IDC Says Worldwide PaaS Market is Growing Rapidly and Reach $14 billion by 2017

IDC estimates that between now and 2017 the market for PaaS solutions will increase by 30 percent annually, to reach a turnover of $14 billion by 2017. The jump from last year $3.8 billion to $14 billion will be due to the need for companies to reduce infrastructure costs and speed up application development.

The IDC study, “Worldwide Public Platform as a Service 2013-2017 Forecast,” said that PaaS volume of purchases in the coming years will grow by 30% per year, significantly outperforming the average growth rate of procurement in general (4%). Companies will increasingly go to the purchase of PaaS, understanding its competitive advantages and positioning of new information. In the official report, IDC states that the expected increase in spending for PaaS is due to the “fast acceptance of PaaS solutions, and greater market penetration of Microsoft Azure.

The first symptom is the flourishing growth of companies offering PaaS solutions focused on specific sectors, such as APaaS (application platform as a service), DPaaS (database platform as a service) and cloud-based test and IPaaS (integration platform as a service). In most cases, the new reality are supported by major companies such as, Microsoft and IBM.

The new generation of employees and managers, who grew up in the era of the Internet and mobile access is considered the norm, are accustomed to using not only data, but also the various Internet-based software tools. It is this generation, which is driving force for the transition to a new model of consumption of IT from the cloud.

It is not clear how significant acceleration in the development of PaaS applications affect the developers themselves. Companies can either increase the amount of development, or reduce staff, the report says. In general, companies are focusing their attention on services to the public PaaS, allowing to lower IT spending and at the same time create applications more quickly. The analysis by geographic area reveals that the highest concentration of sales will come from the North and South Americas, as it has been so far. The reason is simple – most of the startups that are working on the development of PaaS services are placed in that area.

The demand for cloud services will grow as globalization and standardization of processes set to increase. Nearly 65.2 percent of PaaS revenue was derived from the Americas and the figure is expected to decrease to 62.3 percent by 2017. There will still be a considerable growth in the Asia-Pacific region, including Japan with a market share of 14.1 percent in 2012 and a projected 19 percent in 2017. EMEA accounted for 20.7 percent of PaaS revenue last year, but is expected to drop slightly, to 18.7 percent, by 2017.

Another recent report published by 451 Research expected rise in PaaS spending at a CAGR of 36% per year. The market is expected to exceed $20 billion by 2016. Other research firms including Gartner have much higher forecasts for cloud computing. According to Gartner, the global market for BI will reach over $17 billion by 2016.

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