Global public cloud spending to hit $805B in 2024 with AI driving growth

As per IDC, the financial sector is leading the charge in cloud adoption, with the three largest industries — banking, software and information services, and retail — projected to collectively spend $190 billion on public cloud services in 2024.

Other significant contributors include telecommunications, media and entertainment, capital markets, healthcare providers, and professional and personal services — each accounting for more than 5% of worldwide spending.

Capital markets, life sciences, and insurance are expected to see the fastest growth in cloud spending through 2028, each boasting a CAGR of around 23%. Every industry, except consumer, is anticipated to achieve double-digit growth over the forecast period, the research firm said in the report.

Riding high on AI

AI, in particular, is emerging as a key driver of cloud growth. As organizations invest heavily in building and deploying AI platforms, the demand for cloud infrastructure is soaring. IDC predicts AI platforms will be the fastest-growing technology segment in the cloud market over the next five years.

“The rapid advancements in artificial intelligence are significantly driving the surge in cloud spending. With organizations increasingly building, testing, and deploying AI platforms, the growing interdependence between AI innovation and cloud infrastructure is positioning cloud services as the backbone of AI development and deployment,” Andrea Minonne, research manager of Data & Analytics at IDC, noted in the report.

Software as a Service (SaaS) remained the dominant cloud category, capturing more than 40% of total spending. However, Platform as a Service (PaaS) and Infrastructure as a Service (IaaS) are also experiencing significant growth, driven by the increasing complexity of cloud-native applications and the need for scalable infrastructure, the report added.