Worldwide Public Cloud End-User Spending To Surpass $675 Billion In 2024: Gartner
This spending growth is being driven by gen AI-based applications at scale and application modernisation.
Worldwide end-user spending on public cloud services is forecast to grow 20.4% to total $675.4 billion in 2024, up from $561 billion in 2023, according to a forecast by research and consulting firm Gartner Inc. This growth is being driven by generative AI-enabled applications at scale and application modernisation.
All segments of the cloud market are expected to see growth in 2024. Cloud system infrastructure-as-a-service is forecast to experience the highest end-user spending growth at 25.6% (from 19.1% in 2023), followed by cloud application platform-as-a-service at 20.6% (19.5% in 2023).
“The continued growth we expect to see in public cloud spending can be largely attributed to gen AI due to the continued creation of general-purpose foundation models and the ramp up to delivering gen AI-enabled applications at scale,” said Sid Nag, vice president analyst at Gartner. “Because of this continued growth, we expect public cloud end-user spending to eclipse the one trillion dollar mark before the end of this decade.”
While cloud infrastructure and platform services are driving the highest spending growth, cloud application software-as-a-service remains the largest segment of the cloud market in end-user spending. SaaS spending is projected to grow 20% (18.1% in 2023) to total $247.2 billion in 2024.
“The need for infrastructure to undertake AI model training, inferencing and fine tuning has only been growing and will continue to grow exponentially and have a direct effect on IaaS consumption,” said Nag.
Organisations are continuing to increase their usage of cloud for specific use cases such as AI, machine learning, internet of things and big data, which is driving SaaS growth. SaaS spending is being driven by applications being modernised by independent software vendors to run in a SaaS-based consumption model, Nag added.
