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Today, anybody familiar with the cloud is using it to run their online service or back up their data on it. But according to an IDC report, the public spending on cloud services is expected to double the projected spending of $96.5 billion in 2016. The worldwide public spending in 2020 is expected to be more than $195 billion.

This huge change represents a compound annual growth rate(CAGR) of about 20.4 per cent over the 2015-2020 forecast period. In 2015, software-as-a-service(SaaS) and platform-as-a-service(PaaS) together added for about 83.7 per cent of the total public cloud revenue, while the remaining 16.3 per cent gap was filled in by Infrastructure-as-a-service.

In addition to this, the forecast also sheds light on the fact that the revenue share of IaaS and PaaS is expected to grow at a rate faster than SaaS. This means that software(CRM, marketing apps) services, built in the cloud will grow but at a pace slower than the actual cloud architecture. Their share would be taken over by prominent infrastructure service providers, such as AWS or Microsoft Azure. So, now it seems that Microsoft CEO Satya Nadella was right for laying more focus on cloud rather than the previously over-important Windows operating system.

Commenting on the same, Benjamin McGrath, senior research analyst, SaaS and Business Models, adds,

Cloud software will significantly outpace traditional software product delivery over the next five years, growing nearly three times faster than the software market as a whole and becoming the significant growth driver to all functional software markets.

By 2020, about half of all new business software purchases will be of service-enabled software, and cloud software will constitute more than a quarter of all software sold.

Also, IDC surveyed the public cloud computing purchases by 20 industries across eight regions and 54 countries. After doing so it came to the conclusion that the industries leading the public spending are manufacturing, banking, and professional services. They currently account for more than third of the total revenue but are expected to be replaced by media, telecommunications, and retail in coming five years.

The report also mentions that all eight regions are forecast to see revenue growth greater than 100% over the next five years. But Unites States with two-thirds of the total revenue will be the largest market for public cloud services throughout the forecast, followed by Western Europe and the Asia/Pacific(excluding Japan) region.

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