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12 Aug 2016

Public Cloud Services Spending in Central and Eastern Europe Forecast to Reach $2 Billion by 2020, According to IDC

FOR IMMEDIATE RELEASE, Prague – A new update to the Worldwide Semiannual Public Cloud Services Spending Guide from International Data Corporation (IDC) shows a significant increase across Central and Eastern Europe (CEE) region revenues from public cloud services, which are expected to reach more than $2 billion in 2020. This will be more than double the $992.9 million in revenues forecast for 2016 and represents a compound annual growth rate (CAGR) of 20.7% over the 2016–2020 forecast period.

"End-user organizations in the CEE region are focusing on operational efficiency and cost savings associated with infrastructure operations and maintenance,” says Petr Zajonc, a senior research analyst with IDC’s IT Services team. “This will provide them with sufficient resources to develop solutions that give them a competitive edge. Cloud is thus becoming a tool enabling cost savings in specific cases and allowing IT departments to focus on projects that support business goals."

Although notable growth is forecast for all countries in the region, there are geographic differences. While the most of the region is expected to have a CAGR of more than 20% in 2016–2020, such as Hungary (26.3%) and Romania (24.6%), Russia is forecast to post a much smaller CAGR of 17.2%. "The overall performance of the Russian economy in the forecast period will be heavily influenced by the slump in commodity prices, which is putting pressure on fiscal consolidation in both the public and private sectors," says Ivana Slaharova, an IDC research analyst for Customer Insights and Analysis. "Public cloud services in Russia will be also negatively affected by the new data residency laws, which are complicating the situation for international vendors trying to expand their cloud offerings in the country."

The growth rates of cloud-related spending across industry verticals are mostly similar, with the highest CAGR of 23.2% projected for healthcare, followed by the consumer and manufacturing sectors (22.9% and 22.8%, respectively). The lowest spending levels will be seen in the regional telecommunications sector, with an overall CAGR of 17.9%. The differences between industries, which are attributable to different IT maturity levels, as well as to regulatory compliance issues and other industry-specific issues, are much less pronounced than the differences between Russia and the rest of the regions.

Technologies including big data, cloud, mobility, and social media are rapidly changing business models. Customer co-creation and agile techniques are redefining the way customer-oriented solutions work, as well as changing the speed at which new solutions reach the market. Digital 3rd and 4th Platform technologies help companies make better business decisions, accelerate time to market, build better customer experiences, optimize customer acquisition costs, and seize new market opportunities. Currently, most companies are focusing on deploying analytics solutions to understand customer behavior and provide personalized promotions and offers. Cloud is one of the main enablers on the digital transformation journey, as it gives user organizations access to the latest technology and shortens deployment times.

About IDC Spending Guides

IDC's Spending Guides provide a granular view of key technology markets from a regional, vertical industry, use case, buyer, and technology perspective. The spending guides are delivered via pivot table format or custom query tool, allowing the user to easily extract meaningful information about each market by viewing data trends and relationships.

For more information about IDC's Spending Guides, please contact Monika Kumar at mkumar@idc.com.

About IDC

International Data Corporation (IDC) leads the ICT innovation discussion through events, research, and consulting. For nearly five decades, it has been giving ICT and business professionals data and insight for making strategic and practical decisions. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. Learn more at www.idc.com.



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