big three cloud businesses are in reality massive cloud (i.e. Internet) resident data centers with high-speed interconnections (Data Center Interconnects). There’s no reason to think growth will slow any time soon. Were they stand-alone businesses, they would be the three largest enterprise-software entities in the world. And they design their own compute servers, making them the world’s largest global computer companies too!
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While cloud services boomed in the past year, Gartner suggests that spending on cloud might take a different note in 2021 and 2022 as enterprises shift away from infrastructure and application migration towards advanced applications integrating AI and IoT and 5G.
In the first quarter of 2021, research and analytics firm Canalys reported that global cloud services infrastructure spending grew to $41.8 billion to represent a 35% year-on-year increment and 5% quarter-on-quarter growth.
References:
Curmudgeon/Sperandeo: Technology Fab Five Biggest Winners from Covid-19 Pandemic
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Reinhardt Krause of Investors Business Daily:
Cloud Computing: Amazon Leads In Data Center Spending:
Based on first-quarter earnings reports, 2021 is shaping up as another big year for cloud capital spending. But again, it’s still largely guesswork for analysts.
Take Amazon Web Services (AWS), the biggest provider of cloud computing services. Its March-quarter capital spending blew past estimates, jumping 78% to $12.1 billion from a year earlier.
Not all of that was cloud-related, though. Some of that went toward Amazon’s fulfillment centers, logistics and product distribution network.
Morgan Stanley analyst Katy Huberty addressed the issue in a recent note to clients:
“Estimates from (market researcher) Dell’Oro suggest that the three other major U.S. hyperscalers (Facebook (FB), Google and Microsoft) spend between 60% and 80% of total capex on (cloud computing) data centers and related infrastructure equipment, much higher than Amazon given its growing logistics and fulfillment spend,” Huberty said. “Quarterly capex trends for Amazon have become a less effective indicator of data center spend compared to the other three U.S. hyperscalers.”
Amazon: Cloud Revenue Grows 30% In 2020
But for all of 2020, Amazon’s capital spending boomed 138% to more than $40.1 billion, said a Bank of America report. Google’s overall capital spending dipped 5% to $22.3 billion while Microsoft’s total capital spending rose 30% to $17.6 billion, said BofA.
The three biggest cloud computing services continue to gain share vs. rivals such as IBM (IBM) and Oracle (ORCL), analysts say. But whether they’re making significant profit — or any profit at all — based on what they spend is unclear.
AWS cloud revenue rose 30% to $45.4 billion in 2020. Microsoft’s Azure cloud business climbed 50% to $24.7 billion. Google’s cloud revenue, including Workspace office software, rose 46% to $13.1 billion. To stay on top, the cloud titans aim to make sure they can meet growing customer demand.
Their customers rent computer processing power and data storage by the hour, week or month.
Another Set Of Cloud Titans:
Bank of America has its own group of cloud computing titans that includes China’s Alibaba Group (BABA), Baidu (BIDU) and Tencent Holdings (TCEHY) as well as Microsoft, Google, Facebook and Amazon stock.
It forecasts that 2021 cloud capital spending by those seven companies will rise 20% to $128.3 billion vs. 37% growth in 2020.
Dell’Oro, in a March 17 press release, forecast that “hyperscale,” cloud data center capital spending will rise 20% in 2021. However, Dell ‘Oro didn’t provide a dollar figure or list the companies involved in the forecast. Dell’Oro did not respond to an email requesting more information.
https://www.investors.com/news/technology/cloud-computing-are-spending-but-how-much/
July 30, 2021 UPDATE:
Global spending on cloud infrastructure services totaled USD 42-47 billion in the second quarter of 2021, according to two of the latest research reports from Canalys and Synergy. That’s a rise of 36-39% from the same period a year earlier.
The industry attracted spending of 47 billion in the period, up 36 percent from a year earlier and USD 5 billion higher than the previous quarter, thanks to workload migration and the acceleration of cloud native application development, a study by Canalys showed.
The pandemic and, more recently, extreme weather events have raised concerns over the long-term disruption from environmental risks, boosting the importance of cloud services, the researchers found.
The top three cloud service providers attracted 61 percent of total spending in the second quarter, led by Amazon Web Services (AWS) whose income rose 37 percent year on year and had a 31 percent market share, Canalys researchers estimated.
Microsoft Azure was the second largest cloud service provider, with a 22 percent market share, and its income grew 51 percent year on year while Google was third with an 8 percent market share and with a 66 percent annual rise in income over the quarter.
According to data from Synergy Research Group, meanwhile, second-quarter enterprise spending on cloud infrastructure services totaled USD 42 billion, up USD 2.7 billion quarter on quarter and 39 percent higher than the year-earlier period, marking the fourth successive quarter of year-on-year growth.
According to Synergy Research’s calculations, Amazon re-established its strong lead in the second quarter with a 33 percent share of the cloud market, thanks to sequential growth of 10 percent. Microsoft and Google accounted for another 30 percent of the market. Synergy added, and the next 20 cloud providers combined had a 28 percent market share.
Among the companies chasing the top three, those with above average growth rates include Alibaba and four other leading Chinese cloud providers, Synergy said.
https://www.telecompaper.com/news/global-cloud-infrastructure-industry-worth-usd-42-47-bln-in-q2-research–1392136