IDC Forecasts $24 Billion Annual Spend on Hosted Private Cloud Services by 2016


A February 28, 2013 article in bizcloud by razavi entitled Hosted Private Cloud Services to Surpass $24 Billion in 2016 reports on International Data Corporation’s (“IDC”) optimistic outlook for Hosted Private Cloud (“HPC”) services in the near future. IDC predicts a compounded annual growth of more than 50% for the next 5 years. IDC predicts that the coming growth of HPC will transform how IT providers for outsourcing and hosting will provide their services.

The two types of deployment models for Cloud Services are:

1.       Public Cloud:  Opened to an unrestricted number of users who share services, and

2.       Private Cloud: Where a single Enterprise has defined users restrictions on access and level of allocated resources.

HPC is a hybrid of the private cloud services model and this hybrid can be further broken down into 2 models:

1.       Dedicated Private Cloud - Focus is on the needs of one enterprise with significant customer control over the contracted resources.

2.       Virtual Private Could – Contains shared virtualized resources with a wider range of customer controls and security options.

Robert Mahowald, Research Vice President at IDC and leads the SaaS and Cloud Services practice stated, “IDC anticipates that virtual private cloud will be the predominant operational model for companies wanting to take advantage of the speed and lower capital costs associated with cloud computing …”

As current IT buyers with an aging infrastructure look to the cost savings available from the Cloud, they will recognize the need to centralize their management of their cloud capabilities. These buyers are more likely to be Virtual Private Cloud customers. Enterprises with existing outsourcing and hosted environments will be looking for relief in the asset management and operational reliability area. These enterprises will probably be the Dedicated Private Cloud purchasers. Large incumbent packaged software providers and equipment providers, global systems integrators, professional services firms, and telecommunications service providers will be the beneficiaries as the Dedicated Private Cloud grows. Conversely, a new crop of vendors will benefit if the Virtual Private Cloud becomes the dominant model as IDC predicts.

Robert Mahowald stated:

“Not even the largest technology incumbents can sustain IT market leadership without achieving leadership in cloud services. Quite simply, vendor failure in cloud services will mean stagnation. Vendors need to be doing everything they can – today – to develop a full range of competitive cloud offerings and operating models optimized around those offerings.”


Trackbacks (0) Links to blogs that reference this article Trackback URL
Comments (0) Read through and enter the discussion with the form at the end
Post A Comment / Question Use this form to add a comment to this entry.

Remember personal info?