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Steven Worrall, Managing Director at Microsoft ANZ

Multi-billion dollar opportunity in ANZ’s public cloud

By 2026, the adoption of public cloud technology in Australia and New Zealand is expected to surge, creating billions of dollars in new revenue. 

This will involve customers using public cloud technology and suppliers providing the necessary hardware, software, and services for its delivery.

A new report from the International Data Corporation (IDC) commissioned by Microsoft suggests that the adoption of public cloud services has risen steadily since the pandemic began, with more organisations seeking to improve their capabilities and reduce costs. 

The report notes that public cloud services have been steadily increasing since the pandemic began, with organisations looking to enhance their capabilities and optimise costs. The trend is expected to accelerate, with the adoption of the public cloud as the go-to platform for digital transformation. 

The whitepaper reveals that public cloud spending in Australia is projected to rise by 83 per cent from A$12.2 billion in 2022 to A$22.4 billion in 2026. In New Zealand, public cloud spending is anticipated to double nearly from NZ$2.6 billion to NZ$5.1 billion over the same period. 

The report estimates that the adoption of public cloud services will generate A$123.7 billion in revenue for Australia’s cloud customer and supplier ecosystems in 2022, equivalent to more than 5 per cent of the GDP. Meanwhile, public cloud adoption in New Zealand is expected to generate NZ$23.9 billion in 2022, which is almost 6 per cent of GDP. 

Cumulatively, the report estimates that public cloud deployments will generate new revenue of more than A$114 billion in Australia and NZ$21 billion in New Zealand for cloud customer and supplier ecosystems by 2026. 

The whitepaper, titled Public Cloud Services Opportunities and Dividends to the Australian and New Zealand Economies, Doc #AP15023X, November 2022, offers a comprehensive insight into the promising future of public cloud adoption in the region.

Skills shortage looms

The report also predicts that public cloud adoption and related areas like security and data analytics will also create almost 600,000 jobs in Australia and 134,000 in New Zealand. However, more digital skills may be needed for organisations looking to take full advantage of the cloud’s potential.

The whitepaper also suggests that organisations with existing cloud migration strategies will continue to adopt public cloud services to drive business efficiency. On the other hand, businesses without cloud strategies in place will have to adapt reactively. The report recommends that organisations invest in upskilling their workforce to build necessary cloud knowledge and capabilities. 

Specialised cloud environment management requires technical and IT-related digital skills, and the availability of these skills has yet to be able to keep up with the demand, creating a significant hurdle for organisations on their cloud adoption journey.

“Cloud computing enables organisations to free up IT resources so they can achieve more technology and business innovation to drive revenue growth,” says Linus Lai, Research Vice President at IDC Asia/Pacific and co-author of the whitepaper.

“Investment in cloud computing services also drives revenue growth for organisations that make up the supplier ecosystem. These include systems integrators, software providers and professional services providers,” adds Lai.

Steven Worrall, Managing Director at Microsoft ANZ says: “It’s clear that the strong demand for public cloud services in Australia and New Zealand shows no signs of slowing, as organisations continue to transform their business operations, accelerate the pace of innovation and capitalise on technologies such as AI and data analytics,” says Steven Worrall, Managing Director at Microsoft ANZ.

“Cloud technology will also help organisations remain resilient in today’s challenging economic environment by enabling them to simplify their IT systems and processes, reduce costs and minimise risks.

“We’re also excited to be adding significant new Generative AI capabilities, including copilot productivity functionality across our Microsoft 365, Dynamics 365, Security, and Teams platforms and bringing Enterprise Azure OpenAI services to the cloud.

“These will enable customers and developers to unlock further productivity and innovation from their investments in Microsoft Cloud while also leveraging our commitment to responsibility and trust in this new area of technology.”

To learn more, read the whitepaper here.

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Yajush Gupta

Yajush Gupta

Yajush is a journalist at Dynamic Business. He previously worked with Reuters as a business correspondent and holds a postgrad degree in print journalism.

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