FRAMINGHAM, Mass.--(BUSINESS WIRE)--According to the latest forecast from the International Data Corporation (IDC) Worldwide Quarterly Cloud IT Infrastructure Tracker, total spending on IT infrastructure products (server, enterprise storage, and Ethernet switches) for deployment in cloud environments will increase by 15.5% in 2016 to reach $37.1 billion. This amount excludes double counting between storage and servers. In comparison, spending on enterprise IT infrastructure deployed in traditional, non-cloud, environments will decline by 4.4% in 2016, but will still account for the largest share, 63.4%, of end user spending. Spending on private cloud IT infrastructure will grow by 10.3% year over year to $13.8 billion with more than 60% of this amount contributed by on-premises private cloud environments. Spending on public cloud IT infrastructure will increase by 18.8% in 2016 to $23.3 billion.
All regions are expected to increase spending on cloud IT infrastructure in 2016 with investments in public cloud growing at a faster rate than investments in private cloud IT infrastructure. For cloud environments combined, spending on Ethernet switches will be growing at the highest rate, 39.5%, while spending on server and storage will grow at 11.4% and 14.2%, respectively.
For the long-term forecast, IDC expects that spending on IT infrastructure for cloud environments will grow at a 13.1% compound annual growth rate (CAGR) to $59.5 billion in 2020. This will represent 48.7% of the total spending on enterprise IT infrastructure. Spending on non-cloud IT infrastructure will decline at 1.4% CAGR during the same period. Within the cloud segment, spending on public and private cloud IT infrastructure will grow at 18.8% and 10.3% CAGR respectively. In 2020, IDC expects public cloud service providers (CSPs) will spend $38.4 billion on IT infrastructure for delivering services, while spending on private cloud IT infrastructure will reach $21.1 billion.
"Despite weakness in hyperscale CSP demand for IT infrastructure products in the first quarter, we expect spending on public cloud to increase in the second half of the year," said Natalya Yezhkova, research director, Storage Systems. "Overall, we will continue to see steady growth in demand for public cloud services and, as a result, underlying spending on IT infrastructure by CSPs. The economic and financial volatility we see in some regions will push demand further as increasing sophistication of public cloud offerings allows organizations to fulfill their needs across a growing variety of IT domains while OPEX-oriented pricing models provide some relief to tightening IT budgets."
An interactive graphic showing worldwide spending share for public cloud, private cloud, and traditional IT infrastructure over the 2015-2020 forecast period is available here. The chart is intended for public use in online news articles and social media. Instructions on how to embed this graphic can be found by viewing this press release on IDC.com.
IDC's Worldwide Quarterly Cloud IT Infrastructure Tracker is designed to provide clients with a better understanding of what portion of the server, enterprise storage systems, and networking hardware markets are being deployed in cloud environments. This tracker will break out vendors' revenue by the hardware technology market into public and private cloud environments for historical data and also provide a five-year forecast by the technology market.
Taxonomy Notes:
IDC defines cloud services more formally
through a checklist of key attributes that an offering must manifest to
end users of the service. Public cloud services are shared among
unrelated enterprises and consumers; open to a largely unrestricted
universe of potential users; and designed for a market, not a single
enterprise. The public cloud market includes variety of services
designed to extend or, in some cases, replace IT infrastructure deployed
in corporate datacenters. It also includes content services delivered by
a group of suppliers IDC calls Value Added Content Providers (VACP).
Private cloud services are shared within a single enterprise or an
extended enterprise with restrictions on access and level of resource
dedication and defined/controlled by the enterprise (and beyond the
control available in public cloud offerings); can be onsite or offsite;
and can be managed by a third-party or in-house staff. In private cloud
that is managed by in-house staff, "vendors (cloud service providers)"
are equivalent to the IT departments/shared service departments within
enterprises/groups. In this utilization model, where standardized
services are jointly used within the enterprise/group, business
departments, offices, and employees are the "service users."
For more information about IDC's Worldwide Quarterly Cloud IT Infrastructure Tracker, please contact Lidice Fernandez at 305-351-3057 or lfernandez@idc.com.
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