By using this site, you agree to the IDC Privacy Policy

23 Jul 2017

IDC Expects IaaS Spending to Surpass SaaS Spending for the First Time in 2017

APEJ public cloud services (PCS) market will exceed the US$10 billion mark by the end of the year

SINGAPORE, July 24th, 2017 – The public cloud services (PCS) market in Asia/Pacific excluding Japan (APEJ) is expected to exceed the US$10 billion mark in 2017, says IDC Asia/Pacific in its latest IDC Worldwide Semiannual Public Cloud Services Tracker. Infrastructure-as-a-service (IaaS) will drive the growth of the PCS market and will lead to IaaS spending surpassing Software-as-a-service (SaaS) spending in 2017 for the first time in the first half of 2017.

"Digital transformation is driving multi-cloud and hybrid IT environments for enterprises to create a more agile and cost-effective IT environment. Even heavily regulated industries like banking and finance are using SaaS for non-core functionality, Platform-as-a-service (PaaS) for app development and testing, and IaaS for workload trial runs and testing for their new service offerings,” says Liew Siew Choon, Senior Market Analyst, IDC Asia/Pacific's Services Research team.

"As enterprises are exploring different cloud options for different workloads, most enterprises have hybrid IT strategies with dispersed IT assets and workloads across onsite and offsite datacenters. The modern applications that support innovation accelerators such as Internet of Things (IoT) and cognitive systems will further increase the adoption of public cloud services,” Liew continued.

The top three PCS providers in APEJ region in 2016 are Amazon Web Services, Microsoft, and Alibaba Group with over 50% market share.

Liew added “These top providers have very credible IaaS offerings, as well as PaaS and SaaS offerings. For Microsoft, its IaaS revenue contribution has also surpassed SaaS (which is mainly Office 365) (O365) revenue contribution by end of 2016. Contrary to popular belief, Microsoft’s public cloud revenue is actually gaining more from Azure apart from O365 in APEJ.

The latest IDC Worldwide Semiannual Public Cloud Services Tracker also estimate that IaaS spending will reach US$4.8 billion in APEJ in 2017 driven by a 35.8% year-on-year (YoY) growth from previous year. SaaS and PaaS spending in the region is also expected to grow significantly YoY by 29.0% and 37.2% respectively.

"With data growth at an exponential rate, a scalable and rapid processing infrastructure from IaaS providers is increasingly demanded by enterprises for better resource utilization and cost savings,” Liew added.

Another driver of growth is risk management, whereby IaaS has been used tremendously for data backup and disaster recovery. In countries like China, the government initiative for cloud development is focusing on cloud infrastructure and leveraging internet services providers to promote the public cloud services.

The recent three-year (2017-2019) action plan for cloud development in China is still centered around cloud infrastructure as a foundation of transformation and development.

Read more about these trends in the upcoming Public Cloud Country Reports from IDC. Visit www.idc.com for more updates.

- Ends -

About IDC Trackers

IDC Tracker products provide accurate and timely market size, company share, and forecasts for hundreds of technology markets from more than 100 countries around the globe. Using proprietary tools and research processes, IDC's Trackers are updated on a semiannual, quarterly, and monthly basis. Tracker results are delivered to clients in user-friendly excel deliverables and on-line query tools. The IDC Tracker Charts app allows users to view data charts from the most recent IDC Tracker products on their iPhone and iPad.

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDC.

All product and company names may be trademarks or registered trademarks of their respective holders.

Coverage
Contact
For more information, contact:

Siew Choon Liew
scliew@idc.com
+603 7663 2110

Alvin Afuang
aafuang@idc.com
+63917 7974586

Theresa Rago
trago@idc.com
+65 9159 3053