infoTECH Feature

September 03, 2013

Public Cloud Will More than Double by 2017

There isn’t just one cloud, but in fact many clouds. Serious IT pros often use private clouds, either in-house or carved out of a service provider’s network. And they may use dedicated lines to get fast, secure access to these services.

But the public cloud is the one that we experience most often. And that popularity is prepping the public cloud for some serious growth. According to IDC (News - Alert), IT services run over the public cloud will rack up $47.4 billion in billing this year, but will more than double to $107 billion in 2017.

What does that mean for growth? How about a compound annual growth rate (CAGR) of 23.5%? IDC says that growth is five times faster than that of the general IT industry.

IDC is putting forth the notion of what it calls the 3rd Platform, which is greatly enabled by the cloud. This platform includes Big Data, social media and mobile.

“The first wave of cloud services adoption was focused on improving the efficiency of the IT department,” said Frank Gens, Senior Vice President and Chief Analyst at IDC.

“Over the next several years, the primary driver for cloud adoption will shift from economics to innovation as leading-edge companies invest in cloud services as the foundation for new competitive offerings. The emergence of cloud as the core for new 'business as a service' offerings will accelerate cloud adoption and dramatically raise the cloud model's strategic value beyond CIOs to CXOs of all types.”

The public cloud is benefitting from new approaches that blend the best of public and private technologies. One such option is virtual private cloud (VPC) which instead of being purely private, leverages multi-tenant public cloud services.

“By offering the attributes of public cloud (economics, scale, pace of innovation) with some of the privacy and control features associated with private cloud, VPCs are effectively addressing many of the objections that have held customers back from the cloud model,” IDC said.

Meanwhile, the public cloud is increasingly becoming a commodity, and as such will become more and more affordable. “While commoditization is expected to result in lower pricing and tighter profit margins, the competition will greatly expand the addressable market of solutions and customers. In order to survive, providers will have to scale their offerings "up and out" toward a broader range (and dramatically larger number) of customers,” IDC argued.

The public cloud is becoming a larger chunk or overall IT spending, and in four years will represent 17% of all IT dollars spent.

Edited by Ryan Sartor

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