Cloud computing has become mainstream, with over 90% of enterprises now using cloud services in some form. But within that broad adoption, companies are utilizing the cloud in different ways. Let‘s dive deeper into the stats around how companies are leveraging cloud platforms in 2023.
The Major Cloud Providers
The cloud market continues to be dominated by the major providers like AWS, Microsoft Azure, and Google Cloud Platform.
- AWS holds a 32% share of the worldwide public cloud services market. AWS reported revenue of $80 billion in 2022.
- Microsoft Azure is second with 21% market share. Azure revenue hit $60 billion in 2022.
- Google Cloud trails at 11% market share, with revenue of $23 billion in 2022.
Other top providers include Alibaba Cloud, IBM Cloud, and Oracle Cloud, each holding 2-5% market share.
Public vs. Private vs. Hybrid Cloud Adoption
When adopting cloud computing, companies can choose between public, private or hybrid models:
- Public cloud – Using a public cloud provider like AWS, Azure or GCP. Most common option.
- Private cloud – Having a proprietary cloud infrastructure just for your organization. Gives more control but requires own resources to build and maintain.
- Hybrid cloud – Combining public and private cloud resources. Allows apps and data to move between them.
According to Flexera‘s 2021 State of the Cloud Report, 84% of enterprises have a multi-cloud strategy combining different models. Only 16% are solely using public cloud, while adoption of private cloud decreased.
The Growth of IaaS, PaaS and SaaS
There are 3 main categories of cloud computing services:
- IaaS (Infrastructure-as-a-Service) – Provides building blocks for cloud IT like servers, storage, and networking. Popular IaaS platforms include AWS, Azure, GCP.
- PaaS (Platform-as-a-Service) – Managed cloud environment to build, run and manage apps without maintaining infrastructure. Examples: AWS Elastic Beanstalk, Azure App Service, Heroku.
- SaaS (Software-as-a-Service) – On-demand access to application software. Leading examples are Microsoft 365, Salesforce, Workday.
SaaS continues to dominate the worldwide public cloud services market, accounting for 63% of total spending in 2022 compared to 61% in 2021. IaaS is the second largest category, representing 33% of the market.
Top Cloud Adoption Trends for 2023
Based on industry research and expert projections, the top trends shaping cloud adoption in 2023 include:
- Multi-cloud and hybrid cloud environments becoming the norm. Using multiple public clouds and integration with private cloud.
- Growth of serverless computing for app development, reducing operational costs.
- Artificial intelligence being embedded into more cloud services and platforms.
- Edge computing growth, distributing computing power closer to end users and devices.
- More enterprise workloads like ERP and data analytics moving to the cloud.
- Cloud-native approach for app design and development rather than lift-and-shift migrations.
Cloud Budgets Continue to Increase
With the accelerated adoption of cloud solutions, companies are dedicating bigger chunks of their IT budgets to the cloud:
- Worldwide spending on public cloud services grew from $219 billion in 2021 to $312 billion in 2022.
- Over 50% of IT infrastructure budgets are now allocated to the public cloud according to a Flexera survey.
- The average cloud budget increased by 23% in 2021 compared to just 6% increase for non-cloud IT budgets according to IDG.
Clearly companies are betting bigger on the cloud. IDC predicts worldwide spending on public cloud services will reach $1.3 trillion by 2025.
The Outlook for Cloud Computing
Cloud adoption was already strong before COVID-19, but the pandemic served as a forcing function for companies to digitally transform. Moving business-critical workloads like ERP systems to the cloud enables flexibility and business continuity. As companies shift their mentalities towards being "cloud-first", adoption will only grow. While security and compliance concerns do persist, the many benefits of scalability, efficiency and resilience provided by the cloud model make it an indispensable part of modern IT environments. We can expect to see companies utilize multi-cloud and hybrid cloud strategies even more in the future.
