Public Cloud - China

China

Revenue in the Public Cloud market is projected to reach US$60.03bn in 2024.
Infrastructure as a Service dominates the market with a projected market volume of US$32.85bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 20.75%, resulting in a market volume of US$154.10bn by 2029.
The average spend per employee in the Public Cloud market is projected to reach US$76.27 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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Market

Region

Region comparison

Currency

Analyst Opinion

The Public Cloud market in China has been experiencing significant growth in recent years.

Customer preferences: Chinese customers are increasingly turning to public cloud services due to the numerous benefits they offer. One of the main customer preferences driving the growth of the public cloud market is the scalability and flexibility it provides. With public cloud services, businesses can easily scale their resources up or down based on their needs, allowing them to adapt quickly to changing market conditions. Additionally, the pay-as-you-go pricing model of public cloud services is appealing to Chinese customers as it allows them to only pay for the resources they actually use, resulting in cost savings.

Trends in the market: One of the key trends in the public cloud market in China is the increasing adoption of cloud services by small and medium-sized enterprises (SMEs). SMEs in China are recognizing the benefits of public cloud services in terms of cost savings, scalability, and access to advanced technologies. As a result, they are increasingly leveraging public cloud services to enhance their business operations and compete with larger enterprises. Another trend in the market is the growing demand for hybrid cloud solutions. Many Chinese businesses are opting for a combination of public and private cloud services to meet their specific requirements. This hybrid approach allows them to take advantage of the scalability and cost-effectiveness of public cloud services while maintaining control over sensitive data through private cloud infrastructure.

Local special circumstances: China has unique regulatory requirements and data sovereignty concerns that have influenced the development of the public cloud market. The Chinese government has implemented strict regulations regarding data storage and security, which has led to the emergence of domestic cloud providers that comply with these regulations. This has created a highly competitive market with both domestic and international cloud providers vying for market share.

Underlying macroeconomic factors: The rapid growth of the public cloud market in China can be attributed to several underlying macroeconomic factors. Firstly, the country's strong economic growth has led to an increase in business activities and the need for advanced technology solutions. Public cloud services provide a cost-effective way for businesses to access cutting-edge technologies without heavy upfront investments. Additionally, the Chinese government has been actively promoting the adoption of cloud computing as part of its broader digital transformation initiatives. This has resulted in favorable policies and incentives for businesses to migrate to the cloud, further driving the growth of the public cloud market. In conclusion, the Public Cloud market in China is experiencing significant growth due to customer preferences for scalability and cost savings, the increasing adoption of cloud services by SMEs, and the demand for hybrid cloud solutions. Local special circumstances, such as regulatory requirements and data sovereignty concerns, have also influenced the market. Underlying macroeconomic factors, including strong economic growth and government initiatives, have further propelled the growth of the public cloud market in China.

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.