In a recent report, the International Data Corporation (IDC) has projected substantial expansion in the Public Cloud Services (PCS) market across the Asia/Pacific excluding Japan and China (APeJC) region. According to the findings, the PCS market is set to achieve a significant milestone, with an estimated value of $39.4 billion in 2023. This marks a remarkable year-on-year growth of 21.3%. The market is poised for continued expansion, with IDC forecasting a noteworthy upswing to $83.1 billion by 2027, exhibiting a compelling five-year Compound Annual Growth Rate (CAGR) of 20.6%.
The year 2022 witnessed impressive strides, with the market reaching $32.5 billion and showcasing a remarkable year-on-year growth of 25.3%. Among the segments, Software as a Service (SaaS) emerged as the dominant force, securing over 60% of the total PCS market share in 2022.
Conversely, Platform as a Service (PaaS) constituted a smaller share, accounting for less than 15% of the total market. However, the PaaS segment demonstrated the most rapid expansion, with an a year-on-year growth rate of 45.1% in 2022. This surge was largely fueled by the integration of artificial intelligence (AI) platforms, data management software, and application platforms.
The continued growth of the public cloud services market
The transition towards digital business strategies has been a driving force behind the escalating adoption of public cloud services. Organizations are increasingly leveraging these services to expedite time-to-market, establish data-driven business models for informed decision-making, introduce personalized and innovative offerings, and engage customers in more interactive ways.
Interestingly, concerns about security and compliance have taken a backseat as organizations recognize the shared responsibility model and acknowledge the potential for heightened security and cost-efficiency in the public cloud environment, surpassing on-premises alternatives.
The regulated industries have also caught onto the momentum, with many adopting public cloud services due to the certifications aligning with global security standards and industry-specific compliances.
In the digital banking sector, both virtual and traditional banks are turning to PCS to launch digital banking services while complying with regulatory requirements. This emphasis on security and compliance is a prominent criterion in the selection of cloud service providers.
The landscape of major PCS vendors is dominated by Amazon Web Services (AWS), Google, Microsoft, Salesforce, and SAP, collectively capturing more than 40% of the market share in 2022. While China-based vendors like Alibaba Group and Huawei are gaining ground, especially in the Infrastructure as a Service (IaaS) domain in Southeast Asia, they are also making strides in Platform as a Service (PaaS) and Software as a Service (SaaS) offerings.
Enterprises will scrutinize excessive cloud expenditures and continue modernizing legacy systems through the utilization of public cloud services. The central emphasis will be on automation, highlighting the adoption of technologies such as serverless computing, robotic process automation (RPA) software, and artificial intelligence/machine learning (AI/ML) tools to enhance the efficiency of both business and IT operations, leading to cost reduction.
Source: IDC
