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IDC Predicts Total Public and Private Cloud Services Spending in Central and Eastern Europe to Reach $2.5 Billion in 2020
In 2015, public and private cloud services spending in CEE reached $870 million, representing year-on-year growth of 23.7%. Preliminary research indicates that, in 2016, expenditures on public and private cloud services in CEE increased by 24.9% year on year. Expenditure on public cloud services grew a healthy 25.4% to $770 million in 2015, and, in H1 2016, the CEE public cloud market posted 23.1% growth compared with H1 2015.
Through 2020, IDC projects spending on cloud services in CEE to expand at a compound annual growth rate (CAGR) of 23.7%. That means total public and private cloud services expenditures will reach $2.5 billion in 2020.
Cloud solutions are gaining a strong position across industries. In the professional services field, for example, they are helping user organizations to concentrate almost exclusively on their area of expertise by offloading their IT requirements. In the finance and utility sectors, could is enabling businesses to transform, by reducing their in-house IT demands and develop more agile and effective business models. In general, cloud is a tool for speeding up innovations and achieving savings on areas of IT that do not contribute to competitive advantage.
Cloud is replacing traditional outsourcing categories, and the trend of moving infrastructure and workloads from internal server systems to commercial datacenters, and from internal management to a third-party provider, will only gain strength in the next five years. Consequently, on-premises software is being cannibalized by cloud-delivered SaaS and PaaS, and hardware by cloud-delivered IaaS. “In the years to come, the volume of deployed pure cloud offerings as a standalone service will decrease, while demand for cloud services as support for business transformations will grow,” notes Petr Zajonc, program manager at IDC. “More and more 3rd Platform components involving mobility, social media, Internet of Things, and analytics technologies will be delivered as part of complex solutions.”
From the vendor perspective, cloud services remain the most competitive and diverse IT sectors in CEE. In the coming years, global and local providers, new players and traditional IT companies, IT vendors, telecommunications operators, and non-IT businesses will all vie for market shares. Local cloud services providers will struggle to compete with international players in most areas, except for delivering infrastructure as a service (IaaS). IDC has noted that a significant number of CEE end-user companies prefer their IaaS provider to have a nearby physical location with support in the local language.
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