Market Insight

REPORT HIGHLIGHTS - Hybrid Cloud Will Become a Big Portion of Cloud Service Provider Revenue

February 05, 2016

Clifford Grossner Clifford Grossner Executive Director & Technology Fellow
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IHS Inc. (NYSE: IHS), the leading global source of critical information and insight, today released excerpts from its Cloud Service Strategies: Global Service Provider Survey, which examines all types of off-premises cloud services, including infrastructure-as-a-service (IaaS), cloud-as-a-service (CaaS), platform-as-a-service (PaaS) and software-as-a-service (SaaS).

“In our recent survey, cloud service providers (CSPs) said their top revenue-generating services are computing for IaaS, public cloud for CaaS, mobile app development for PaaS and email for SaaS,” said Cliff Grossner, Ph.D., research director for data center, cloud and SDN at IHS.  

“CSPs should apply caution when using past years’ cloud services revenue breakdowns to drive future investment. For CaaS hybrid cloud, 2014 revenues were only a small portion of CaaS revenue. But we expect hybrid cloud to become a significant portion of overall CaaS revenue, and similarly for enterprise resource planning (ERP), CRM, collaboration and security with SaaS,” Grossner said.


  • CaaS is the off-premises cloud service most survey respondents expect to offer by 2017, removing IaaS from the #1 spot; CSPs are following enterprises’ intent to move to hybrid cloud architectures and are investing accordingly
  • Expect lots of innovation in the CaaS and PaaS off-premises cloud service markets as new tools to automate data centers and new technologies such as containers for developers attain widespread use
  • Hyperscale IaaS providers continue to use significant price cutting as a competitive move, which they claim is enabled by their efficiencies of scale and technology rather than by slimmer margins


For its 33-page cloud strategies survey, IHS interviewed operators in North America, EMEA and Asia Pacific about their deployment of off-premises cloud services and plans for evolving their cloud services offerings over the next two years. The study provides insights into operators’ target market segments and verticals, go-to-market strategies, challenges, and cloud service offerings by type (IaaS, CaaS, PaaS, SaaS).


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