The past two years saw a proliferation of Cloud-native infrastructures in organizations across the globe. Enterprises are just beginning to tap the power of Cloud, compelling decision makers to increase the capital invested in this sector.
According to the International Data Corporation (IDC), there has been a 13% year on year increase in storage and compute infrastructure spending. It rose to $21.1 billion in the fourth quarter of 2021. This included both shared and dedicated environments.
In the post-pandemic world, many businesses faced a financial crunch, causing constraints in supply chain and depleted inventories. Now, however, supply is predicted to be able to catch-up to the increasing market demand, provided the economy stays in good shape.
Glancing over the full year 2021 shows us the total Cloud Infrastructure spending to be $73.9 billion, marking an 8.8% increase from the year 2020. Whereas, the 2021 non-cloud Infrastructure spending increased only by 4.2%, as compared to the year 2020.
Shared Cloud Infrastructure spending saw a 13.9% increase, making it $14.1 billion in the final quarter of 2021. IDC is of the opinion that in 2022, the spending done on Cloud Infrastructures is going to exceed that of Non-Cloud Infrastructures.
Dedicated Cloud Infrastructure spending in the 4th Quarter of 2021 rose to $6.7 Billion, a year-over-year 12.5% increase. A 13.1% growth is predicted for Dedicated Cloud Infrastructure, making it $25.4 billion in 2022.
The future of Cloud Infrastructure looks bright, as IDC anticipated that in the year 2022, its spending will increase by 21.7% to US $90 billion. Non-Cloud Infrastructure is predicted to see a decline of 0.3%.
IDC also keeps track of compute and storage, purchase of service providers (cloud, digital, communication and managed). This includes both Cloud and Non-Cloud Infrastructures. Service providers spent $21.2 billion on compute and storage infrastructure, in the fourth quarter of 2021, and a total of $75.1 billion in the entire year.
According to IDC, for the year 2022, there will be an expected 18% year over year (YoY) growth in storage and compute spending.
IDC has also classified the geographic regions based on their Cloud Infrastructure spending for Q4 of 2021. Spending from Asia Pacific, without including China and Japan, increased by 59.5%. Cloud infrastructure saw a double-digit growth in spending for the Middle East, China, Japan, Canada and Central Europe. Cloud infrastructure spending in USA was only 5.6%. The Asia Pacific region, excluding China and Japan, grew by 43.7% in the year 2021.
Over the years 2021-2026, Cloud Infrastructure compute and storage spending are predicted to have a Compound Annual Growth Rate (CAGR) of 12.6%. This is a long-term prediction made by IDC which states that, in 2026, Cloud Infrastructure spending will reach US $133.7 billion, which accounts for 68.6% of the total compute and storage infrastructure spending.
According to IDC, the Compound Annual Growth Rate will increase by 13.4% for Shared Cloud Infrastructures and 10.7% for Dedicated Cloud Infrastructures. In 2026, Non-Cloud Infrastructure CAGR will be 0.5% (US $61.2 billion spending)
The Worldwide Quarterly Enterprise Infrastructure Tracker: Buyer and Cloud Deployment, commissioned by IDC, was made with the intention of generating transparent marketplace trends. This involves the amount deployed for the compute and storage in cloud environments.
An apt classification is done by the Tracker, based on Shared and Dedicated Cloud environment’s revenue. Analyzing the historical data, a holistic five-year prediction is made.