Public Cloud Services (PCS) spending in Europe will reach $113 billion in 2022 and will double to $$239 billion by 2026, growing at a 22% 5-year 2021-2026 CAGR.
Investments in Software-as-a-Service (SaaS) will continue to lead most of the spending in Public Cloud in Europe in 2022, but Platform-as-a-Services (PaaS) will be the fastest-growing segment as PaaS delivers enables business agility by allowing companies to quickly test and implement applications they have developed.
Professional services, banking, and discrete manufacturing will be among the top spenders in Public Cloud Services, absorbing almost 60% of the overall Public Cloud Services spend in 2022. Human-centric industries are adjusting their work policies to normalize remote working. This means that more attention to remote employee access to information will drive spending in Cloud solutions. Implementing digital-first and cloud-based strategies will continue to be a focus and the European PCS spend (excluding Russia) will grow 26.4% this year, showing that cloud will be resilient despite the conflict between Russia and Ukraine. Similarly, Russian investments in cloud solutions are expected to grow (7.7% YoY) in 2022, but with many companies pulling out of the country, growth will be slower than the rest of Europe.
“European companies want to automate their processes as they are experiencing market challenges including supply chain disruption and skill shortages. More frequently companies will adopt Cloud to create a solid real-time data analysis foundation that support business agility and resilience,” said Andrea Minonne, senior research analyst at IDC UK.
Public cloud has allowed the organization to focus on its core competencies, while delegating the complexities of owning, operating, and maintaining the actual IT infrastructure to public cloud service providers. As a result, we’re seeing a flurry of innovation that is driven by the ability to put efforts into the development of new products and services without the constraint of organizations’ ability to deploy them.
Companies are more frequently using Cloud services to upgrade and take their operations to the next level to streamline processes and strengthen the value they deliver to customers. Public Cloud Service providers are extending cloud services to edge locations, and this is supporting investments in the technology. Many factors including the conflict in Ukraine, is supporting many sectors including government to migrate to Cloud solutions for security reasons and this is supporting the next wave of cloud adoption for industries that hadn’t yet adopted the technology.