Public Cloud - Europe

Europe

Revenue in the Public Cloud market is projected to reach US$181.40bn in 2024.
Software as a Service dominates the market with a projected market volume of US$82.24bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 17.90%, resulting in a market volume of US$413.20bn by 2029.
The average spend per employee in the Public Cloud market is projected to reach US$434.00 in 2024.
In global comparison, most revenue will be generated in the United States (US$388.50bn in 2024).

Key regions: United States, Germany, China, Japan, United Kingdom

Definition:

A public cloud is defined as the digital infrastructure and computing resources that are managed by a service provider. Examples of public cloud computing resources include virtual machines, storage, and services, all of which are available for purchase with flexible (e.g., pay as you go and subscription) business models. Such payment options make it possible for customers to access, scale, and utilize resources as needed. Public cloud solutions make it possible for users to save on IT costs, increase their efficiency, and take advantage of advanced technologies without having to invest in long-term IT solutions. Public cloud service providers own and maintain the physical infrastructure, hardware, and software. Users only need to pay for the computing resources that they require. The Public Cloud market refers to the companies that provide these cloud computing resources and services to individuals, businesses, and organizations.

Structure:

The Public Cloud market is structured into five markets based on the type of service models provided by the companies.

The Infrastructure as a Service (IaaS) market covers the resources and services related to the data center infrastructure.
The Platform as a Service (PaaS) market covers the resources and services related to the virtual environments used for software development.
The Software as a Service market (SaaS) market covers the resources and services related to software applications that can be accessed via a web browser.
The Business Process as a Service (BPaaS) market covers the resources and services related to the various business processes such as finance and accounting, human resources, customer service, and supply chain management, all delivered through the cloud.
The Desktop as a Service (DaaS) market covers the resources and services related to virtual desktop environments, which are accessible from any device with an internet connection.

Additional Information:

The public cloud market comprises revenue, revenue change, average spend per employee, and key player market shares as key performance indicators. Only revenues that are generated by primary vendors at the manufacturer price level either directly or through distribution channels (excluding value-added tax) are included, and revenues generated by resellers are excluded. Revenues are generated through both online and offline sales channels and include spending by consumers (B2C), enterprises (B2B) as well as governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed.

Key players of the public cloud market include companies such as Amazon (Amazon web services), Microsoft (Azure), Google (Cloud), and IBM (Cloud).

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Analyst Opinion

The Public Cloud Market in Europe is experiencing steady growth, driven by factors such as increasing adoption of digital technologies, rising awareness of the benefits of cloud services, and the convenience offered by online platforms. The market's average growth rate is influenced by factors such as the sub-markets of Infrastructure, Platform, Software, Business Process, and Desktop as a Service, as well as the overall demand for cloud services in the region.

Customer preferences: As the use of cloud technology continues to expand in Europe, consumers are increasingly drawn to digital solutions for managing their personal and professional lives. This trend is fueled by a desire for convenience and flexibility, as well as the need for remote work and collaboration. Additionally, the growing emphasis on data privacy and security is driving demand for secure and reliable public cloud services. This shift towards digital transformation is expected to continue, as consumers become more comfortable with technology and seek out more efficient and accessible solutions.

Trends in the market: In Europe, the Public Cloud Market is experiencing a surge in demand for hybrid cloud solutions, with organizations seeking a balance between on-premises and off-premises infrastructure. This trend is being driven by the need for more flexibility, scalability, and cost-effectiveness in managing data and applications. It also reflects a shift towards a multi-cloud approach, with companies utilizing multiple cloud providers for different workloads. This trajectory is significant as it highlights the growing importance of hybrid cloud in the region and its potential to drive innovation and competitiveness. Industry stakeholders, including cloud service providers, will need to adapt to this trend to stay relevant and capture market share. Additionally, there may be implications for data privacy and security regulations as companies navigate the complexities of managing data across multiple cloud environments.

Local special circumstances: In Europe, the Public Cloud Market is experiencing steady growth due to the increasing adoption of cloud-based services in various industries. However, each country has its own unique factors that shape the market. For example, in Germany, strict data privacy laws have led to the rise of local cloud providers, while in France, the government's digital transformation initiatives have accelerated the adoption of public cloud services. In the UK, the public sector's push for cost-effective solutions has driven the demand for public cloud services, while in Spain, the growing number of small and medium enterprises has created a market for affordable cloud solutions.

Underlying macroeconomic factors: The Public Cloud Market in Europe is heavily influenced by macroeconomic factors such as technological advancements, government policies, and investment in digital infrastructure. Countries with pro-business policies and strong investment in digital technologies are experiencing rapid growth in the market, while regions with regulatory challenges and limited funding are facing slower growth. Furthermore, the increasing adoption of cloud-based solutions by businesses of all sizes, coupled with the growing trend of remote work, is driving the demand for public cloud services in Europe. This trend is expected to continue as the region continues to recover from the economic impact of the COVID-19 pandemic.

Methodology

Data coverage:

The data encompasses B2B, B2G, and B2C enterprises. Figures are based on the money spent at manufacturer price level (excluding VAT).

Modeling approach / Market size:

Market sizes are determined through a top-down approach with a bottom-up validation, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of the market-leading companies and reports from our primary research. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP and level of telecommunications infrastructure. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. The main drivers are the GDP and the level of digitization.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level.