The public cloud services market will be worth $204bn in 2016 as demand for outsourced IT services continues to rise, according to data from Gartner.
The figure of $204bn represents a 16.5 percent increase from $175bn in 2015, which Sid Nag, research director at Gartner, said underlined the huge demand for outsourced cloud services among firms of all types.
"The market for public cloud services is continuing to demonstrate high rates of growth across all markets, and Gartner expects this to continue through 2017," he said.
"This strong growth continues to reflect a shift away from legacy IT services to cloud-based services due to the increased trend of organisations pursuing a digital business strategy."
Infrastructure-as-a-service (IaaS) offerings will account for the bulk of this growth, rising 38 percent to account for $22.4bn, and Nag noted that large enterprises increasingly use cloud-based IaaS for their needs.
"IaaS continues to be the strongest growing segment as enterprises move away from data centre build-outs and move their infrastructure needs to the public cloud," he said.
"Certain market leaders have built a significant lead in this segment, so providers should focus on creating differentiation for success."
Another area of growth will be software-as-a-service application offerings, which will rise by 20 percent in 2016 to generate sales of $37.7bn as software vendors continue to shift to cloud-based delivery models for their tools.
Cloud security services will grow too, although they account for only $6.2bn of the total, up from $5bn in 2015. Platform-as-a-service offerings will account for an even smaller amount at $4.6bn, up from $3.8bn in 2015.
Interestingly, however, the biggest area of spending will be cloud advertising, which will account for $90bn of the market, and relates to firms buying ad space on sites in real time, based on user profiles, rather than bulk display buying.
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