Public Cloud - Russia

Russia

Revenue in the Public Cloud market in Russia is projected to reach US$4,431.00m in 2024.
Software as a Service is expected to dominate the market in Russia with a projected market volume of US$1,514.00m in 2024.
Revenue in the Russian Public Cloud market sector is anticipated to exhibit an annual growth rate (CAGR 2024-2029) of 14.94%, leading to a market volume of US$8,889.00m by 2029.
In a global context, the majority of revenue will be generated the United States, amounting to US$388.50bn in 2024.
In Russia, the public cloud market is experiencing a significant shift towards increased localization and regulatory compliance, driven by national security concerns and digital sovereignty initiatives.

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 Russia is experiencing moderate growth, driven by factors such as increasing demand for digital services, growing awareness of the benefits of cloud computing, and the convenience of online solutions. The sub-markets of Infrastructure, Platform, Software, Business Process, Desktop, and Disaster Recovery play a significant role in shaping this market's growth. However, the mild growth rate can be attributed to factors such as data privacy concerns, limited internet infrastructure, and slow adoption of new technologies in the region.

Customer preferences: The rapid growth of the public cloud market in Russia can be attributed to the increasing adoption of digital solutions by consumers. This trend is driven by a desire for convenience and efficiency, as well as the need for remote access to services and data. As a result, there has been a surge in demand for cloud-based applications, including online shopping, entertainment, and communication tools. This shift towards digital lifestyles is also fueled by the younger generation's preference for technology-driven solutions in all aspects of their daily lives.

Trends in the market: In Russia, the Public Cloud market is experiencing a surge in demand, driven by the increasing adoption of cloud-based solutions by businesses of all sizes. This trend is expected to continue as companies prioritize digital transformation and remote work capabilities. It also presents opportunities for industry players to offer innovative and customized cloud services to cater to diverse business needs. Additionally, the rise of hybrid cloud solutions and the integration of AI and machine learning technologies in the cloud are expected to further propel the market's growth. This has implications for stakeholders, such as cloud service providers, who must keep up with the evolving technological landscape to remain competitive and meet the changing demands of the market.

Local special circumstances: In Russia, the Public Cloud Market is driven by the country's rapidly growing technology sector and the government's support for digital transformation initiatives. The market is also influenced by the unique geographical and cultural landscape, with a large population spread across a vast territory. Due to data privacy regulations, there is a strong demand for locally hosted cloud solutions, leading to the emergence of Russian-based cloud providers. Additionally, the country's complex political environment and sanctions from Western countries have created a need for domestically controlled cloud services, further fueling the growth of the Public Cloud Market in Russia.

Underlying macroeconomic factors: The Public Cloud Market in Russia is heavily influenced by macroeconomic factors such as the country's economic stability, government policies, and technological advancements. The steady growth of the Russian economy and government initiatives to promote digital transformation have led to an increase in demand for public cloud services. Additionally, the country's large population and growing number of small and medium-sized enterprises are driving the adoption of cloud technologies for cost-effective and scalable solutions. However, economic sanctions and political tensions may hinder market growth in the region.

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.