Cloud Computing services have become the fastest growing segment of the global outsourcing market, according to research house Gartner.
While global IT services spending will grow 2.1% year on year to hit $251 billion, Cloud services will nearly double from $3.4 billion in 2011 to $5 billion this year.
And of that already impressive number, it's Infrastructure-as-a-Service (IaaS) that's really set to shine, contributing 38 percent of outsourcing growth in 2012, compared to 8 percent in 2011. Over the same period, traditional data centre outsourcing, currently 34.5% of the market, will decline one percent.
Over the next four years, Gartner predicts data centre outsourcing will slip to 28% of the market while infrastructure utility services will grow to 10% percent market share and IaaS will expand to 6%.
"The data centre outsourcing market is at a major tipping point, where various data centre processing systems will gradually be replaced by new delivery models through 2016. These new services enable providers to address new categories of clients, extending DCO from traditional large organizations into small or midsize businesses," said Bryan Britz, research director at Gartner.
Applications outsourcing will grow around 2% to $40.7 billion this year largely due to the massive installed applications legacy base, but Gartner expects to see a shift towards increasing investment in SaaS that will erode the apps outsourcing numbers.
"Today, Cloud Computing services primarily provide automation of basic functions. As next-generation business applications come to market and existing applications are migrated to use automated operations and monitoring, increased value in terms of service consistency, agility and personnel reduction will be delivered," said Gregor Petri, research director at Gartner.
A separate survey -The State of IT Outsourcing - by consulting firm Bluewolf reflects many of these findings. The study polled over 200 IT decision-makers from companies at the SMB to Enterprise level as well as over 4,000 Cloud-based technology implementations.
The study notes: "An emerging delivery model for outsourcing may lie in the clouds. Cloud as a delivery model—which can be implemented in weeks, modified on the fly, and abandoned just as quickly—is gaining momentum. Businesses are leveraging the Cloud to outsource applications (Salesforce, Google Apps, Eloqua), data storage, and even the management of entire data centres to third-party providers."