How Feasible is it to Invest in Cloud Computing Industry?

By | July 28, 2021

 

There is no denial to the fact that the term “cloud computing” has definitely become the biggest buzzword of 21st century. It is actually a generic term that can mean different things for different people. In its simplest form, it can be explained as simple process of using data centers with a lot of processing power for accomplishing the toughest of computing tasks. But, this can also include different services that are offered through Internet.

How Feasible is it to Invest in Cloud Computing Industry?

Future of Cloud Markets

 

Let us see how big the cloud hosting industry is… When we factor IaaS, PaaS and SaaS, the worldwide cloud computing market can easily be expected to grow more than $120 billion by year 2015. SaaS is the biggest part of the whole of cloud computing industry, comprising more than 70% of revenues of the industry. The industry will continue growing as more number of consumers and businesses continue recognizing the advantages of shifting their computing requirements to the cloud. At the same time, companies looking to offer such services will be entering the cloud industry for meeting those requirements. Cloud computing is a big and rapidly growing industry, and offers great investment prospects that can fetch awesome ROI.

 

SaaS vs. IaaS

 

Most of the value within the industry of cloud computing is being created because of SaaS. Software is adding more value along with inherently being scalable. As and when companies shift to subscription models, it helps in creating incredible value for successful vendors of SaaS that can benefit from operating high-margin and leverage revenue.

 

It is not at all surprising that SaaS forms the major part of the revenues in the industry.

 

IaaS, on the other hand, is one of the most commoditized businesses, as the types of storage and hosting services offered are mostly identical among various providers. This forces the companies to mostly compete on cost. We can’t of course forget that the hardware components building the infrastructure are also much commoditized; this means that the falling costs of component will inevitably be also translated into the reduction of prices. As costs related to cloud services are variable in nature, it also offers a lot of flexibility to the customers whose needs continue to change every now and then. This becomes very valuable during the times of fluctuations in broader cycles of economy.

 

Today, companies and consumers are increasingly understanding and acknowledging the value in different aspects of cloud computing. As the entire industry continues to mature, it has addressed different concerns that are related stability, pricing and security. This will obviously lead to bigger adoption throughout the industry.

 

SaaS vs. PaaS

SaaS can easily translate into a lot of cost saving for firms at the enterprise level, since they don’t have to any longer deal with management, licensing and large-scale software deployment. PaaS on the other hand is comparatively more complex and is not as widely adopted. This shows a very important driving factor of growth, as more companies continue to implement PaaS within their very own private, public, and hybrid clouds.

 

When it comes to actually investing in companies operating in cloud markets, most of the big guns already have a fantastic reputation, but even the upcoming firms offer great potential to reap big results.

 

On the whole, one thing is quite clear that cloud is indeed the way forward, and it only makes sense to make the most of it, while you still can, because a day would soon come, when the cloud industry would get saturated.

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