Cloud segments and vendors – additional information
Overall, vendor revenue from the global public cloud computing market is expected to reach 116 billion U.S. dollars in 2016, with the largest proportion of revenues coming from the Software as a Service (SaaS) segment. Through SaaS, vendors provide access to cloud-hosted software and databases. As with the other segments, Infrastructure (IaaS) and Platform (PaaS) as a Service, SaaS vendors often sell access via a subscription model, which has the benefit of reducing upfront costs for the customer while ensuring steady profits for the vendor over the lifetime of the contract.
The impact of the rising cloud market on traditional IT spending can already be seen in terms of falling spending on traditional IT infrastructure. According to one estimate, spending on traditional IT infrastructure is decreasing steadily and will begin to approach parity with public and private cloud IT infrastructure spending around 2020. Overall, service providers are forecast to spend some 60 billion U.S. dollars on cloud IT infrastructure, both private and public, in 2020.
Among cloud software vendors, the top end of the market is represented by corporations such as Salesforce, Microsoft, and Adobe. In 2016, Salesforce's revenues included 6.2 billion U.S. dollars from the sale of subscription and support services. As another example of cloud's increasing popularity, commercial cloud sales were said to represent 11 percent of Microsoft's commercial revenue in 2015, but this is predicted to increase to 30 percent of commercial revenue by 2018.