Driven by generative AI, global public cloud spending will grow to $675.4 billion in 2024

According to Gartner’s recent forecast, driven by production artificial intelligence (GenAI) and application modernization, global users’ spending on public cloud services will increase by US$6.754 billion this year. This figure represents an increase of 20.4% compared with last year's US$5.61 billion.

With global public cloud spending expected to reach $825 billion by 2025 (see Figure 1), this ongoing growth trend shows no signs of abating. This number marks a new milestone in the field of public cloud services. Public cloud services are becoming increasingly popular among enterprises for many reasons. First, it provides elasticity and flexibility, allowing enterprises to scale up or down their computing and storage resources based on actual needs. Secondly, public cloud services can provide higher reliability and security

Figure 1 Gartner’s public cloud service spending by global end users from 2023 to 2025 Forecast (USD million)

Sid Nag, vice president and senior analyst at Gartner, noted, “As the global public cloud services market continues to grow, we expect global end-user spending to exceed $12,000 by the end of 2030. billion mark.”

We expect continued growth in global public cloud spending to be driven in large part by the widespread adoption of GenAI, driven byAIModels are being created as well as massive growth in GenAI-enabled applications.”

In the Infrastructure as a Service (IaaS) segment, global end users are expected to experience the highest growth this year and next. Spending increases. This trend is related to what Gartner calls the ongoing GenAI revolution. Gartner emphasized that due to the growing demand for AI model training, inference and fine-tuning, the demand for infrastructure is also growing and will directly affect the consumption of IaaS.

Recently, the growth in spending on cloud computing infrastructure services has also become a hot topic of concern to research firm Canalys.

According to data released by Canalys last week, in the first quarter of this year, global spending on cloud computing infrastructure services (i.e., IaaS and PaaS) increased by 21% year-on-year to US$79.8 billion.

Figure 2 Growth rate of the world’s three major cloud computing providers from the first quarter of 2020 to the first quarter of 2024

The world's three major cloud service providers (AWS, Microsoft Azure and Google Cloud) exceeded the growth rate of the overall market with an overall growth rate of 24%. Their market share accounts for two-thirds of the global public cloud market, but these companies There is a significant difference in the growth rate. Microsoft achieved 31% year-over-year growth in the first quarter of this year, while AWS only grew 17%.

Considering AWS’s higher market share, its growth rate may be somewhat lower than that of its competitors, but Canalys noted that “the rapid growth of competitors’ businesses indicates that the global public cloud market is becoming increasingly competitive. It is worth It should be noted that AWS CEO Adam Selipsky announced his departure last week, a move that indicates that the company is looking for new impetus to deal with the erosion of market share."

However, according to Canalys data, AWS still ranks first. Top of the global cloud services market, with a 31% share of the global cloud services market, its growth rate is expected to bring its annual revenue to the US$100 billion milestone.

Like Gartner, Canalys is also paying close attention to the impact of AI on cloud service revenue.

Canalys said that with the huge potential brought by AI technology, many companies are adjusting their strategies and shifting from optimizing cloud budgets to actively investing. In addition, Amazon, Microsoft and Google are all experiencing a significant increase in commitment to long-term cooperation from enterprise customers, which undoubtedly shows that they are preparing for the long-term growth of cloud service usage.

Canalys analyst Yi Zhang pointed out: "There are significant differences in business strategies among the world's three major cloud giants, which is reflected in their different growth rates. It turns out that Microsoft's end-to-end product portfolio is It has built a strong moat to deal with competition; Google's strong strength in the field of AI has given it a strong impetus, and AWS recently invested $4 billion in Anthropic to promote the development of GenAI technology and integrate it into In its cloud services, this highlights AWS’s determination to maintain its market leadership as its business focus shifts to AI.”