thodonal - stock.adobe.com

APAC cloud spending up by over 38% in 2020

Public cloud infrastructure services made up the lion’s share of cloud spending last year as APAC organisations strive to modernise their IT infrastructure amid the pandemic, study finds

Organisations across the Asia-Pacific (APAC) region have been adjusting to the new normal and reinventing themselves to thrive in the post-pandemic world.

Take Globe Telecom in the Philippines, for example. Earlier this year, it moved most of its technology infrastructure to Amazon Web Services (AWS) in a bid to adapt to business demands at a much faster pace.

Companies such as Globe have been spurring the region’s public cloud market, with spending on public cloud services growing by over 38% to reach $36.6bn in 2020, according to IDC’s latest figures.

With more companies looking to modernise their legacy infrastructure, infrastructure-as-a-service (IaaS) remains the top contributor to overall public cloud spending in 2020, with a 48% share of the market.

This includes spending on compute, storage and networking, all of which will continue to have healthy demand throughout IDC’s forecast period of 2021 to 2024, with compute taking the lion’s share of IaaS spending.

Then comes software-as-a-service (SaaS), the second largest contributor to overall cloud spending in the region with a share of around 40%, followed by platform-as-a-service (PaaS) with an 11% share in 2020.

APAC organisations spent most of their SaaS budgets on cloud hosted applications and are expected to spend even more on collaboration, productivity and security tools to support remote working and innovation.

With the acceleration of digital transformation projects that will create a surge in data, spending on data management software is slated to grow at a five-year compound annual growth rate (CAGR) of 41.2%, accounting for the bulk of PaaS spending in the region.

“Covid-19 made us realise that no business is 100% invulnerable, however enterprises who were ahead on the digital transformation curve were able to sustain operations during the pandemic and recover well from the crisis than the laggards,” said Ashutosh Bisht, senior research manager at IDC Asia-Pacific.

“During this time, cloud services became the underpinning technology, integrated with technologies such as DevOps, artificial intelligence and big data analytics. Organisations were able to reimagine their business by continuously innovating and delivering to the end user,” he added.

The keenest adopters of public cloud services last year were those in professional services (15% share), banking and discrete manufacturing (around 10% each). These industries accounted for one third of overall public cloud spending throughout the forecast period.

However, the construction and professional services (due to increased focus on external facing interactions and customer experience) sectors will see the fastest growth in public cloud spending with a five-year CAGR of 39% and 35% respectively.

In terms of company size, the largest enterprises with more than 1,000 employees will have the biggest appetite for public cloud services, accounting for 37.1% of total spending.

However, small and medium-sized enterprises will see the fastest growth in public cloud spending during the forecast period as they were hardest hit by pandemic and have immediate needs for business continuity and resiliency.

On a geographical perspective, China was the largest market for public cloud services in 2020 having spent $19.4bn, followed by Australia ($5.2bn) and India ($3.5bn).

APAC’s rising cloud adoption has drawn suppliers to increase their investments in the region. Google Cloud is reportedly assessing opportunities for new cloud regions in Southeast Asia while AWS is opening a new cloud region in Melbourne by the second half of 2022.

Read more about cloud in APAC

Content Continues Below

Read more on Cloud computing services

SearchCIO
SearchSecurity
SearchNetworking
SearchDataCenter
SearchDataManagement
Close