PaaS spending: Small, growing and massively important

Platform-as-a-service is one of the least mature areas of the cloud market, but it's a hugely important one – and one that's attracting the attention of the largest IT companies.
Written by Jo Best, Contributor

The platform-as-a-service (PaaS) market may be small, don't be fooled — its size, and the attention IT's biggest players pay to it, is set to grow in the coming years.

The value of the worldwide PaaS market will hit $1.5bn next year, according to new research from analysts Gartner, and is predicted to almost double to to $2.9bn in 2016.

While Paas will remain a small ticket item for most IT buyers, at least in the short term, its significance shouldn't be underestimated, Gartner said on Sunday.

"All software mega-vendors are strategically investing in the PaaS market despite the relatively modest projected market revenue. Application infrastructure, and in this case application-infrastructure-as-a-service, has always played a central role in establishing the standards, architectures and best practices in enterprise software markets," Yefim Natis, distinguished analyst at Gartner, said in a statement.

"The vendors expect their leadership in the PaaS market to translate to large and effective ecosystems of partners, developers and solutions. PaaS technologies are embedded in many other types of cloud services — all major opportunity channels. The direct revenue in the PaaS market grossly underestimates the importance of this part of the cloud architecture."

Gartner's PaaS estimates cover suites of infrastructure services, including specialist offerings such as database platforms, as well as other functional types of middleware delivered via the cloud.

Cloud application platform services is currently the biggest area of PaaS, according to Gartner, accounting for 34.4 per cent of spending this year. It is followed by cloud application lifecycle management services at 12 per cent; cloud BPM platform services at 11.6 per cent; and cloud integration services (iPaaS) at 11.4 per cent.

PaaS spending — expected to reach $1.2bn this year — is largely concentrated in the US, which accounts for 42 per cent of the market today. Western European countries and areas of Asia-Pacific are also among the larger adopters of PaaS.

"Of all the cloud technological aspects, infrastructure as a service (IaaS) and software as a service (SaaS) are the most mature and established from a competitive landscape perspective, while PaaS is the least evolved," Fabrizio Biscotti, research director at Gartner, said.

"For this reason, PaaS is where the battle between vendors and products is set to intensify the most. It comes as no surprise that the PaaS competitive landscape is still in flux, with traditional application infrastructure vendors facing competition from new large players moving into the market, and myriad specialised PaaS pure players cutting into their slice of profits," he added.

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