Indian cloud computing, services market estimated at $1 billion by 2015: study

The $110-million market for cloud computing in India is expected to reach about $1.08 billion by 2015.

According to a study by Bangalore-based consulting services firm Zinnov, components of the cloud computing market like software-as-a-service (SaaS) would grow 10-fold to reach $650 million, platform-as-a-services (PaaS) and infrastructure-as-a-service (IaaS) by 2015, while platform-as-a-service (PaaS) along with infrastructure-as-a-service (IaaS) would touch $434 million by then.

The SaaS market, is currently estimated to be about $66 million and is currently dominated by collaborative applications, CRM, ERP and e-mail workloads.

The study said that several multinational and Indian companies were gearing up to provide cloud services to Indian customers.

''The next wave of transformation in the Indian IT industry, 'cloud computing' is indeed a perfect storm," says, Pari Natarajan, co-founder and CEO, Zinnov Management Consulting Pvt. Ltd, said. "The only difference is that, this storm is destructive only to companies who are not willing to change, while it is a huge opportunity for others.''

According to Natarajan cloud computing has allowed the smaller ISVs access to customers that they could have never had through the use of market places.

He adds, "This has allowed smaller ISVs to be based on cloud platforms (such as Azure, App Engine etc) and make themselves available to global customers, thereby, significantly reducing their cost of sales. On the other hand, this has also increased the flexibility for end customers and increased the choice of products and services.''

In addition to the global providers of PaaS, Indian companies have also sprung up offering cloud based PaaS. Several Indian companies are beginning to offer IaaS to leverage the untapped market potential, highlighted the report.

Discussing the growth verticals for the adoption of cloud in India, the report said that telecom, IT-BPO and retail have the highest spending on IT as a percentage of revenues.

While verticals like telecom and BFSI are highly mature with their IT adoption and show higher potential towards cloud adoption, verticals such as education, healthcare, and government show massive potential for cloud adoption in the immediate future as they aim to meet global standards.

Praveen Bhadada, engagement management at Zinnov Management Consulting Pvt. Ltd, said, "The growth in IT spending in India is one of the fastest in the world and is expected to be higher than China soon. India being the world's fastest growing mobile market with over 20 million subscribers added every month and the money that companies have invested for 3G services showcases the belief the large telecom providers have on data services in the Indian market.

Also, over 500 million people form the middle class in India, and the products and services consumed by them are relevant to other emerging markets as well. All this clearly suggests that Indian customers are ideal for cloud offerings. Indian SMBs in specific, lack budgets, want business improvement, lack management bandwidth required to manage internal IT and are looking for rapid growth in the next few years. For all of this put together, cloud computing is indeed the answer.''