The worldwide public cloud services market is projected to grow 17% in 2016 to $208.6 billion, according to Gartner.
The highest growth will come from IaaS, which is projected to grow 43% in 2016. SaaS, one of the largest segments in the global cloud services market, is expected to grow 22% in 2016 to reach $38.9 billion.
"There's no question there is great appetite within organizations to use cloud services, but there are still challenges for organizations as they make the move to the cloud," said Sid Nag, research director at Gartner. "Even with the high rate of predicted growth, a large number of organizations still have no current plans to use cloud services.”
IT modernization is currently the top driver of public cloud adoption, followed by cost savings, innovation, agility and other benefits. The focus on IT modernization indicates a more sophisticated and strategic use of public cloud services.
Security and/or privacy concerns continue to be the top inhibitors to public cloud adoption, despite the strong security track record and increased transparency of leading cloud providers.
Most organizations are already using a combination of cloud services from different cloud providers. While public cloud usage will continue to increase, the use of private cloud and hosted private cloud services is also expected to increase at least through 2017.
The increased use of multiple public cloud providers, plus growth in various types of private cloud services, will create a multi-cloud environment in most enterprises and a need to coordinate cloud usage using hybrid scenarios.
Although hybrid cloud scenarios will dominate, there are many challenges that inhibit working hybrid cloud implementations. Organizations that are not planning to use hybrid cloud indicated a number of concerns, including integration challenges, application incompatibilities, a lack of management tools, a lack of common APIs and a lack of vendor support.