The public cloud services market in Asia Pacific excluding Japan (ApeJ) will exceed $10 billion in 2017, according to IDC, driven by infrastructure-as-a-service (IaaS), which will surpass software-as-a-service (SaaS) for the first time this year.
According to the IDC Worldwide Semiannual Public Cloud Services Tracker, IaaS spending in APeJ will reach $4.8 billion in 2017, marking a 47.8 percent share in the region and a 35.8 percent growth from 2016.
SaaS spending in the region will grow 29 percent over the year to mark a 45.6 percent share; while public cloud services will register a 6.6 percent share in APeJ, growing 37.2 percent over 2016.
"Digital transformation is driving multi-cloud and hybrid environments for enterprises to create a more agile and cost-effective IT environment," said Liew Siew Choon, senior market analyst for IDC's APAC services research team.
"Even heavily regulated industries like banking and finance are using SaaS for non-core functionality, platform as a service (PaaS) for app development and testing, and IaaS for workload trial runs and testing for their new service offerings."
Drivers of IaaS growth include the increasing demand for more rapid processing infrastructure, as well as better data backup and disaster recovery, according to Liew.
Countries such as China are also focused on cloud infrastructure and leveraging internet service providers as a way of promoting public cloud services, the report added.
The top three public cloud service providers in the region for 2016 are Amazon Web Services, Microsoft, and Alibaba, with a combined 50 percent market share, according to IDC. Microsoft's IaaS revenue contribution surpassed SaaS by the end of last year, the firm added.
IDC previously predicted that spending on public cloud services and infrastructure will reach $266 billion in 2021, dominated by SaaS.
The US will also account for more than 60 percent of worldwide cloud revenues through 2021, with total spending of around $163 billion, IDC added.