A year into COVID-19 has resulted in great devastation across the world but has also revealed the resiliency, generosity and inherent adaptability of human nature. Social distancing and stay at home directives forced major adjustments not only in our personal lives, but also in business, education and social activities.
All aspects of human life that had already been online were forced to adapt and improve at a rapid rate, causing massive and possibly permanent shifts in how we collaborate, how we connect, how we shop, how we consume entertainment, how we educate and how we learn… to name a few.
When mankind looks back at this time in history, we will probably marvel at how much innovation, accelerated over this period… particularly true in the online space, the growth of which was made possible by the rapid adoption of cloud computing and the growth of cloud IT infrastructure.
Growth of Global Cloud Computing Market
Cloud computing as a concept describes the mechanism to deliver and consume resources over the internet. These resources can include software, networking, data storage, databases and servers.
Cloud IT infrastructure is the physical infrastructure of servers, storage and networking components that makes cloud computing possible.
As opposed to traditional IT infrastructure that is usually on-premises and restricted by location, cloud infrastructure supports an on-demand virtual distributed model that can span multiple regions across the globe.
The move to cloud computing had already been picking up momentum over the past decade and was being adopted by big corporations, small businesses, startups, government agencies and non-profits.
The benefits of cloud computing over traditional IT infrastructure include:
- Increased productivity
- Cost savings
- Better performance
- Higher security
These benefits along with the instant scalability provided by public cloud infrastructure allowed businesses to map a faster path to digital transformation to meet the changing and evolving conditions of doing business.
Growth of Cloud IT Infrastructure Products
Another indicator of the growth of cloud computing are the sales revenue trends for IT infrastructure products for both public and private cloud environments, like servers, enterprise storage and Ethernet switches.
According to a report by the International Data Corporation (IDC) Worldwide Quarterly Cloud IT Infrastructure Tracker for the third quarter of 2020, year over year there was:
- Increase of 9.4% in vendor revenue from sales of cloud infrastructure products
- Decline of -8.3% in the investments made in traditional (non-cloud) IT infrastructure
However, since the volatility of the market has decreased since the initial impact of COVID-19. IDC expects that for the full year 2020,
- Cloud IT infrastructure spend will show 11.1% year over year growth to $74.1 billion
- Public cloud IT infrastructure is expected to grow by 16.7% year over year to $52.7 billion
- Spending on private cloud infrastructure is expected to decline -0.5% to $21.3 billion for the full year.
As seen in the above chart, (forecasted through 2024), IDC expects spending on cloud IT infrastructure to reach $110.5 billion in 2024 and also that it would account for 64.0% of total IT infrastructure spend.
IDC expects that in the long term, spending on cloud IT infrastructure will grow at a five-year compound annual growth rate (CAGR) of 10.6%, with
- Public cloud datacenters growing at 11.3% CAGR
- Spending on private cloud infrastructure growing at a CAGR of 9.2%
- Spending on non-cloud IT infrastructure declining overall at a CAGR of -1.7%.
The growth of Cloud Computing and Cloud IT infrastructure for both public and private clouds is here to stay, strengthened by our expedited need for digital transformation to accommodate the permanently changed landscape of doing business, the increased availability of the internet, the adoption of more mobile devices around the world, an upheaval of the education system and the consumption of more and more big data.
Are you evaluating private cloud solutions to migrate your traditional IT infrastructure? Contact the InMotion Cloud Solutions team to get an assessment and access to free trials and Proof of Concept(PoC) credits.