This growth rate, which is more than 4.5 times that of the IT industry overall, showed a modest drop from 2017, not unexpected given the growing base of comparison in the public cloud services market, which has more than doubled over the preceding three years.
The top 5 public cloud service providers accounted for 46.3% of all spending growth in 2018 and 35% of all 2018 spending, up 3 points from 2017.
This continues a consolidation trend in the overall public cloud services market among the leaders, most pronounced in the combined Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) segments, in which the top 5 vendors accounted for a 63% share of spending.
“Our latest public cloud data continues to show robust growth – headed toward almost $500 billion by 2023 – and consolidating power positions across the board,” said Frank Gens, senior vice president and chief analyst at IDC.
“The most intense and strategic consolidation – in the combined IaaS and PaaS segments – is being driven by developers’ and enterprises’ bets on which vendors will sustainably deliver tech innovation for the next decade and beyond.”
“Software as a Service (SaaS) continued to be the most highly deployed cloud segment, representing a commanding 62.4% of the total cloud market revenues, including system infrastructure software (SIS).
“Adoption of cloud enterprise business applications like ERP, SCM, and HCM also accelerated across all segments with most buyers taking a SaaS-first or SaaS-also posture for new applications,” said Frank Della Rosa, research director, Software as a Service at IDC.
“The continued demand for applications and the shortage of professional developers fueled the demand for PaaS solutions,” said Larry Carvalho, research director, Platform as a Service at IDC.
“Cloud native infrastructure grew demand for platform tools to accelerate application development and deployment powered by abstracted container workloads. Although the Asia/Pacific region had just about 11% of total share, the revenue grew faster than the rest of the world.”
“The public cloud IaaS market reversed its trend of slowing growth with a robust jump in its year-over-year growth rate,” said Deepak Mohan, research director, Cloud Infrastructure Services at IDC.
“This shift is notable – given the $24 billion base of this market in 2017 – and was driven heavily by growth among the global market leaders and in the Asia/Pacific (excluding Japan) (APeJ) region, particularly China. Revenue growth for Amazon Web Services and in the APeJ region jointly accounted for 80% of all the spending growth in 2018.”