www.GeoActiveGroup.com

European Cloud Growth Enables Remote Work

Cloud computing gained additional momentum during 2021. More organizations modernized their IT applications and invested in new digital transformation projects. Multi-cloud strategies are now pervasive across global markets as CIOs and CTOs spread their apps across the cloud hyperscalers.

The European public cloud market continues to grow at double digits, with European organizations investing in public cloud solutions to support their innovation strategies and digital business objectives, according to the latest market study by International Data Corporation (IDC).

European Cloud Service Market Development

“Over the past five years, the public cloud market has significantly changed the IT industry and grown like no other segment of the European IT market. The COVID-19 pandemic has accelerated the adoption of cloud services in Europe as cloud computing is seen as a crucial enabler of business resilience, agility, innovation, and efficiency,” said Filippo Vanara, research analyst at IDC.

But cloud not only benefits users and cloud service providers. There is a whole ecosystem around cloud users and cloud computing providers that also gains from the growth in the cloud services market.

When assessing the effect of public cloud solutions on a country’s or region’s economy, the broader ecosystem must be considered — mostly outside the organizations implementing the solution — to assess the impact from a macroeconomic perspective.

IDC’s most current report provides an overview of the impact the public cloud services market has on the European economy in terms of contribution to both Gross Domestic Product (GDP) and related employment.

According to IDC estimates, the public cloud computing supply chain contributed almost $500 billion to European GDP — that’s 2.7 percent of total European GDP.

IDC says this has significantly increased over the past two years, with a spike in 2020, due to the digitization journey that many organizations undertook during the COVID-19 pandemic.

Providing public cloud services requires a significant number of employees along the whole supply chain. IDC estimates that this supply chain accounts for roughly 1.3 million employees — or about 0.9 percent of the total European workforce.

This trend is even more interesting when compared with the percentage of total GDP generated along the supply chain, giving a rough estimate of the high productivity within the cloud computing sector.

Outlook for Cloud Applications Growth in Europe

IDC analysts believe that understanding the impact of the cloud services market on value creation and employment in the European economy is important for cloud providers and policymakers alike, as they formulate their forward-looking strategies for the European market.

“We expect public cloud providers to start considering new evaluation frameworks, identifying new metrics to increase clients’ awareness of the role of new solutions adopted, which goes beyond the mere improvement of business processes,” said Luca Butiniello, research analyst at IDC Europe.

That said, I anticipate Software-as-a-Service (SaaS) will continue to dominate the adoption of cloud-based applications in 2022 and beyond. In particular, the growth of Digital Workspace solutions will be fueled by the demand for IT organizations to support remote working requirements.

Online employee experience improvements from digital business workflow automation will drive more SaaS subscriptions of Desktop-as-a-Service (DaaS) apps that enable HR and IT teams to enable remote employee onboarding. Moreover, employee engagement reporting from related data analytics will also fuel SaaS consumption.

Originally published at https://blog.geoactivegroup.com on January 3, 2022.

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GeoActive Group | David H. Deans

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David H. Deans

David H. Deans

Technology, Media, Telecom analyst, consultant, columnist

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