Gartner: Cloud Computing To Be Majority of New IT Spending by 2016

The use of cloud computing is projected to account for the majority of new IT spending by 2016, according to a recent Gartner, Inc. report. Additionally, 2016 is forecast to be a defining year for cloud, as private cloud begins to give way to hybrid cloud, and nearly half of all large enterprises are expected have hybrid cloud deployments by the end of 2017.

“Overall, there are very real trends toward cloud platforms, and also toward massively scalable processing,” said Chris Howard, Gartner research vice president. “Virtualization, service orientation and the Internet have converged to sponsor a phenomenon that enables individuals and businesses to choose how they’ll acquire or deliver IT services, with reduced emphasis on the constraints of traditional software and hardware licensing models. Services delivered through the cloud will foster an economy based on delivery and consumption of everything from storage to computation to video to finance deduction management.”

A few of the highlights from the report include:

  • Cloud services revenue in India is projected to have a five-year compound annual growth rate (CAGR) of 33.2 percent between 2012 and 2017 across all segments of the cloud computing market.
  • Software-as-a-service (SaaS) is projected to have an even higher CAGR of 34.4 percent.
  • Infrastructure-as-a-service (IaaS) is projected to have a CAGR of 39.8 percent.
  • Private cloud generates a lot of attention and is today the most popular form of cloud across various sectors.
  • However, private cloud is not appropriate for all services and, while the majority of midsize and large enterprises will deploy private cloud services over the next few years, private cloud is forecast to be used only for specific services.
  • Enterprises building cloud computing strategies should focus those strategies on these three segments: the enterprise as a consumer of cloud services, the IT-related capabilities delivered as a service to the enterprise, and the enterprise as a provider of cloud services.
  • The main goal when forming cloud computing strategies is determining if, when, where, how and why cloud services should be used.
  • IT should partner with the business to explore where the service delivery model, agility and elasticity attributes of the cloud style of computing support business optimization and innovation.

“Cloud computing continues to grow at rates much higher than IT spending generally. Growth in cloud services is being driven by new IT computing scenarios being deployed using cloud models, as well as the migration of traditional IT services to cloud service alternatives,” said Ed Anderson, Gartner research director.

(For additional information, contact: Gartner Inc.,

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