Gartner: Worldwide Public Cloud Spending to Reach $600 Billion in 2023

Rebekah Carter

The analyst dissects the increasing demand for public cloud

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Gartner: Worldwide Public Cloud Spending to Reach $600 Billion in 2023

Gartner has released its latest forecast for the evolving public cloud landscape in 2023.

According to the analyst, worldwide end-user spending on services within the public cloud environment will grow around 20.7 percent in 2023. This will increase the value of the industry from $490.3 billion in 2022, to a potential $591.8 billion in 2023.

According to Sid Nag, Vice President Analyst at Gartner, rising inflationary pressures are combining with complex macroeconomic conditions to generate new demand for cloud spending.

For many users, cloud computing represents a safe and innovative landscape for continued growth and functionality during “uncertain times”.

The scalable, elastic, and agile nature of the cloud makes it ideal for those hoping to take advantage of rapidly changing trends and new technologies. However, Gartner notes that spending could fail to rise to predicted standards if IT budgets are affected by financial issues in the coming year.

The Consistent Migration to Cloud Technology

Nag notes that cloud migration is still occurring at an incredible pace, inspired by a rapid shift in computing practices in the last couple of years.

In particular, “Infrastructure as a Service”, or “IaaS” is expected to see the highest increase in end-user spending during 2023. This particular segment is set to grow by around 29.8 percent.

Nag believes IaaS will be a crucial spending area for businesses as they accelerate their digital transformation and modernisation initiatives, with a focus on reducing costs and risk.

Transitioning operations into the cloud can also help organisations to reduce common capital expenditures, thanks to a subscription-based pricing structure.

Gartner also expects PaaS and Software as a Service being impacted by margin protection and staffing challenges.

However, these segments are still set to grow, with 23.2 percent growth predicted for PaaS, and 16.8 percent for SaaS.

Notably, Nag says skilled, higher-paid staff are often necessary to develop modern SaaS applications, which means organisations may struggle to find the right talent.

However, since PaaS can assist with the creation of automated code solutions and efficient tools for SaaS application, the rate of PaaS adoption is likely to increase.

Looking Forward to the Future of Growth

Even in a world affected by profitability, competition, and growth-related pressures, cloud spending is still likely to accelerate in the months and years to come.

Once companies move workloads and applications into the cloud, they tend to continue investing in this space. Nag noted that subscription models also help to ensure spending continues through the term of the contract.

Gartner is preparing to release additional insights into growing cloud strategies, operations, and infrastructure as part of the Gartner IT Infrastructure, cloud strategies, and operations conferences taking place in November and December this year.

To catch up on some of its CX-related research from earlier this year, read our rundowns of:

 

 


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