Report: Cloud market to reach $109 billion this year

Businesses around the world are beginning to leverage the cloud with new confidence, as the technology promises to deliver a number of opportunities that were not possible in the past. While this trend is happening on a global scale throughout the private sector, small companies, in particular, are leveraging cloud-based solutions in an effort to gain a competitive advantage over rival enterprises that have more disposable resources.

A recent report by Gartner highlighted the global cloud adoption phenomenon, noting that the market for public cloud computing services is forecast to grow more than 19 percent in 2012, totaling roughly $109 billion in revenue.

“The total public cloud services market size in 2011 was $91.4 billion and it will grow to $206.6 billion in 2016,” said Ed Anderson, research director at Gartner.

Some cloud segments garner more attention
Although the overall public cloud market is expanding each year, some models and services are gaining momentum faster than others. Analysts believe cloud-based business process management software, for example, will be the largest section of the growing cloud industry. Business Process-as-a-Service, or BPaaS, is forecast to generate more than $84 billion in revenue this year, up from $72 billion in 2011, Gartner reported.

Software-as-a-Service, or SaaS, is expected to be the second-largest segment of the cloud market in 2012, generating more than $14 billion in revenue, Gartner noted. SaaS is sometimes considered the cloud segment with the most opportunity, as it often includes cloud-based CRM and other mission-critical tools needed to enhance efficiency.

“The cloud services market is clearly a high-growth sector within the overall IT marketplace,” Anderson said. “The key to taking advantage of this growth will be understanding the nuances of the opportunity within service segments and geographic regions, and then prioritizing investments in line with the opportunities.”

Other important business strategies are also moving to the cloud. According to a separate report by Hypatia Research, cloud-based ERP is slowly gaining traction. The advancement of cloud-based ERP suggests that overall business processes are migrating to the hosted environment so decision-makers can have more control over operations while simultaneously boosting productivity and reducing IT expenses.

As cloud computing continues to mature and evolve, the task of migrating operations to the hosted environment will continue, especially as small firms look to stay competitive in today’s ongoing turbulent economy.