End-user spending on public cloud services in the Middle East and North Africa (Mena) region is projected to increase by 19.8% to reach $7.3 billion in 2024, up from $6.1 billion in 2023. It is further expected to grow by 24.4% to reach $9.09 billion next year, as per Gartner's research.
The surge in public cloud spending is anticipated due to the digitalization initiatives of companies in the Mena region. Moreover, Middle Eastern countries are aligning their economic objectives towards technology and data-centric approaches. Organizations are leveraging cloud technology as a facilitator for advanced technologies such as AI and business analytics to enhance their capabilities, quoted Shailendra Upadhyay, Senior Principal Analyst at Gartner.
Globally, end-user spending on public cloud services is estimated to surge by 20.4% to a total of $675.4 billion in 2024, up from $561 billion in 2023, according to Gartner's latest forecast. This growth is being propelled by generative AI (GenAI) and application modernization.
The anticipated growth in public cloud spending can be largely attributed to GenAI, driven by the continuous development of general-purpose foundation models and the scaling up of GenAI-enabled applications, as stated by Sid Nag, Vice President Analyst at Gartner. It is expected that public cloud end-user spending will surpass the one trillion dollar mark by the end of this decade due to this sustained growth.
All segments of the cloud market are anticipated to witness growth in 2024. Infrastructure-as-a-service (IaaS) is forecasted to experience the highest end-user spending growth at 25.6%, followed by platform-as-a-service (PaaS) at 20.6%. According to Nag, IaaS is continuing to grow robustly, reflective of the ongoing GenAI revolution. The demand for infrastructure for AI model training, inferencing, and fine-tuning is growing exponentially and directly impacting IaaS consumption.
Despite cloud infrastructure and platform services driving the highest spending growth, Software-as-a-Service (SaaS) remains the largest segment of the cloud market in end-user spending. SaaS spending is expected to grow by 20% to reach a total of $247.2 billion in 2024. Nag highlighted that the spend on SaaS is being fueled by the modernization of applications by independent software vendors to operate in a SaaS-based consumption model. Organizations are increasingly utilizing the cloud for specific use cases such as AI, machine learning, Internet of Things, and big data, which is propelling the growth of SaaS.
