Europe Hybrid Cloud Market 2022-2028

Europe Hybrid Cloud Market 2022-2028

Market Overview

The European hybrid cloud market is growing at a significant CAGR of 20.8% during the forecast period. The market was valued at around $16.8 billion in 2021 and is anticipated to reach nearly $63.8 billion in 2028. The extensive demand for hybrid cloud is primarily driven by the growing need for scalability via the public or private cloud or both in traditional enterprises operating on the on-premise cloud. Hybrid cloud allows public clouds, private clouds, and on-premises IT infrastructure to interoperate seamlessly. Standardized between these technologies across business enables scalability, agility, and also improves responsiveness and constraining cost, despite growing complexity. Additionally, the hybrid cloud model increases security when successfully deployed. Hybrid cloud allows apps (to run) and data (to be processed and stored) in the IT infrastructure best aligned with specific security, regulatory, and governance requirements.

Furthermore, as hybrid cloud becomes widespread, adoption across companies and industries has been observed which is projected the market growth. In European regulated industries such as BFSI, healthcare, telecom, and retail and e-commerce, the cloud mix will lean more toward private cloud than public cloud. Whereas, in the less regulated industries, private cloud and public cloud both hold considerable potential. Hybrid cloud’s fundamental interoperability and portability mean organizations are not confined to either one infrastructure or one individual public cloud vendor. They can place their workloads in the best spot—and have the interoperability between infrastructure and between different public/private cloud providers.

Market segment

According to the National Institute of Standards and Technology (NIST), the essential characteristics of cloud include broad network access, rapid elasticity, measured service, on-demand self-service, and resource pooling. These characteristics operate across three major cloud service layers- software as a service (SaaS), platform as a service (PaaS), and infrastructure as a service (IaaS). SaaS held the highest market share of 63.0% in 2021 accounted for nearly $10.6 billion in 2021 and is projected to reach $38.3 billion in 2028. SaaS is cloud-hosted, ready-to-use application software. Users pay a monthly or annual fee to use a complete application from within a web browser, desktop client, or mobile app. SaaS cloud service is managed by cloud service providers, from maintaining the server hardware and software to managing user access and security, storing and managing data, implementing upgrades and patches, and more, due to which it is more popular among enterprises. Popular business or enterprise SaaS solutions include Salesforce (customer relationship management software), HubSpot (marketing software), Trello (workflow management), Slack (collaboration and messaging), and Canva (graphics). Many applications designed originally for the desktop (Adobe Creative Suite) are now available as SaaS (Adobe Creative Cloud).

Among vertical, BFSI dominated the market with 25.4% in 2021. The market value generated by the BFSI industry in 2021 was nearly $4.3 billion which is projected to reach nearly $16.1 billion in 2028, growing at a CAGR of 20.7% during the forecast period. The dominance of the BFSI segment is attributed to the increasing adoption of enterprise cloud solution to enable enhanced client experience, and advantages such as secure transactions and constant access to client databases. Moreover, the increasing digitalization in the banking industry to deliver enhanced customer experience further increases the demand for business software and services in the BFSI segment.

Based on component, hybrid cloud solutions dominated the market with 88.4% in 2021. The market value generated by the hybrid cloud solution in 2021 was nearly $14.9 billion which is projected to reach $57.4 billion in 2028, growing at a CAGR of 21.1% during the forecast period. Whereas cloud service (hybrid cloud add-on support service) held 11.6% in 2021 accounting for around $2.0 billion which is projected to reach nearly $6.4 billion in 2028, growing at a CAGR of 18.2% during the forecast period.
 
Regional Outlook

The European hybrid cloud market is analyzed based on major economies including UK, Germany, France, Spain, and Italy, among various others. Major factors contributing to the growth of the market in Europe include well-developed IT infrastructure and high adoption of hybrid cloud-based solutions among enterprises. UK held the highest market share of 25.3% accounted for $4.3 billion in 2021 and is anticipated to reach nearly $16.1 billion in 2028. The hybrid cloud market in Germany is growing at the highest CAGR of 22.1% during the forecast period. Major hybrid cloud companies such as AWS, Oracle Corp., Microsoft Corp., and IBM Corp. are the global market players which are also operational in the European region strengthening the market in this region. These players have adopted growth strategies such as product launch and geographical expansion to expand their footprint in the market.