Public cloud services spending to boom says IDC

Latest report from analyst predicts public cloud services spending to reach $127bn in 2018

Public IT cloud services spending is set to grow at six times the rate of the IT market, reaching more than $127bn (£79.5bn) in 2018, according to the latest report from IDC.

The analyst anticipates public IT cloud services spending will reach $56.6bn in 2014 and grow at a five-year compound annual growth rate (CAGR) of 22.8 per cent, which is about six times the rate of the overall IT market.

In 2018, public IT cloud services will account for more than half of worldwide software, server and storage spending growth, according to the IDC report.

IDC said the cloud services market is now entering an "innovation stage" that will produce an explosion of new solutions and value creation on top of the cloud.

This growth in public cloud services spending will also be driven by the adoption of "cloud-first" strategies by IT vendors and IT buyers, the report said.

Frank Gens, senior vice president and chief analyst at IDC, said: "Over the next four to five years, IDC expects the community of developers to triple and to create a tenfold increase in the number of new cloud-based solutions.

"At the same time, there will be unprecedented competition and consolidation among the leading cloud providers. This combination of explosive innovation and intense competition will make the next several years a pivotal period for current and aspiring IT market leaders."

IDC also expects software-as-a-service (SaaS) to continue to dominate public IT cloud services spending, accounting for 70 per cent of 2014 cloud services expenditures.