Behind The Numbers: Synergy Research Breaks Down $110B Cloud Market

Cloud in 2015

Companies selling cloud services and infrastructure raked in a whopping $110 billion during the four fiscal quarters (Q4 2014 through Q3 2015) that ended last September, according to Synergy Research Group.

Those sales amount to highly respectable year-over-year industry growth of 28 percent.

But breaking the numbers down into six services and infrastructure segments, as Reno, Nev.-based Synergy has done, is even more revealing -- while more than half the cloud spending still goes toward purchasing hardware and software, service offerings are growing faster, rapidly closing the gap between segments.

"In many ways 2015 was the year when cloud became mainstream. Across a wide range of cloud applications and services we have seen that usage has now passed well beyond the early adopter phase and barriers to adoption continue to diminish," Synergy Research Group founder and Chief Analyst Jeremy Duke stated in the report.

"Cloud technologies are now generating massive revenues and high growth rates that will continue long into the future, making this an exciting time for IT vendors and service providers that focus on cloud."

Public IaaS/PaaS

Public cloud services were far and away the fastest growing segment of the overall cloud market.

Infrastructure-as-a-Service and Platform-as-a-Service operators in 2015 saw just a hair more than one-and-a-half times the revenue they took in the previous year -- 51 percent growth.

And it's no surprise that the overall IaaS/PaaS market was led by the two giants in the field: Amazon Web Services and Microsoft Azure.

Synergy told CRN that rounding out third and fourth place, respectively, were Salesforce -- with its popular development platforms -- and IBM, with its SoftLayer IaaS cloud and Blue Mix platform.

Private And Hybrid IaaS/PaaS

Private and hybrid cloud providers expanded their market almost as fast as their public peers in 2015, growing at a brisk 45 percent from the previous year.

That segment was led by IBM.

AWS claimed second place, perhaps surprising some.

Synergy's chief analyst, John Dinsdale, explained to CRN that with products like its Virtual Private Cloud -- dedicated single-tenant servers -- Amazon "can partition its infrastructure to offer some pure private cloud services to clients, and also pretty much all stops in between public and private."

Rackspace was third in this segment, and Hewlett Packard Enterprise, which is shuttering its Helion public cloud, was the fourth largest vendor of private and hybrid services.

It's worth noting that IBM, Rackspace and HPE all are part of the OpenStack ecosystem, and their private cloud offerings are anchored by the open-source cloud operating system.


Software-as-a-Service in 2015 was a $27 billion market dominated by Salesforce, with Microsoft -- offering an expansive portfolio crowned by Office 365 -- on the CRM giant's heels.

Following those leaders in third and fourth place, respectively, were Google, with its popular and pioneering Apps office productivity suite, and SAP, with a host of enterprise-management solutions.

The SaaS market saw a roughly 30 percent expansion in 2015 from the previous year.

Synergy excludes from this segment search, social networking, email and e-commerce solutions.


The Unified Communications-as-a-Service market showed healthy growth in 2015, with sales that climbed to the $4 billion mark.

Cisco and Citrix led the field, with Microsoft and RingCentral rounding out the top four.

UCaaS is a unique market that mostly stands apart from other cloud services and encapsulates a broad range of communications-related products. Driving radical change in how business communications are conducted, the segment grew at 16 percent year over year.

While standalone applications remained the larger component of the overall market, growth is coming faster from vendors selling complete business suites.

Those two categories are led by entirely different players. But Synergy predicts that ongoing feature and technology enhancements will ultimately blur the lines between standalone and integrated UCaaS products.

Public Cloud Infrastructure (Hardware and Software)

While the jaw-dropping growth came from operators selling services, more than half of revenues associated with cloud -- roughly $60 billion -- were collected in 2015 by hardware and software manufacturers selling their wares to companies building public and private clouds.

Leading the field of vendors selling infrastructure products to public cloud operators were Cisco and Hewlett Packard Enterprise.

Dell came in third, but will likely leapfrog its rivals next year, thanks to its acquisition of EMC. And rounding out the top four was IBM.

Overall, the business of selling infrastructure to public clouds grew by 30 percent in 2015.

Private Cloud Infrastructure (Hardware and Software)

Private cloud builders ramped up their purchases at half the pace of their public cloud cousins in 2015.

Nonetheless, sales of IT infrastructure to private cloud operators grew at a respectable clip of roughly 16 percent.

Hewlett Packard Enterprise and Cisco led the field, reversing their one-two positioning in the public cloud arena.

Microsoft posted third place, and Dell rounded out the top four -- a placing that will certainly change on next year's report when EMC sales are included on its balance sheet.