In the first half of 2023 (1H23), the global revenue for public cloud services increased to $315.5 billion, marking a 19.1% surge compared to 2022, according to the International Data Corp. (IDC) Worldwide Semiannual Public Cloud Services Tracker.
The landscape of public cloud services saw Software as a Service – Applications (SaaS – Applications) leading the charge, contributing nearly 45% of the total revenue in 1H23. Infrastructure as a Service (IaaS) followed as the second-largest category, claiming 20.4% of the share, while Platform as a Service (PaaS) and Software as a Service – System Infrastructure Software (SaaS – SIS) contributed 18% and 16.9% of the overall revenue respectively.
IDC said PaaS and SaaS – SIS experienced the most rapid year-over-year revenue growth.
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“The fundamentals of cloud technologies and public cloud PaaS providers as strategic partners to enterprises and companies of all sizes are evident as AI pervasiveness strengthens,” said Lara Greden, research director, Platform as a Service, IDC. “Companies continue to accelerate movement to and adoption of the cloud for modernization and new, intelligent application initiatives based on all types of data streams. The strong market growth seen in PaaS comes from not just the top few but a large ecosystem of PaaS vendors that are meeting customer needs in the cloud.”
The top 5 public cloud service providers which maintained their positions include:
1. Microsoft
2. Amazon Web Services
3. Salesforce Inc.
4. Google
5. Oracle
Collectively, these cloud providers secured 41% of the global revenue in 1H23, similar to the previous year’s standing. Microsoft retained its lead in the public cloud services market with a 17.1% share, followed closely by Amazon Web Services at 12.6%.
IDC projections
IDC’s Worldwide Semiannual Public Cloud Services Tracker analyzes more than 70 segments of the global public cloud services market, tracking revenue from various categories like IaaS, PaaS, SaaS – SIS, and SaaS – Applications subscription revenues. The Tracker monitors over 850 cloud services companies across 49 countries globally, updating semiannual forecasts at worldwide, regional, and country levels.
IDC projects a further increase in worldwide public cloud services revenue, anticipating a climb to $663 billion in 2023, marking a 20% increase from 2022. Although the growth rate is expected to taper slightly in the forecast period, a five-year compound annual growth rate (CAGR) of 19.4% is predicted, with revenues hitting $1.34 trillion in 2027 globally.
“Organizations recognize the importance of staying at the forefront of technological advancements, like generative AI or real-time analytics, to enhance their business operations and gain a competitive edge,” said Dave McCarthy, research vice president, Cloud and Edge Infrastructure Services. “The cloud’s dynamic nature and the continuous evolution of cloud services make it an ideal platform for organizations to adopt new technologies. This creates a great opportunity for the cloud service providers to offer comprehensive support and management services, reducing the burden on IT teams and accelerating the deployment and integration of new technologies.”