According to a report by international data corporation (IDC), worldwide revenue for the public cloud services market totalled $669.2 billion in calendar year 2023, an increase of 19.9 per cent compared to 2022.
The report noted that the largest source of public cloud services revenue in 2023 was software as a service (SaaS) – applications, which accounted for nearly 45 per cent of the market total. In addition, infrastructure as a service (IaaS) was the second-largest revenue category with 19.9 per cent of the total, while platform as a service (PaaS) and software as a service – system infrastructure software (SaaS – SIS) delivered 18.4 per cent and 17 per cent of overall revenue respectively. Also, PaaS and SaaS – SIS were the categories with the fastest year-over-year revenue growth.
Commenting on the report, Adam Reeves, research director, PaaS for developers of modern and edge applications, IDC, said, “In large part due to end-user investment in artificial intelligence (AI), PaaS revenue growth continues to outpace the overall cloud market. Both market share-leading vendors and smaller providers continue to release PaaS-delivered AI offerings. Vendors are focused on being strategic partners to their customers by delivering highly performant, developer-friendly, trustworthy, and secure offerings that help users deliver intelligent applications more efficiently.”
The report highlighted that the leading providers of public cloud services maintained their positions in 2023 with the combined revenue of the top five public cloud service providers – Microsoft, Amazon Web Services (AWS), Salesforce Inc., Google, and Oracle – capturing 40.5 per cent of the worldwide total. With offerings in all four deployment categories, Microsoft remained in the top position in the overall public cloud services market with 16.8 per cent share in 2023, followed by AWS with 12.4 per cent share.
As per the report, worldwide public cloud services revenue will surpass $800 billion in 2024, an increase of 20.5 per cent over 2023 with a similar increase expected in 2025. While the annual rate of growth will slow slightly over the forecast period, the market is still forecast to deliver a five-year compound annual growth rate (CAGR) of 19.5 per cent with worldwide revenues reaching $1.6 trillion in 2028.
Meanwhile, Dave McCarthy, research vice president, cloud and edge infrastructure services, said, “The mainstreaming of AI is driving organisations to rethink their infrastructure strategy. Public cloud IaaS will be an attractive source for AI-ready infrastructure as cloud service providers are heavily investing in the high-performance compute, storage, and networking services needed for AI workloads. The on-demand and pay-as-you-go tenets of cloud infrastructure facilitate access to the latest AI technology without large upfront investments or supply chain delays.”
