Public Cloud - G7

Revenue in the Public Cloud market in the G7 is projected to reach US$523.30bn in 2024.
Software as a Service is expected to dominate this market, with a projected market volume of US$250.10bn in 2024.
Additionally, revenue in the G7 is anticipated to show an annual growth rate (CAGR 2024-2029) of 18.11%, which would lead to a market volume of US$1,203.00bn by 2029.
In a global context, the majority of revenue will be generated the United States, amounting to US$388.50bn in 2024.
The United States continues to lead the G7 in public cloud adoption, driven by robust demand for innovative digital transformation solutions across various industries.

Key regions: United States, Germany, China, Japan, United Kingdom

Definition:

A public cloud is defined as the digital infrastructure and computing resources that are managed by a service provider. Examples of public cloud computing resources include virtual machines, storage, and services, all of which are available for purchase with flexible (e.g., pay as you go and subscription) business models. Such payment options make it possible for customers to access, scale, and utilize resources as needed. Public cloud solutions make it possible for users to save on IT costs, increase their efficiency, and take advantage of advanced technologies without having to invest in long-term IT solutions. Public cloud service providers own and maintain the physical infrastructure, hardware, and software. Users only need to pay for the computing resources that they require. The Public Cloud market refers to the companies that provide these cloud computing resources and services to individuals, businesses, and organizations.

Structure:

The Public Cloud market is structured into five markets based on the type of service models provided by the companies.

The Infrastructure as a Service (IaaS) market covers the resources and services related to the data center infrastructure.
The Platform as a Service (PaaS) market covers the resources and services related to the virtual environments used for software development.
The Software as a Service market (SaaS) market covers the resources and services related to software applications that can be accessed via a web browser.
The Business Process as a Service (BPaaS) market covers the resources and services related to the various business processes such as finance and accounting, human resources, customer service, and supply chain management, all delivered through the cloud.
The Desktop as a Service (DaaS) market covers the resources and services related to virtual desktop environments, which are accessible from any device with an internet connection.

Additional Information:

The public cloud market comprises revenue, revenue change, average spend per employee, and key player market shares as key performance indicators. Only revenues that are generated by primary vendors at the manufacturer price level either directly or through distribution channels (excluding value-added tax) are included, and revenues generated by resellers are excluded. Revenues are generated through both online and offline sales channels and include spending by consumers (B2C), enterprises (B2B) as well as governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed.

Key players of the public cloud market include companies such as Amazon (Amazon web services), Microsoft (Azure), Google (Cloud), and IBM (Cloud).

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Analyst Opinion

The Public Cloud market in G7 is experiencing steady growth driven by factors such as increasing demand for digital solutions, rising awareness of cloud services, and the convenience offered by online platforms. The market's average growth rate can be attributed to the growing adoption of Infrastructure, Platform, Software, Business Process, Desktop, and Disaster Recovery as a Service. Regulatory changes and advancements in technology also impact the market's growth rate.

Customer preferences: As the use of public cloud services continues to grow in the G7 countries, consumer preferences are shifting towards more advanced and personalized digital solutions. This trend is driven by the increasing demand for seamless and convenient access to data and applications. With the rise of remote work and virtual communication, there is a growing need for cloud-based collaboration tools and video conferencing platforms. Additionally, the shift towards a more digital lifestyle has led to a greater reliance on online shopping and e-commerce, creating a need for secure and reliable cloud-based payment processing and storage solutions. This trend is expected to continue as consumers become more accustomed to the convenience and flexibility that public cloud services offer.

Trends in the market: In the G7 countries, the Public Cloud Market is experiencing a surge in demand for hybrid cloud solutions, as businesses seek to combine the scalability of public cloud with the security of private cloud. This trend is expected to continue as more companies prioritize agility and cost-effectiveness in their IT infrastructure. Additionally, there is a growing emphasis on multi-cloud strategies, as organizations look to leverage the strengths of multiple cloud providers. This trend is significant as it offers businesses greater flexibility and resilience, but it also presents challenges in terms of data management and integration. For industry stakeholders, there is a need to adapt to these trends by offering comprehensive hybrid and multi-cloud solutions, as well as developing strategies to address the complexities of managing multiple cloud environments. Failure to do so may result in falling behind in the highly competitive public cloud market.

Local special circumstances: In Japan, the Public Cloud Market is experiencing rapid growth driven by the country's advanced technology infrastructure and high demand for digital transformation in various industries. Additionally, Japan's strict data privacy laws and regulations have created a favorable environment for cloud providers to ensure security and compliance. Furthermore, the country's aging population has led to a surge in demand for healthcare solutions, driving the adoption of cloud-based electronic health records and telemedicine services.

Underlying macroeconomic factors: The Public Cloud Market is significantly impacted by macroeconomic factors such as technological advancements, government policies, and overall economic health. Countries with supportive regulatory environments and investments in digital infrastructure are experiencing a surge in demand for public cloud services. The global economic trends of digital transformation and the increasing adoption of remote work are also driving the growth of the public cloud market. Furthermore, the rise in data generation and the need for data storage and analysis is fueling the demand for public cloud solutions. This market is expected to continue its growth trajectory, with the increasing reliance on technology in various industries and the proliferation of IoT devices.

Methodology

Data coverage:

The data encompasses B2B, B2G, and B2C enterprises. Figures are based on the money spent at manufacturer price level (excluding VAT).

Modeling approach / Market size:

Market sizes are determined through a top-down approach with a bottom-up validation, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of the market-leading companies and reports from our primary research. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP and level of telecommunications infrastructure. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. The main drivers are the GDP and the level of digitization.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level.