Story image

Gartner: Why 28% of key enterprise IT spending will shift to cloud by 2022

Twenty-eight per cent of spending within key enterprise IT markets will shift to the cloud by 2022, up from 19% in 2018, according to Gartner. 

Growth in enterprise IT spending on cloud-based offerings will be faster than growth in traditional, non-cloud IT offerings. 

Despite this growth, traditional offerings will still constitute 72% of the addressable revenue for enterprise IT markets in 2022, according to Gartner forecasts.

“The shift of enterprise IT spending to new, cloud-based alternatives is relentless, although it’s occurring over the course of many years due to the nature of traditional enterprise IT,” said Michael Warrilow, research vice president at Gartner.

 “Cloud shift highlights the appeal of greater flexibility and agility, which is perceived as a benefit of on-demand capacity and pay-as-you-go pricing in cloud.”

More than $1.3 trillion in IT spending will be directly or indirectly affected by the shift to cloud by 2022, according to Gartner. 

Providers that are able to capture this growth will drive long-term success through the next decade.

Gartner recommends that technology providers use cloud shift as a measure of market opportunity. 

They should assess growth rates and addressable market size opportunities in each of the four cloud shift categories: system infrastructure, infrastructure software, application software and business process outsourcing.

The largest cloud shift prior to 2018 occurred in application software, particularly driven by customer relationship management (CRM), according to Gartner. 

CRM has already reached a tipping point where a higher proportion of spending occurs in cloud than in traditional software. This trend will continue and expand to cover additional application software segments, including office suites, content services and collaboration services, through to the end of 2022. 

Application software will retain the highest percentage of cloud shift during this period.

By 2022, almost one-half of the addressable revenue will be in system infrastructure and infrastructure software, according to Gartner. 

System infrastructure will be the market segment that will shift the fastest between now and 2022 as current assets reach renewal status. Moreover, it currently represents the market with the least amount of cloud shift. 

This is due to prior investments in data centre hardware, virtualisation and data centre operating system software and IT services, which are often considered costly and inflexible.

Microsoft urges organisations to tackle data blindspots
Despite significant focus placed on CX transformation, over a third of Australian organisations claimed that more than one in five of their projects failed.
Raising the stakes: McAfee’s predictions for cybersecurity
Security teams and solutions will have to contend with synergistic threats, increasingly backed by artificial intelligence to avoid detection.
Renesas develops 28nm MCU with virtualisation-assisted functions
The MCU features four 600 megahertz CPUs with a lock-step mechanism and a large 16 MB flash memory capacity.
DOCOMO ranked world's top mobile operator in 5G SEP applications
NTT DOCOMO has been ranked the world's leading mobile operator in terms of applications for candidate standard-essential patents.
Exclusive: Ping Identity on security risk mitigation
“Effective security controls are measured and defined by the direct mitigation of inherent and residual risk.”
CylancePROTECT now available on AWS Marketplace
Customers now have access to CylancePROTECT for AI-driven protection across all Windows, Mac, and Linux (including Amazon Linux) instances.
Gartner’s top 10 data and analytics trends for 2019
Data is the fuel for the modern world, and analytics the engine. Gartner has compiled the top 10 trends to watch this year.
How CIOs can work with colleagues to drive new competitive advantages
"If recent history has taught us anything, it’s that the role of the CIO is always changing, and that it won’t stop changing anytime soon."