Public Cloud Market Size, Share & Trends Analysis Report By Service (Infrastructure as a Service (IaaS), Platform as a Service (PaaS), Software as a Service (SaaS)), By Enterprise Size, By End Use, By Region, And Segment Forecasts, 2024 - 2030

Report Overview

The public cloud market size was estimated at USD 636.47 billion in 2023 and is expected to experience a compound annual growth rate (CAGR) of 17.0% from 2024 to 2030. Digital transformations and intelligence upgrades have become inevitable for businesses as numerous industries adopt advanced technologies. The growing inclination towards public cloud services is primarily driven by benefits such as cost savings, faster deployment, and flexibility. Companies utilize public cloud services, including data storage, web-based emails, networking, organizational applications, scaling computing resources, and more.

The emergence and increasing adoption of modern technologies such as Artificial Intelligence (AI), machine learning, and others have facilitated the growth of cloud services as businesses seek advancements in technical capabilities. The increasing dependence on data-driven technologies for multiple business functions, the rise in demand for real-time analysis and insights sharing, the growing requirements for data storage, and the rising frequency of communication with customers through different mediums are some major factors driving demand for public cloud.

In recent years, businesses from multiple industries have transformed internal operation structures and enhanced capacities in numerous ways, including the adoption of solutions and services related to regulatory compliance management, data storage, data protection and recovery, network transformation, green technology & sustainability, in-memory analytics, software-defined networking, and more. For instance, in May 2024, Subway IP LLC, one of the major participants in the quick service restaurant market, rolled out the next phase of the brand’s digital experience across Germany, the UK, and Finland markets. The interactive self-serve kiosks model, introduced by the brand in multiple restaurants across these markets, is equipped with end-to-end digital order management technology delivered by Vita Mojo. Some of its locations have also adopted advanced digital menu boards to share information about special menu offerings, promotions, and the latest developments.

Increasing demand for online streaming services and on-demand videos in the entertainment and media industry is also contributing to the growth of the public cloud market. Businesses in this industry prefer the public cloud due to multiple factors, such as the increasing demand for personalized service delivery in online entertainment. For instance, the ability to handle real-time traffic demands, scalability, streamline workflows, manage customized user experiences, reduce infrastructural costs, and improve security offered by cloud technology is expected to generate greater demand in the entertainment and media industry during the forecast period.

The use of cloud technology by e-commerce websites is also adding to the growth opportunities for this market. Typically, online shopping platforms experience huge traffic and sales during seasonal demand cycles. Cloud technologies assist these businesses to expand their online services and cater to rising demand quickly. Once the sale reaches the regular volume, businesses can scale down while paying only for the time they availed of added capacities. Increasing migrations of retail websites to cloud technology to ensure improved capabilities and establishment of sustainable business models are generating an upsurge in demand for the public cloud market. For instance, in April 2024, Home Depot, a retail business that offers home improvement tools, appliances, products, and services, extended its multi-year strategic relationship with Google Cloud to accelerate its technology transformation and process enhancements.

Services Insights & Trends

The Software as a Service (SaaS) segment dominated the market with a revenue share of 54.0% in 2023. This segment is primarily influenced by factors such as accessibility without local installations, remote monitoring, reduced burden on IT teams through seamless upgrades, cost efficiency attained through subscription-based payments, and diverse SaaS applications. Businesses from various industries focus on adopting emerging technologies to improve user experiences and accomplish operational efficiencies. SaaS offerings play a vital role in these digital transformation processes.

The Infrastructure as a Service (IaaS) segment is expected to grow at the fastest CAGR during the forecast period. Growth of this segment is primarily influenced by the rapid rate of digital transformation activities in numerous industries, including banking, financial services and insurance, IT & telecom, retail, manufacturing, and others. Companies prefer to adopt pay-as-you-go models as they allow minimal investments in hardware and software. Cost efficiency attained by accommodating Infrastructure as a Service (IaaS) has been attracting multiple small and medium-scale enterprises towards this segment. SMEs prefer renting servers, storage systems, virtual machines, hardware, and other equipment and only pay for support, licenses, etc., as they choose public cloud services.

Enterprise Size Insights & Trends

Based on enterprise size, the large enterprises segment held the largest revenue share of the industry in 2023. This is attributed to factors such as the ability to deploy initial upfront investments, comparatively higher need for larger-scale technology deployments, remote monitoring and access requirements driven by presence in multiple locations and regions, operational complexities, and more. Large enterprises require cloud services to deploy advanced technologies such as AI or the Internet of Things, as these businesses are often characterized by geographically dispersed teams and remote working environments.

The SME segment is expected to experience the fastest CAGR from 2024 to 2030. This is driven by factors such as the inclination of small and medium-scale businesses to adopt a pay-as-you-go-based service, the unavailability of investment funds for private cloud deployments, and the availability of multiple services tailored by industry experts specifically for SMEs. Private cloud services necessitate paying for hardware, virtual machines, and servers, which adds to operational costs. SMEs prefer renting such equipment requirements and servers only for the specified time while paying for licenses, subscriptions, support, and more. These aspects are expected to grow in this segment during the forecast period.

End-use Insights & Trends

The BFSI segment dominated the global industry in 2023. The banking, financial services, and insurance industries have undergone rapid digital transformation. Companies operating in this industry have become highly dependent on data as the financial sector's digital footprint increases with customers using smartphones, online platforms, and related digital solutions. BFSI companies prefer public cloud services for multiple purposes, including storage, hosting applications, security, technology deployments, and more.

The manufacturing segment is expected to experience the fastest CAGR from 2024 to 2030. The growth of this segment is primarily driven by factors such as growing technology transformations in the industry fueled by the rapid adoption of automation solutions and the inclusion of emerging technologies such as AI and IoT in multiple business functions. Numerous manufacturing businesses worldwide focus on reducing operational costs by incorporating advanced technologies and enhancing productivity by reducing human involvement. For instance, in August 2024, BMW AG, one of the key companies in the automotive industry, announced the successful testing of a humanoid robot in the Spartanburg plant of the company. Such technological advancements and integration with existing and newly innovated equipment are expected to generate a greater need for public cloud services in the manufacturing industry.

Regional Insights

North America dominated the global public cloud market in 2023, with a revenue share of 39.2%. The growth of this market is primarily influenced by factors such as the presence of numerous key companies in the region, such as Google, Microsoft, Amazon, and others, growing digital transformation initiatives embraced by businesses operating in North America, and increasing demand for cloud services related to storage, data analytics, hosting, deployments, and more.

U.S. Public Cloud Market Trends

The U.S. public cloud market held the largest revenue share of the regional industry in 2023. This market is mainly driven by factors such as early adoption trends in technology advancements, continuous growth in the inclusion of tools and systems driven by AI and IoT in multiple industries, and rising use of public cloud services by SMEs in the country. Small and medium-scale businesses, which support nearly 4 million jobs, are the backbone of the country's economy. Public cloud services empower SMEs' growing embracement of modern technologies, as SMEs prefer renting servers and other equipment while relying on the pay-as-you-go model for related transformations. The increasing application of SMEs from various sectors such as IT & telecom, manufacturing, retail, healthcare, and others is expected to fuel growth in this market during the forecast period.

Europe Public Cloud Market Trends

Europe is identified as a significant region for the global public cloud market in 2023. According to Eurostat, 45.2% of enterprises in the EU purchased cloud computing services, which marked an increase of 4.2% from 2021. This is attributed to efforts by European nations and companies to attain digital sovereignty to control data and accomplish abilities to act independently in the modern digital world, rising investments by tech companies in the region, and the rapid rate of digital transformation activities. For instance, in May 2024, Amazon Web Services (AWS), one of the key companies in the public cloud market, announced that it plans to invest nearly USD 8.68 billion in AWS European Sovereign Cloud through 2040. The company plans to launch its first AWS region in Germany's State of Brandenburg by December 2025. These factors are expected to generate an upsurge in demand for the public cloud market in the area from 2024 to 2030.

Germany public cloud market is expected to experience noteworthy growth during forecast period. This is attributed to factors such as multiple large enterprises operating in automotive, manufacturing, defense, personal care, retail, and others undergoing digital transformations and intelligence upgrades. Increasing adoption of automation, including modern technologies such as IoT and AI, and inclination towards using public cloud solutions to ensure cost-effectiveness is projected to assist this market in growth.

Asia Pacific Public Cloud Market Trends

Asia Pacific public cloud market is expected to witness the fastest CAGR from 2024 to 2030. This is attributed to factors such as the growing application of public cloud technology in SMEs operating in the Asia Pacific region, the rapid pace of digital transformations in countries such as India, China, and others, the availability of multiple service providers within the area, and the concentration of large enterprises from manufacturing, automotive, food & beverages industries to reduce costs through technology integrations.

India public cloud market held a significant revenue share of the regional industry. This is mainly driven by the industry's increasing digital transformation activities, growing dependence on data, availability of cost-effective public cloud solutions and services offered by key companies from various regions, and a large number of SMEs focusing on deploying modern technology solutions.

Key Companies & Market Share Insights

Some of the key companies operating in the public cloud market include Amazon.com, Inc., Google, Microsoft, Alibaba Cloud, Tencent and others. To address increasing demand and growing competition, companies are adopting strategies such as portfolio enhancements, focus on customer centric service delivery, improved customer support, tie-ups with governments and other organizations, geographical expansions and more.

• Amazon Web Services, Inc., a subsidiary of Amazon, supplies on-demand cloud computing platforms and APIs to individuals, governments, and companies. It offers pay-as-you-go and metered services, which its clients often prefer in combination. Its cloud-based products are associated with computing, storage, analytics, network, management solutions, enterprise applications, and more.

• Google, one of the prominent companies in the technology, innovation, and IT industry, offers multiple products and services to businesses and individuals through its diverse portfolios. Its cloud solutions entail industry solutions, application modernization, artificial intelligence, APIs and applications, data analytics, databases, infrastructure modernization, productivity and collaboration, security, and others.

Recent Developments

• In May 2024, Telecom Egypt, a prominent service provider of communications and information technology, joined forces with Huawei Cloud Computing Technologies Co., Ltd. to introduce the first locally based public cloud platform by Huawei in Egypt and Northern Africa. The collaboration aims to host Huawei cloud in Telecom Egypt's data centers to ensure the reach across 60 countries while capitalizing on 14 submarine cable systems.

Public Cloud Market Report Scope

Global Public Cloud Market Report Segmentation

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2030. For the purpose of this study, Grand View Research has segmented the public cloud market report on the basis of service, enterprise size, end use, and region:

• Service Outlook (Revenue, USD Billion, 2018 - 2030)

  • Infrastructure as a Service (IaaS)

  • Platform as a Service (PaaS)

  • Software as a Service (SaaS)

• Enterprise Size Outlook (Revenue, USD Billion, 2018 - 2030)

  • SMEs

  • Large Enterprises

• End Use Outlook (Revenue, USD Billion, 2018 - 2030)

  • BFSI

  • IT & Telecom

  • Retail & Consumer Goods

  • Manufacturing

  • Energy & Utilities

  • Healthcare

  • Media & Entertainment

  • Government & Public Sector

  • Others

• Regional Outlook (Revenue, USD Billion, 2018 - 2030)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • Germany

    • UK

    • France

  • Asia Pacific

    • Japan

    • China

    • India

    • Australia

    • South Korea

  • Latin America

    • Brazil

  • Middle East & Africa

    • South Africa

    • Saudi Arabia

    • UAE