2017 cemented cloud as the ‘new normal’ for enterprise IT, claims Synergy Research Group

Synergy Research Group (SRG) has declared 2017 as the year cloud became the accepted way for enterprises to consume IT, as sector revenues rose by nearly a quarter during the course of last year.

John Dinsdale, chief analyst and research director at SRG, said many of the long-standing barriers to cloud adoption had been addressed, and take-up was rising accordingly.

“We tagged 2015 as the year when cloud became mainstream, and 2016 as the year when cloud started to dominate many IT market segments. In 2017, cloud was the new normal,” said Dinsdale.

“Major barriers to cloud adoption are now almost a thing of the past, with previously perceived weaknesses – such as security – now often seen as strengths.”

According to the analyst house’s full-year analysis of the cloud market to September 2017, operator and supplier revenues for cloud services and infrastructure topped $180bn – up 24% on the previous year.

Overall, the infrastructure-as-a-service (IaaS) and platform-as-a-service (PaaS) suppliers achieved the highest growth rate (47%), followed by software-as-a-service (SaaS) providers at 31% and hosted private cloud infrastructure services at 30%.

“Cloud technologies are now generating massive revenues for cloud service providers and technology suppliers, and we forecast that current market growth rates will decline only slowly over the next five years,” Dinsdale continued.

SRG’s research also pointed to the fact that the gap between how much enterprises spend on cloud services compared with cloud-related hardware and software widened last year, after the latter overtook the former in 2016.

So much so, SRG claimed – in aggregate – the cloud services market was growing three times more quickly than the cloud infrastructure hardware and software segment.

Over the course of the reporting period, the amount of money spent on hardware and software to create private and public cloud infrastructures came close to $80bn, SRG claimed.

In turn, these infrastructure investments have allowed cloud providers to generate around $100bn in IaaS, PaaS, SaaS and hosted private cloud revenue.