The worldwide infrastructure as a service (IaaS) market grew to $140 billion in 2023, increasing 16.2% from $120 billion in 2022, according to Gartner, Inc. The top companies in the IaaS market in 2023 were Amazon, Microsoft, Google, Alibaba, and Huawei.
“Cloud technologies continue to be a major business disruptor, due in part to the focus on hyper scalers looking to support offerings related to sovereignty, ethics, privacy, and sustainability,” said Sid Nag, VP Analyst at Gartner. “This should continue to drive exponential growth into the future with these offerings being spurred by generative AI (GenAI) investments for 2024 and beyond.”
Nag added that as the top hyperscalers continue to grow their IaaS offerings, other areas, such as software-as-a-service (SaaS) and platform-as-a-service (PaaS), will also grow. “IaaS is the tide that lifts all boats,” said Nag.
GenAI
Gartner finds that generative AI is beginning to impact the growth of cloud markets, as the cloud is foundational to making GenAI a reality.
“The segments that are beginning to see the impacts of GenAI include IaaS, where AI model training is consuming IaaS resources, and SaaS, where GenAI capabilities are beginning to be included in SaaS applications,” said Nag.
“Capacity demand in public cloud markets has already increased sharply as a result and will continue to do so through 2028. In the near term, AI-driven revenue growth will be small relative to the overall public cloud market.”
