Aussie public cloud spending to hit $9B post-COVID

Aussie public cloud spending to hit $9B post-COVID

Will see a rise in spending of roughly 18 per cent in 2021 and 2022

Credit: Dreamstime

Australian spending on public cloud services is set to rise by 10.4 per cent year-on-year in 2020 to reach $8.8 billion.

According to research firm Gartner, the bumper year will be followed by annual increases of 18.2 per cent in 2021, up to $10.4 billion, followed by 18.5 per cent in 2022, to $12.3 billion.

Broken down, cloud application services will account for more than half the 2020 Australian public cloud market, sitting at $4.9 billion

By comparison, the global average of public cloud spending is expected to increase by only 6.1 per cent this year, to US$257.5 billion, with cloud application services also forecast to be the largest global market segment at US$101.5 billion.

Beyond this, the global public cloud market's short-term future is forecast to grow similarly to Australia, rising by 18.4 per cent in 2021, to US$305 billion, followed by growth of 18.8 per cent in 2022, to US$362.3 billion. 

Gartner also claimed that public cloud spending is on an upward trajectory as nearly 70 per cent of organisations that currently use cloud services are set to increase their spend on the technology due to the disruption wrought by the coronavirus pandemic. 

Sid Nag, research vice president at Gartner said the pandemic saw organisations pivot to focus on cost preservation and optimisation, remote working support and resiliency — with cloud investments being a “convenient means” in addressing all three areas. 

“The pandemic validated cloud’s value proposition,” he said.“The ability to use on-demand, scalable cloud models to achieve cost efficiency and business continuity is providing the impetus for organisations to rapidly accelerate their digital business transformation plans. 

"The increased use of public cloud services has reinforced cloud adoption to be the ‘new normal,’ now more than ever.” 

The global public cloud spend isn’t expected to stop growing in 2022 as Gartner’s growth outlook extends as far as 2024, with the market segment forecast to make up 14.2 per cent of the total global enterprise IT spending market in that year, as opposed to the projected 9.1 per cent in 2020. 

This is expected to be driven by investments in mobility, collaboration and other remote working technologies, with cloud service providers partnering with telecommunications companies to extend their reach into the edge and support a hybrid workforce potentially also being a factor. 

“As CIOs think more strategically about how to lay the foundations to support a return to growth, it is clear that the move to digital and associated services will play a big role for organisations in the future,” Nag said.  

“Cloud adoption therefore becomes a significant means to stay ahead in a post-COVID-19 world focused on agility and digital touchpoints.” 

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