Cloud Computing Market Outlook, Trend, Share Analysis till 2028

The cloud computing market size is estimated to value at US$ 405,295.8 million in 2022 and reach US$ 1,465,818.2 million by 2028; it is expected to grow at a CAGR of 23.9% from 2022 to 2028.

The costs of data hosting on-premises, both in terms of implementation and maintenance, are a concern for businesses. Moreover, electricity costs, employee expenses, and downtime issues are other concerns for enterprises. For better productivity, startups and SMEs are shifting their business models to online and cloud.

Furthermore, the current competitive environment and global economic conditions have accelerated the uptake of a cost-effective business model. The shift of businesses toward digital transformation, enhanced customer experience, and reduced enterprise cost positively impacted cloud computing market growth. For instance, the pay-as-you-go model allows companies to pay for cloud services only when they use them, resulting in lower costs.

Cloud computing has numerous advantages, including eliminating costs associated with installing, constructing, and managing business operations, which are fundamental difficulties encountered by SMEs. Cloud computing also allows quick access to all technological benefits. The primary reasons that small businesses are adopting cloud computing in their organizations are as follows:

• Flexibility:

  Organizations can use cloud computing to react quickly according to their requirements. Cloud computing diversifies workloads across an organization and allows employees to work from anywhere. When companies use Cloud Computing, they can easily hire a lower-cost workforce. The resources can also be scaled up and down depending on the company's needs. This allows SMEs to address the needs of their customers as quickly as possible.

• Better Security:

  One of the most pressing issues businesses have is security. Despite online threats, regular infrastructural security is quite challenging to monitor and maintain, so cloud-based solutions are much safer than traditional solutions, especially for small-scale businesses. Large expenditures and specialization are required, which cannot be accommodated or possible for SMEs. Besides, SMEs are most prone to exposure to other security threats, such as hardware failures, power outages, and other human errors. As a result, cloud computing solutions easily overcome these security challenges because cloud computing companies have already invested time and effort in upholding security standards and operational practices.

• Cost Cutting:

  Small businesses are constantly looking for ways to cut costs; as a result, Cloud Computing is the best investment for SMEs because it allows them to pay as they go. It assists SMEs in reducing expenses and promoting savings by requiring them to spend only on operational costs rather than capital expenditures and removing unnecessary costs.

• Scalability:

  Scalability is another benefit of cloud computing and is critical in modern business models. Modern businesses are rapidly expanding, and various cloud computing resources allow for scalability due to factors, such as storage, features, and the number of users.

The cloud computing market is analyzed on the basis of service model, deployment model, organization size, industry vertical, and geography. Based on service model, the market is segmented into Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS). Based on deployment model, the market is bifurcated into public cloud and private cloud. Based on organization size, the market is segmented into small and medium-sized enterprises (SMEs) and large enterprises. Based on industry vertical, the market is segmented into BFSI, IT & telecommunications, government & public sector, retail & consumer goods, manufacturing, healthcare & life sciences, and others. By geography, the market is divided into five regions: North America, Europe, Asia Pacific, the Middle East & Africa, and South America.

Strategic Insights

Impact of COVID-19 Pandemic on Cloud Computing Market

The spread of SARS-CoV-2 (COVID-19) delayed economic development globally. The lockdown imposed by the governments slowed the business operation of many Information & Communications Technologies (ICTs). In 2021, the uplifting of lockdown and vaccination drives created a favorable environment for the cloud computing market to grow.

Furthermore, key ICT players, such as Microsoft, IBM, Amazon Web Services, and VMware, focus on digital technologies to mitigate the adverse effects of the COVID-19 crisis in 2020. Many businesses have adopted new business models to protect their employees, such as the work-from-home model. This has boosted the demand for collaboration-based solutions, including Software-as-a-Service (SaaS). The increasing growth in the e-commerce industry is further driving the cloud computing market growth.

The COVID-19 pandemic adversely affected Europe's various industrial sectors. The governments across the region took drastic measures to ensure citizens' safety and health. Various government agencies across the EU made significant investments in cloud computing initiatives, thereby boosting the region's adoption of cloud-based services. In November 2020, the UK government signed a three-year contract with Amazon Web Services to increase cloud uptake across government organizations. It provides training and conducts workshops for businesses in the early stages of cloud deployment under this contract.

Furthermore, the flexibility and agility of the cloud solutions, and the ease of provisioning and scaling new resources led many enterprises to adopt the product, thus contributing to the Europe cloud computing market.

By geography, the cloud computing market is divided into five regions: North America, Europe, Asia Pacific, the Middle East and Africa, and South America.

Lucrative Regions in Cloud Computing Market

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Market Insights– Cloud Computing Market

Service Model-Based Insights

The cloud computing market analysis by service model, the cloud computing market is segmented into Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a service (SaaS). The SaaS segment accounted for the highest cloud computing market share in 2021. A software distribution model in which a cloud service provider hosts services is known as Software as a Service (SaaS). These services are accessible to end users over the Internet. Therefore, end users do not need to install any software on their devices to utilize them. A SaaS provider offers various business services to help a company get started. ERP (Enterprise Resource Planning), CRM (Customer Relationship Management), billing, and sales are examples of SaaS business services. SaaS document management is a software program provided by a third party (SaaS providers) for creating, managing, and tracking electronic documents. SaaS services are provided on a one-to-many basis, which implies that several users share a single application instance. The robust features of the SaaS model contribute to the cloud computing market growth during the forecast period.

Deployment Model-Based Insights

The cloud computing market analysis by deployment model, the cloud computing market is segmented into public cloud and private cloud. The public cloud segment is expected to account for a significant cloud computing market share during the forecast period. The public cloud is an IT architecture in which on-demand computing resources and infrastructure are managed by a third party and used by several enterprises over the public Internet. Public cloud service providers may provide cloud-based services, such as Infrastructure as a service (IaaS), platform as a service (PaaS), and Software as a service (SaaS), to users for a monthly or pay-per-use subscription, eliminating the need for users to host these services on-site in their own data center.

The public cloud makes computer resources available for purchase to anybody. Several users often share a public cloud. The expense of maintaining IT equipment is also passed on to the cloud service provider when using public cloud-based services. This results in the cloud computing market.

Players operating in the cloud computing market are mainly focused on developing advanced and efficient products.

• In 2022, Best Buy Co., Inc. chose Amazon Web Services, Inc. (AWS) as its preferred cloud provider for cloud infrastructure services and a key partner for developing cloud engineering expertise. This partnership will enable Best Buy to expand its use of cloud technologies across its retail operations and improve consumer experiences.
• In 2022, IBM and SAP partnered to deliver technology and consulting expertise to help clients adopt a hybrid cloud strategy and migrate mission-critical workloads from SAP solutions to the cloud for regulated and non-regulated industries.
• In 2021, Amazon Web Services, Inc. (AWS) launched four new initiatives to empower learners and make it even easier for anybody willing to learn to access free cloud computing skills training and open up new job opportunities in the cloud computing market.

Cloud Computing Market – Company Profiles

• Amazon Web Services
• Microsoft Corporation
• SAP SE
• IBM Corporation
• Salesforce.com, inc.
• Google LLC
• Oracle Corporation
• Alibaba Group Holding Limited
• Adobe
• Workday, Inc.