Cloud Computing Adoption in India


Cloud computing is generally used to describe IT services which include IaaS (Infrastructure-as-a-Service), PaaS (Platform-as-a-Service), SaaS (Software-as-a-Service) availed over the Internet by organizations. The primary benefits offered by cloud computing are potential of scalability and pay-as-you-go pricing models. Organizations can achieve operational efficiencies through technology. Cloud computing usage is gaining momentum in India mainly because of service models and pricing plans, and proven best practices such as cloud security followed by cloud service providers and support from the Government. 

CIOs in India are planning to adopt cloud computing on top priority. In this short note, the current state of cloud computing adoption and service models and business applications as preferred by the organizations are discussed.

Historical Facts
As per Gartner Study (Nov 2020)1, spending on cloud computing in India is forecast to total $4.1 billion in 2021, an increase of 29.4% from 2020.  Indian businesses are willing to spend over 8% of their IT costs on public cloud services due to its business flexibility and low costs. In 2021, cloud system infrastructure services (IaaS) will experience the largest growth at 44.6%, although spending on the cloud application services (SaaS) segment which is forecast to be the largest segment in the public cloud services market in India.  Gartner predicts that growth in cloud computing adoption is constant at compound annual growth rate (CAGR) of 33.2% globally. Small and medium organizations are more willing and quick to adopt public clouds because it reduces their upfront costs associated with new hardware, software implementations and maintenance costs.
Cloud Computing Service Models and their adoption
The cloud services market has nearly tripled since 2016. The  India’s cloud services (PCS) market, including infrastructure-as-a-service (IaaS), platform-as-a-service (PaaS) solutions, and software-as-a-service (SaaS), touched $1.6 billion for the first half of 2020. According to the International Data Corporation (IDC) report [Dec 2020]2, the overall India’s cloud services market is likely to touch $7.4 billion by 2024 growing at a CAGR of 22.2% for 2020-24. Thus, the cloud is transforming Indian Organisations and some of the observations made by IDC include:-
Cloud Computing Adoption and Business Applications

Indian Organizations are at an early stage of cloud adoption as compared to their global counterparts. The COVID-19 pandemic accelerated their cloud adoption rate significantly as organizations moved critical business applications such as email, web hosting, customer relationship management (CRM), enterprise resource planning (ERP) and human resources (HR) to the cloud, ensuring employees can access them anytime and from anywhere in the world, as long as they have internet access. Software products built on new technologies like cloud computing, social media and value-added services have witnessed a tremendous growth.  


However there is a slow pace of cloud adoption in sectors like  finance and banking, advertising, health care, etc., and it can be attributed to certain barriers such as inadequate knowledge of cloud technologies, last mile connectivity issues and lack of customer awareness on benefits offered by cloud adoption in terms of ROI.  Organizations can succeed in their cloud adoption provided they have a well-thought-out transformation plan and execution excellence. There is a growing acceptance of cloud based solutions,  embracing merging technologies like Internet of things (IoT),  big data, mobile technologies (3G, 4G)  by the organizations and is fuelled by Indian government’s initiatives for a digital India. 


The above studies and data indicate that cloud adoption is fast catching up in India and transforming IT services to provide a new direction. NASSCOM’s Perspective 20203 report is highly optimistic about India’s progress in cloud computing, mobility, broadband and internet connectivity over the next two years and beyond. It can be concluded that, cloud computing offers an appropriate IT infrastructure for operating a variety of business applications across all types of organizations in India.  Organizations need to unlock and capture both the IT and the business value potential to make a compelling business case for cloud adoption.

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Discussion Question

Identify three areas in your organization wherein cloud computing can be adopted. What would be the most tangible result of the adoption (e.g. cost, speed, accuracy etc)? Why?


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