How much will the cloud market grow in the next five years?

Cloud Market Growth, Cloud, How much will the cloud market grow in the next five years?

MEA Cloud Computing Market worth US$31.4bn by 2026 according to a new exclusive report by MarketsandMarkets.

According to the new market research reportĀ MEA Cloud Computing MarketĀ by Type (Service Model (IaaS, PaaS, and SaaS) and Service Type), Deployment Model (Public and Private), Organisation Size, Vertical, and Region (the Middle East, and Africa) – Forecast to 2026″,Ā published by MarketsandMarketsā„¢, the MEA Cloud Computing Market size is expected to grow from USD 14.2 billion in 2021 to USD 31.4 billion by 2026, at a Compound Annual Growth Rate (CAGR) of 17.2% during the forecast period.

The Increased demand for cloud-based solutions and services during COVID 19, rising numbers of SMEs, business expansion by market leaders in the Middle East and Africa, and growing investments in cutting-edge technologies and governmental initiatives toward digital transformation are a few factors driving the growth of the cloud computing solutions and services in MEA.

Adopting IaaS is noticeably increasing in MEA among large enterprises due to security and reduced cost of hardware resources.

IaaS is a form of cloud computing that delivers fundamental compute, network, and storage resources to consumers’ on-demand, over the internet, and pay-as-you-go basis. IaaS refers to a combination of hosting, hardware, provisioning, and the basic services needed to run a cloud. Using the service, an organisation can outsource the equipment used to support operations, including storage, hardware, servers, and networking components. Most providers offer components, such as compute and storage, with support services, including auto-scaling and load balancing, which will provide the scale and performance characteristics. In traditional hosting services, IT infrastructure was rented out for a specific period of time, with pre-determined hardware configuration. The client paid for the configuration and time, regardless of the actual use. With the help of the IaaS cloud computing platform layer, organisations can dynamically scale the configuration to meet the changing requirements and are billed only for the services used. The IaaS cloud computing platform layer eliminates the need for every organisation to maintain the IT infrastructure.

The growing trend of expanding business operations while working within the existing infrastructure to drive the cloud migration services

Implementation services ensure configuration and change management is in place and operational before moving any resource to the cloud. In contrast, migration services help move enterprises’ applications and data from the on-premises infrastructure to the cloud system, which is a virtual pool of scalable compute, network, and storage resources. Implementation services enable clients to quickly accomplish business goals for utilising the cloud strategy by planning, accessing the current system, performing quality validation and verification, and offering support. These services ensure a successful and secure deployment on any infrastructure, such as private cloud, public cloud, or hybrid cloud. They also provide training sessions for executives, program managers, and technical teams to ensure they are updated with the latest trends and the new cloud infrastructure offerings. These training programs enable stakeholders to utilise these offerings to the fullest to achieve the set goals. According to industry experts, several enterprises across geographies plan to migrate their enterprise workloads to cloud to leverage different benefits including flexibility, reliability, availability, and security. It is expected by 2025 that 70% of enterprise workloads will be running on the cloud infrastructure. The primary reason for the high demand for cloud migration services are scalability, flexibility for fluctuating workloads, improved productivity, agility, enhanced application security, and reduced costs.

Increased awareness related to cloud benefits among small and medium-sized enterprises is driving its adoption

Organisations with employee strength of less than 1,000 are categorised under SMEs. Compared to the large enterprises’ segment, the SMEs segment faces challenges in terms of resources. They require enhanced infrastructures with less investment. They require a flexible payment model for better cost optimisation of their business processes. SMEs are rapidly adopting cloud applications in the Middle East due to their ease and flexibility, and the demand is expected to grow during the forecast period. SMEs do not want expensive disaster recovery or backup offerings, nor do they need advanced functionalities related to IaaS, PaaS, and managed services. They want access to visualised hardware and computing infrastructures and pay only according to the time and hardware. These benefits, such as seamless scalability, flexibility, pay-as-you-go payment model, reduced operational costs, and customised offerings, as per business requirements, are facilitating the adoption of cloud applications among SMEs. Some of the major vendors offering cloud applications to SMEs in the Middle East include Oracle, IBM, and Adobe Systems.

Corporates are choosing private cloud due to security concerns caused by the increasing number of cyberattacks

A private cloud is a computing model that offers a proprietary environment dedicated to a single business entity. As with other types of cloud computing environments, a private cloud provides extended, virtualised computing resources. This deployment model enables a company to have better control over its data and reduce risks, such as data loss and issues related to regulatory compliance. The private cloud is used in banking and financial institutions, large enterprises, and government organisations, where only authorised users can access the system. The acceptance of private cloud deployments for enterprises with compliance concerns is due to its security and control benefits. Service providers offering hosted private cloud address significant essentials of compliance with regulations, such as HIPAA and PCI. Some of popular private cloud providers in the market are VMware, DXC, Dell EMC, Oracle, IBM, and Microsoft.

Retailers shifting business operations online to continue businesses during lockdown imposed due to COVID-19 is boosting the cloud computing demand

The retail and eCommerce vertical in the Middle East is on the edge of IT-driven innovation, as local retail players are embracing online platforms to improve their omnichannel presence. Retailers are now adopting social networks and apps to engage with their customers in real-time. The cloud infrastructure meets all the business requirements, ranging from security to business applications; thus, it is gaining traction among retailers in the Middle East. Retail organisations deal with a large amount of data that is collected through various point of sale terminals and websites. The cloud infrastructure provides opportunities for retailers regardless of their size to accelerate innovation, liberating their focus on developing competitive advantages without the weight of back-end reconciliations and framework maintenance. The AWS data centre is to be opened in the Middle East, which is expected to accelerate the deployment of cloud applications in the region.

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Middle East to dominate the MEA Cloud Computing Market in 2020

Countries in the Middle East are investing in cloud computing projects and cloud applications to develop and build knowledge-based economies. Cloud computing features that benefit the Middle East countries include:

  • On-demand resource availability.
  • Scalability.
  • Multi-user access to cloud-based applications.
  • Self-service computation.
  • Cloud storage.
  • Utility subscription models.

This section of the report segments the cloud applications industry in the Middle East, based on countries such as Saudi Arabia, UAE, Qatar, and other countries (Oman, Kuwait, and Bahrain).

Organisations in Saudi Arabia and the UAE have adopted cloud-based applications at an initial stage; hence, they dominate the other countries in terms of development. Qatar has emerged with a high adoption rate in recent years and is expected to witness the highest growth rate. In today’s era of globalisation, it has become important for enterprises in Qatar to remain ahead of their competitors in the technological space. For such organisations, outsourcing services to a third-party managed service provider is a profitable option. Hence, enterprises in the Middle East have moved toward adopting cloud applications to reduce costs and save time.

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The MEA Cloud Computing Market is dominated by companies such as Microsoft (US), AWS (US), IBM (US), Google (US), Alibaba Cloud (China), Oracle (US), SAP (Germany), Salesforce (US), Etisalat (UAE), BIOS Middle East Group (UAE), eHosting DataFort (UAE), Injazat Data Systems (UAE), STC Cloud (Saudi Arabia), Insomea Computer Solutions (Tunisia), CloudBox Tech (SA), Ooredoo (Qatar), Gulf business Machines (UAE), Intertec Systems (UAE), Fujitsu (Japan), Huawei (China), Comprehensive Computing Innovations (Lebanon), Compro (Turkey), Teraco Data Environment (SA), Liquid Intelligence Technologies (SA), Zonke Tech (SA), Cloud4Rain (Egypt), Infosys (India), TCS(India), Malomatia (Qatar), Cicso (US), and Orixcom (UAE). These vendors have a large customer base and strong geographic footprint, and organised distribution channels, which helps them increase revenues.

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