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Public cloud gathering momentum in India – Gartner

Few countries are speeding towards the digital economy as quickly as India, and it seems the bug is catching as enterprise organizations start to surge spending on the public cloud.

Today’s India is almost unrecognisable from bygone years. With a renewed focus on digital from Government and regulatory agencies, telcos finally spending on networks and consumers demonstrating an incredible appetite for data, India is quickly closing the divide. An increase in public cloud spending only adds further confidence in progress.

“Moving to the cloud and investing in public cloud services have become imperative to the success of digital business initiatives,” said Gartner Analyst Sid Nag.

“It’s no longer a question of ‘why’, but a matter of ‘when’ organizations can shift to the cloud. We have entered the cloud 2.0 era, where organizations are adopting a cloud-first or a cloud-only strategy.”

Those who are of a certain age will remember the excitement which was drummed up around the ‘BRIC’ nations. The acronym described the economic potential of slumbering giants (Brazil, Russia, India and China), four countries with large population that were supposed to be the growth engines for international businesses around the world after growth in domestic markets slowed.

China certainly offered fortunes for those who were strategically savvy enough, while there has been some promise in Russia and Brazil. India was always the nation which undermined the BRICs theory, though it is quickly entering its own digital era.

According to Gartner estimates, public cloud investment from enterprise organisation will increase by 25% over the next 12 months. Software-as-a-Service (SaaS) remains the largest segment, representing 42% of all investments, though this is the same journey many ‘developed’ nations took in bygone years. The team estimates SaaS cloud application services will total $1.4 billion over the next 12 months, an increase of 21%.

Segment 2018 2019 2020
Platform-as-a-Service (PaaS) 284 363 461
Software-as-a-Service (SaaS) 900 1,105 1,364
Business-Process-as-a-Service (BPaaS) 172 189 212
Cloud management and security 187 228 274
Infrastructure-as-a-Service (IaaS) 558 744 996

Figures in millions (US$)

As you can see from the figures above, spending has been steadily increasing year-on-year, though considering the size of India as a country, the potential is significant. However, there might be a challenge on the horizon unless all the cogs click into place.

CIOs across the market are suggesting there could be consolidation in the market as smaller players are replaced by the global power houses of the cloud economy, however with such potential money will have to be spent to ensure the digital infrastructure is in place.

This is where India has traditionally struggled. It was a ‘chicken and egg’ situation, with low ROI discouraging infrastructure investment, though inadequate infrastructure seemed to hobble potential profits. This conundrum does seem to be in the past, though there is still plenty of work to do to increase the data centre footprint, as well as ‘fibering up’ the nation to take advantage of future applications, both consumer and enterprise.

Amazon Web Services announced in May it would open a new Availability Zone in the AWS Asia Pacific (Mumbai) region due to customer demand, Microsoft Azure currently has three Availability Zones in the country and has partnered with Reliance Jio to boost its presence, Google is currently hiring very aggressively in the country, while IBM recently said it was focusing more acutely on SMEs to gain traction.

India still does not compete with the top nations around the world when it comes to digital readiness, but all the pieces do seem to be falling into place. Increased investments in public cloud services and infrastructure is more evidence this country is flying towards the digital economy.

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