Australian cloud market to hit $4.55bn by 2018

The Australian cloud services market reached $1.23 billion last year and is on pace to grow to $4.55 billion by 2018, Frost & Sullivan estimates.

Australian companies may be a bit more sceptical than their global peers about the benefits of big data, but growing use of data-intensive applications is the key driver behind the swelling demand for cloud services, the research firm said.

The market is expected to grow at a five-year CAGR of 30% from 2013 to 2018. Demand for infrastructure-as-a-service (IaaS) and platform-as-a-service (PaaS) will grow at a faster rate than software-as-a-service (SaaS), but SaaS still dominates spending.

“Two thirds of [Australian] companies that have adopted cloud services believe it has significantly improved their overall business performance,” Frost & Sullivan Senior Research Manager Phil Harpur commented.

“A significant proportion of organisations feel it has enhanced their ability to innovate and explore new business models. The education, mining and, in particular, government and financial services [sectors] have been strong adopters of cloud over the last six to 12 months.”

But concerns over security and autonomy are still preventing many companies from moving to the cloud, the research firm said. Around 38% of cloud adopters are more concerned about IT security since starting to use the technology.

A number of cloud applications have not fully addressed risks in data recovery and backup, and companies are concerned about a lack of internal skills required to manage cloud services.

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