Public cloud investment will drive enterprise apps revenues through 2026 - IDC

Spending in this area is predicted to make up nearly two thirds of all enterprise applications revenue

Global revenues for enterprise applications are in store for a hefty rise from $279.6bn in 2022 to $385.2bn in 2026.

According to predictions from IDC, nearly all of this growth will come from investments in public cloud software, which is expected to represent nearly two thirds of all enterprise applications revenue in 2026.

While the process of migrating from on-premise applications to the cloud can take years, enterprise software vendors and their customers will continue the transition to the cloud as an essential part of business operations in the digital world, the research house explained.

It added that companies who do not pursue this technology will sustain losses due to profound opportunity costs as their competitors adopt cloud technologies and the use of application programming interfaces (APIs).

"It's no longer enough for businesses to sit back and rely on their technological debt of software and hardware assets to keep the company running. In the digital world, enterprise software needs to constantly innovate to keep up with demand for speed, scale, and a resilient business," said IDC research director of Worldwide Digital Commerce, Heather Hershey.

"Organisations must invest in new tools to keep their application portfolio up to date as they move into the digital era, automating all processes while also leveraging innovation and a wealth of data to become a more creative and resilient company in the digital realm."

In addition to the ongoing cloud migration, IDC identified a number of other significant market developments that are helping the enterprise apps market over the line.

These include SaaS and cloud-based, modular, and intelligent apps which have now become "essential" for business; application programmable interface technology; and new global regulations around data privacy and ethics that have changed the way organisations collect and use data, pushing governance to the forefront of the conversation.