Hybrid cloud to be large part of cloud provider revenue, says research firm

Hybrid cloud services are going to make up a large portion of overall cloud as a service (CaaS) revenue by 2017 as more enterprise customers move to hybrid cloud architectures. A new IHS report said that innovation in the CaaS and platform as a service (PaaS) off-premises cloud service markets will continue to arise as new tools to automate data centers and new technologies such as containers for developers become more widespread.

As the market becomes more competitive, hyperscale infrastructure-as-a-service (IaaS) providers will use price cutting to differentiate themselves, a move IHS says is brought on by their efficiencies of scale and technology versus slimmer margins.

"CSPs should apply caution when using past years' cloud services revenue breakdowns to drive future investment," said Cliff Grossner, Ph.D, research director for data center, cloud and SDN at IHS. "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." Release

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