This post is part of G2's 2025 digital trends series. Read more about G2’s perspective on digital transformation trends in an introduction from Tim Sanders, VP, research insights, and additional coverage on trends identified by G2’s analysts.
AI will be the primary driver for the growth of cloud computing in 2025, driving about 35% of its growth in the next 2 years.
According to G2’s 2024 Buyer Behavior Report, 56% of buyers said their organization had purchased an AI solution within the last three months. Though not all AI is on the cloud, a large part of it flows through the cloud infrastructure. In fact, a study by Deloitte observed that 70% of the companies adopting AI will obtain AI capabilities through cloud infrastructure.
Cloud computing not only makes powerful AI capabilities easily accessible without much capital expenditure (CapEx) investment but also increases the efficiency, scalability, and performance of AI applications. This synergy of cloud computing and AI is driving AI adoption and innovation across industries, irrespective of the company size. Consequently, AI is also becoming the catalyst for the growth of cloud computing in the next decade.
This projection is based on the current market value of AI cloud, the investments flowing into the cloud infrastructure to gear it up for AI, and the adoption that we see across industries.
Cloud AI, a subset of cloud computing, specifically refers to using cloud computing infrastructure to develop, deploy, and manage artificial intelligence (AI) applications and services.
The cloud AI market was valued at $91.3 billion in 2023 and is expected to grow at 36% CAGR in the next eight years, according to a study by Market Research Future, while the cloud market, which was valued at $450.89 billion in 2023 is expected to grow at 18.53% over the same period. At this rate, cloud AI is expected to contribute 46% of the cloud market by 2029.
However, we expect the cloud AI market to grow even faster based on the increased investments and the revenues that are already being reported.
Microsoft and OpenAI are investing $100 billion in project Stargate, which is focused on building a next-generation cloud infrastructure optimized for AI.
In Q2 of 2024, cloud giants Google, AWS, and Microsoft invested over $48 billion towards strengthening the cloud infrastructure for AI, including data centers and network infrastructure. Google Cloud’s revenue jumped 29%YOY in Q2 of 2024, surpassing investor expectations, mainly led by AI solutions. “Artificial intelligence (AI) infrastructure and generative AI solutions for cloud customers have already generated billions in revenues and are being used by more than two million developers,” said Sundar Pichai, CEO of Google, in Alphabet’s earnings call.
Huge investments by vendors in AI-driven cloud infrastructure are showing tangible results as reflected in the reviews on G2.
Reviews increasingly show that the time taken to achieve return on investment (ROI) is decreasing steadily for cloud AI solutions. This is mainly due to the increased efficieny and ehanced scalability of cloud platforms that allow companies to deploy and manage their AI applications more efficiently.
As businesses see quicker returns on their investments, they are becoming more confident in adopting cloud AI solutions.
Reduced time to ROI, improvements in scalability, and cost-efficiency, along with ease of implementation, is encouraging wide-spread adoption of these solutions as observed in G2 reviews. For example, the adoption score of generative AI infrastructure category has doubled in last one year.
It is clear that in 2025, AI will shape the future of cloud computing. Cloud will enable businesses of all sizes to harness the power of AI without heavy investments in necessary infratsructure, driving larger adoption of cloud solutions optimized for AI. AI in turn will make cloud much more efficient, scalable, and optimized to handle larger workloads that come with AI-enabled use cases. The synergy between cloud and AI is set to shape the next frontier of technological innovation.
Check out cloud trends from 2024 to understand AI's influence on cloud scalability and efficiency!
Edited by Supanna Das
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