The COVID-19 pandemic catalyzed a shift in the business landscape, propelling enterprises to embrace cloud solutions as a response to unprecedented challenges. This transformation came about in various ways, including the widespread implementation of remote work, the automation of critical business processes and the heightened utilization of digital channels for customer interactions.
As organizations adjusted to the demands of the pandemic, cloud computing played a pivotal role, and the cloud computing market is expected to see more growth. In fact, the total revenue opportunity for cloud computing in the enterprise segment is poised to reach $1.4 trillion in 2027 globally, driven by positive IT investment sentiment seen among enterprises globally, and the large-scale automation and IT modernization initiatives taken up by them, forecasts GlobalData, a data and analytics company.
The transition to the cloud offers significant benefits, including greater scalability, agility and resilience. This means that organizations can quickly adapt to changing demands, efficiently scale resources as needed, and build robust systems that can withstand disruptions. Cloud adoption also allows businesses to leverage DevOps practices, facilitating a more streamlined and collaborative approach to infrastructure and software development.
This synergy between IT modernization and the cloud positions the cloud computing market for substantial growth, as companies recognize the strategic advantage of these technologies in achieving modern, flexible and efficient IT environments.
The proliferation of IoT devices, particularly with the accelerated deployment of 5G networks, presents another opportunity for the enterprise cloud computing market. Cloud platforms not only serve as a repository for storing and processing the massive amounts of data generated by IoT devices but also enable remote access and management of these devices and the data they produce.
As the number of IoT use cases expands, from smart homes to industrial applications, the enterprise cloud computing market is poised to experience heightened demand, driven by the necessity of effective IoT data handling and remote device management.
The increasing utilization of AI to extract meaningful insights from vast volumes of data has also become a key driver for enterprise cloud investments. Cloud infrastructure provides the scalable storage and computing power required to process and analyze large datasets efficiently. This is essential for AI algorithms, which demand significant computational resources.
As businesses recognize the competitive advantages of data-driven decision-making and the potential for innovation through AI applications, they turn to the cloud to support their data-intensive AI initiatives. This convergence of AI, big data and cloud computing forms a compelling business case, driving further investment in cloud infrastructure by enterprises seeking to utilize AI to gain valuable insights and drive innovation.
Sure, the large enterprise segment will account for a larger share of the total revenue opportunity for cloud computing globally. However, revenue from the micro, small and medium size enterprise segment is expected to increase at a CAGR of 18.1% over the forecast period.
“The post pandemic optimism over enterprise IT spending will be a key factor for sustained growth in the cloud computing market over the forecast period,” said Sandeep Kolakotla, Technology Lead Analyst at GlobalData.
Edited by Alex Passett