Gartner just came out with a forecast that 2023 worldwide public cloud spend will grow 20.7% which is higher than their 18.8% growth forecast for 2022.
“Current inflationary pressures and macroeconomic conditions are having a push and pull effect on cloud spending,” said Sid Nag, Vice President Analyst at Gartner. “Cloud computing will continue to be a bastion of safety and innovation, supporting growth during uncertain times due to its agile, elastic and scalable nature.”
Some segments are forecast to grow more than others:
- IaaS – 29.8% yoy growth
- PaaS – 23.2% yoy growth
- SaaS – 16.8% yoy growth
PaaS and software-as-a-service (SaaS) will see the most significant impacts from inflation due to staffing challenges and the focus on margin protection.
“Cloud migration is not stopping,” said Nag. “IaaS will naturally continue to grow as businesses accelerate IT modernization initiatives to minimize risk and optimize costs. Moving operations to the cloud also reduces capital expenditures by extending cash outlays over a subscription term, a key benefit in an environment where cash may be critical to maintain operations.”
Despite growth, profitability and competition pressures, cloud spending will continue through perpetual cloud usage. Once applications and workloads move to the cloud they generally stay there, and subscription models ensure that spending will continue through the term of the contract and most likely well beyond. For these vendors, cloud spending is an annuity – the gift that keeps on giving.