Worldwide end-user spending on public cloud services is forecast to grow 20.4% to total $678.8 billion in 2024, up from $563.6 billion in 2023, according to the latest forecast from Gartner.

“Cloud has become essentially indispensable,” said Sid Nag, Vice President Analyst at Gartner in  a statement.

 “However, that doesn’t mean cloud innovation can stop or even slow. The tables are turning for cloud providers as cloud models no longer drive business outcomes, but rather, business outcomes shape cloud models,” added Nag.

Gartner explained that “all segments of the cloud market are expected see growth in 2024.” THe Infrastructure-as-a-service (IaaS) is forecast by Gartner to experience the highest end-user spending growth in 2024 at 26.6%, followed by platform-as-a-service (PaaS) at 21.5%.

“For example, organisations deploying generative AI (GenAI) services will look to the public cloud, given the scale of the infrastructure required,” explained Nag.

“However, to deploy GenAI effectively, these organisations will require cloud providers to address nontechnical issues related to cost, economics, sovereignty, privacy and sustainability. Hyperscalers that support these needs will be able to capture a brand-new revenue opportunity as GenAI adoption grows.” 

Gartner said that there is a continuous rise of industry cloud platforms. Hence, the industry cloud platforms address industry-relevant business outcomes by combining underlying software-as-a-service (SaaS), PaaS and IaaS services into a whole-product offering with composable capabilities.

“GenAI adoption will also support the growth in industry cloud platforms,” said Nag. 

“GenAI models that are applicable across diverse industry verticals might require significant customization, affecting scalability and cost-effectiveness. Public cloud providers can position themselves as partners in the responsible and tailored adoption of GenAI by building on the same approaches applied to industry clouds, sovereign clouds and distributed clouds.”

Gartner said in the statement it predicts that by 2027, more than 70% of enterprises will use industry cloud platforms to accelerate their business initiatives, up from less than 15% in 2023.