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Cloud infrastructure services market to record 36% growth

cloud infrastructure

The cloud infrastructure services market is forecast to grow by $143.62 billion between 2021 and 2026, accelerating at a CAGR of 11.7% according to a new report by Technavio.

The shift from the CAPEX model to the OPEX model will be the key growth driver in the market. In addition, the need to optimize project management and business processes and the rise in the adoption of hybrid cloud storage systems will have a positive impact on the growth of the market. But the latency in the cloud network and data privacy and security concerns are expected to reduce the growth potential in the cloud infrastructure market.

By deployment, the market is classified into public cloud, private cloud and hybrid cloud. The public cloud segment will contribute significantly to the growth of the market.

By geography, the market is classified as North America, APAC, Europe, South America, and the Middle East and Africa. North America will have the largest share of the market, according to the report ‘Cloud Infrastructure Services Market by Deployment and Geography – Forecast and Analysis 2022-2026’.

The global cloud infrastructure services market is fragmented. The market comprises some well-established players that are engaged in the development of email hosting solutions for various end-user industries and customers. Vendors are continuously working to develop secure hosting solutions for their customers. The competition in the market is expected to intensify further with an increase in service extensions, technological innovations, and M&As.

The global cloud infrastructure services market is expected to grow at a significant rate during the forecast period and is fragmented due to the presence of numerous players. Most of the large and established players have extensive sales and distribution networks globally, whereas most smaller players are concentrated in regional markets. Vendors compete based on parameters such as technology, brand identity, and innovation. Moreover, vendors are adopting pricing and marketing strategies to retain their existing market shares and seize new market opportunities. Hence, the competition among the vendors of the market in focus is expected to remain moderate during the forecast period.

Latency in the cloud network is one of the factors hampering the cloud infrastructure services market growth. One of the most significant issues that cloud-based networks confront is a delay in data transfer when retrieving information from public cloud infrastructure. There are multiple factors for latency, such as distributed computing, virtualization, and prioritizing traffic. When the cloud environment is larger, it becomes less predictable, and an increase in the workload leads to high variability in service delivery. In the case of VMs, separate networks can lead to packet delays. If the wide area network (WAN) on the customer network is busy, it might lead to a significant effect on latency. Data exchanges between cloud services can lead to much higher latency. This delay in data transfer can result in an increased cost to the users of multiple cloud service providers. Thus, the latency in the cloud network can hinder the adoption of cloud infrastructure services during the forecast period.

Some of the companies covered in the cloud infrastructure services report are Alibaba Group Holding Ltd., Alphabet Inc., Inc., Cisco Systems Inc., Dell Inc., DigitalOcean Holdings Inc., Fujitsu Ltd., GTT Communications Inc., Hewlett Packard Enterprise Co., International Business Machines Corp., Microsoft Corp., NTT Communications Corp., Oracle Corp., OVH Groupe SA, Rackspace Technology Inc., Salesforce Inc., Samsung Electronics Co. Ltd., SAP SE, Tencent Holdings Ltd., Verizon Communications Inc., and VMware Inc.

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