According to Gartner, cloud computing will be a major deciding factor for the IT spending. In 2016, the total amount of cloud shift is estimated to reach $111 billion, it added. As the cloud services tend to increase, this shift can increase to $216 billion in 2020.
“More than $1 trillion in IT spending will be directly or indirectly affected by the shift to cloud during the next five years,” pointed out Gartner.
Commenting on the growing influence of cloud services, Ed Anderson, research vice president at Gartner said, “Cloud-first strategies are the foundation for staying relevant in a fast-paced world. The market for cloud services has grown to such an extent that it is now a notable percentage of total IT spending, helping to create a new generation of start-ups and “born in the cloud” providers.”
Meanwhile, for calculating the cloud shift rates, Gartner has compared the IT spending on cloud services with traditional non-cloud services in the same market.
“Cloud shift is not just about cloud. As organizations pursue a new IT architecture and operating philosophy, they become prepared for new opportunities in digital business, including next-generation IT solutions such as the Internet of Things,” said Mr. Anderson.
“Furthermore, organizations embracing dynamic, cloud-based operating models position themselves better for cost optimization and increased competitiveness.”
Gartner has presented a Cloud Shift summary, which can be found in the below table:
|Legacy Segment||Cloud Segment||Total Market Size in 2016||Total Cloud Shift in 2016||Cloud Shift Rate through 2020|
|Business Process Outsourcing||BPaaS||$119 billion||$42 billion||43%
|Application Software||SaaS||$144 billion||$36 billion||37%|
|Application Infrastructure Software||PaaS||$177 billion||$11 billion||10%|
|System Infrastructure||IaaS||$294 billion||$22 billion||17%|
|BPaaS = business process as a service; IaaS = infrastructure as a service; PaaS = platform as a service; SaaS = software as a service|