News & Analysis

Massive Growth in Cloud Spends

Gartner has predicted that the global spends on public cloud services would lead the growth in overall cloud spends across 2023


Increasing cloud spends and its impact on the overall growth of the industry has been spoken about at length in recent times. However, now Gartner thinks that spending on cloud services, more specifically public cloud, could grow by a massive 21.7% in 2022 with about $600 billion likely to be the number as against $491 billion last year. 

The research company predicts this growth to come on the back of how cloud services were driving digital businesses around emerging technologies such as generative artificial intelligence, the Web3 and metaverse. Gartner predicts that such growth would continue in 2024 and possibly beyond as multi-cloud is also expected to drive spends on platforms. 

As for hyperscalers such as AWS, Microsoft and Google Cloud, they appear to be engines of this growth due to the generative AI spiral. Large language models are powering generative AI needs that require powerful and scalable computing power to process data in real-time. 

Cloud offers the best of both worlds

In a statement, VP analyst at Gartner Sid Nag says that these capabilities are available on the cloud and are the perfect solution and platform both. And it is no coincidence that the key players in the generative AI race are cloud hyperscalers. Gartner also predicts that all segments of the cloud market would grow over the next eight months. 

It expects the biggest growth volume to come from the infrastructure-as-a-service segment that could see growth rates upwards of 30% while the platform-as-a-service segment could grow by 24%. These big spends are a result of the trend of chatbots and digital twins coming home to roost and require cloud infrastructure and platform services for compute and storage heft. 

The official also said that the infrastructure as a platform service may account for the largest spike but software as a service continues to retain the top slot for maximum user spends, with a growth of 17.9% that translates into $197 billion in actuals.

Meanwhile, a published article on SDxCentral quoted Nag to suggest that multi-cloud platform and services spends are also on the upswing. Currently about 76% of companies have workloads running on multiple clouds, mostly mission critical ones.  Companies may get AWS as the primary cloud provider but use Microsoft Azure for applications in the future, he said. 

He also pointed out that it was important to recognize the need for multi-cloud platforms but more so to understand the services layer provided by the managed services agents and the global system integrators such as Cognizant, Accenture and others. 

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