Dive Brief:
- IT spending is steadily shifting from traditional IT offerings to cloud services, according to a new report from Gartner. The end result means $1 trillion in IT spending will be directly or indirectly affected by the shift to cloud during the next five years.
- The aggregate amount of "cloud shift" in 2016 is estimated to reach $111 billion, increasing to $216 billion in 2020.
- In addition to the direct effects of cloud shift, many markets will be affected indirectly, Gartner predicts.
Dive Insight:
Gartner determined cloud shift rates by comparing IT spending on cloud services to traditional IT services in the same market categories.
"Cloud-first strategies are the foundation for staying relevant in a fast-paced world," said Ed Anderson, research vice president at Gartner in an announcement. "The market for cloud services has grown to such an extent that it is now a notable percentage of total IT spending, helping to create a new generation of start-ups and 'born in the cloud' providers."
Gartner says this shift means cloud computing is one of the most disruptive forces of IT spending ever.
The research organization also said cloud shift is not just about cloud, but also can impact other markets. For example, enterprise storage needs could be met with a lower up front cost and far more scalability by switching to cloud solutions instead of buying dedicated hardware, Gartner said.
"Furthermore, organizations embracing dynamic, cloud-based operating models position themselves better for cost optimization and increased competitiveness," said Anderson.
