Analysts: Cloud Spending Tops $110B, Led by IaaS and PaaS

Synergy proclaims 2015 "The Year of the Cloud," as it observes high cloud revenue numbers

Michael Cusanelli

January 8, 2016

2 Min Read
Analysts: Cloud Spending Tops $110B, Led by IaaS and PaaS
(Photo by Sean Gallup/Getty Images)

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2015 is officially being referred to as “The Year of the Cloud,” according to Synergy Research Group, which said last year marked the first time cloud services and infrastructure officially became mainstream in the eyes of enterprise customers.

On Thursday, Synergy published the results of a study that measured the growth rates of six different cloud segments ranging from Unified Communications as a Service and Software as a Service to public and private cloud deployments.

Synergy concluded that cloud operator and vendor revenues reached a total of $110 billion during the four quarters between Q4 2014 and Q3 2015, which marked a 28 percent annual growth rate for all cloud service and infrastructure market segments measured.

Public Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) exhibited the highest growth rate at 51 percent, followed by private and hybrid cloud infrastructure services at 45 percent, according to Synergy. All segments grew by at least 16 percent.

While infrastructure hardware and software spending continues to beat out the amount of spending on cloud services, Synergy said the gap is closing rapidly, which could signal a reversal within the next several years.

About $60 billion was spent on infrastructure hardware and software during the measured period, with more than $30 billion going toward the growth of private clouds, according to Synergy. Public cloud spending accounted for less of the overall growth, but spending has increased much more rapidly in this arena, the study showed. Overall, investments in infrastructure by cloud service providers generated an impressive $20 billion in revenues from the myriad of cloud infrastructure services, with an additional $27 billion coming from Software as a Service and other internet services.

“Cloud technologies are now generating massive revenues and high growth rates that will continue long into the future, making this an exciting time for IT vendors and service providers that focus on cloud,” said Synergy Research Group Chief Analyst John Dinsdale, in a statement.

Of course, it’s been fairly apparent for a long time now that cloud service spending is on the rise, but Synergy’s study is useful in placing giving cloud enthusiasts the numbers to back up their claims of market dominance. Naturally, companies like Cisco Systems, Hewlett Packard Enterprise, Amazon and Microsoft continue to lead the pack in this arena, echoing earlier studies naming them as the dominant cloud service providers. Aside from the success of the cloud infrastructure industry, adjacent services are also seeing an uptick in popularity, including cloud security services and mobile cloud solutions.

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