Private Cloud Services Market

A private cloud is one of the cloud computing architectures that provides superior control and security to its end users along with the key benefits of cloud such as scalability, longer uptime, pay-as-you-go model, and higher efficiency. The customer entirely maintains a private cloud and bears the associated cost of acquisition, deployment, and maintenance. Private cloud is mostly adopted by businesses that have high requirement of security, business governance, and compliance with regulatory standards. The other cloud computing architectures are public cloud and hybrid cloud. In a public cloud computing architecture, all the computing resources are owned and maintained by the vendor, enabling significant reduction in IT costs for the customer without impacting the customer’s IT capabilities. A hybrid cloud is a combination of both private and public cloud architectures, which gives the advantage of cloud bursting to the customers. This model is also referred to as an expansion of private cloud where during peak demands, large volumes of insensitive data and less important applications are migrated to the public cloud while critical and sensitive data are stored and processed in the private cloud. It extensively makes use of automation and orchestration tools to enable synchronization between private and public clouds.

Among the three cloud computing models, hybrid cloud is gaining pace compared to the public or private cloud due to its flexibility associated with the management of security, cost, and customer demand. Public cloud has the largest size among the three cloud models as many organizations prefer this model due to its low cost. The market size for private cloud is almost one-third of the that of public cloud and it is growing at a slower rate than public cloud year over year. Continuous evolution of IoT and smart technologies and development of smart cities across the globe are expected to offer great opportunities of growth to the private cloud services market. However, the introduction of General Data Protection Regulation (GDPR) may hinder the growth of the private cloud services market as it has made public cloud more secure and has led to end-users to trust public cloud services. This may encourage the enterprises to transit from private cloud to public cloud environment.

In this study, the private cloud services market is segmented on the basis of service, organization size, end-user, and region. The services considered in this study are Software-as-a-Service (SaaS), Platform-as-a-Service (PaaS), and Infrastructure-as-a-Service (IaaS). Based on organization size, the market is segmented into small- and medium-sized enterprises (SMEs) and large enterprises. The major end-users of private cloud services covered in the study are banking, financial services, and insurance (BFSI), healthcare, retail, government, manufacturing, telecommunications and IT, media and entertainment, and others. Finally, the regions covered in this study are North America, Europe, Asia-Pacific, the Middle-East and Africa (MEA), and Latin America. North America is further segmented into the US and Canada; Europe into Germany, the UK, France, Spain, and the rest of Europe; and Asia-Pacific into China, Japan, India, Australia, and the rest of Asia-Pacific.

In the services segment, SaaS is the largest contributor whereas IaaS is expected to grow with the highest CAGR during the forecast period. Among the end-users, BFSI is the largest contributor whereas retail is expected to grow with the highest CAGR from 2018 to 2023. North American currently dominates the market and is expected to continue its position in terms of market share, whereas, Asia-Pacific is expected to be the fastest growing region during the forecast period.

The major vendors profiled in the study are Cisco Systems, Inc., Dell Inc., Hewlett Packard Enterprise Company, Oracle Corporation, IBM Corporation, Rackspace, US Inc., Red Hat, Inc., Salesforce.com, Inc., Amazon Web Services, Inc., and Microsoft Corporation. The strategy of partnerships, agreements, and collaboration is observed to be the most prominent strategy adopted by the major vendors from 2015 to 2018 to improve their position and excel in the private cloud services market.

Market Size

· 2014: USD 42.20 Billion

· 2018: USD 79.71 Billion

· 2023: USD 147.86 Billion

CAGR (2018-2023)

· 13.2%

Key Geographies [CAGR (2018-2023)]

· North America: 12.4%

· Europe: 12.0%

· Asia Pacific: 16.1%

· MEA: 14.6%

· Latin America: 14.1%

Key Market Drivers

· Increasing demand for low cost IT infrastructure

· Increasing demand for Artificial Intelligence, machine learning, and the Internet of Things

Key Market Opportunities

· Increasing concerns related to data security