public cloud market landscape : india
TRANSCRIPT
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Sep, 2016
Public Cloud Market Landscape: India
Zinnov used multiple level of analysis backed by various sources of information to estimate market size
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Current India IT and Cloud Market
2020 Projections of India IT and Cloud Market
Zinnov used multiple sources of information and analysis to estimate India’s IT and cloud market
Primary Interactions
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• Interactions with industry experts across cloud applications, infrastructure services, and platform services
Secondary Sources
2
• Annual Reports• CXO Interviews• Analyst reports• Press releases by SIs, Tech
Vendors, Government Publications
Existing Database
3
• Digital SMB Report• IT Deal Database• Zinnov Reports • Zinnov Domestic IT Market
Zinnov Framework
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• Zinnov framework which includes various macro and industry specific factors responsible for IT and cloud market growth
India represents a lucrative market for Global Technology MNCs
3Source: IMF, Ministry of Statistics-India, Press Releases, Zinnov Analysis
The 21st century will be the Indian century and will have technology at its
heart
“We are looking at India as a partner across segments, not just for any one
area”
India is uniquely positioned. They’re tremendous in software development
compared to other countries
If you innovate in India for India, you are going to be able to innovate for the
world and India then can become the entrepreneurial engine for the world
-Satya Nadella, CEO Microsoft
-Virginia Rometty, CEO IBM
-Tim Cook, CEO Apple
-Sundar Pichai, CEO Google
Indian Macro Economic Factors Overview-2016India has emerged as a favorite technology investment
destination for Global Technology MNCs
371 Mn Internet Users
1Bn Telecom subscribers
$ 2.2 Trillion
40% Tech Influenced SMBs
GDP(Nominal)
Cloud spending in India would exceed $10 Bn by 2020
4
2015
2016
2020
34-35
35-36 (E)
66-67 (E)
16-17% (E)CAGR
~6%YoY
Growth Drivers
Data Centre Establishment
Start-up accelerators &
incubators
Investments in developer ecosystem
Market penetration through channel
partners
10-10.5(E)
3-3.5 (E)
2-2.5
~30-35(E)%CAGR
~42-46%YoY
3,900-4,000 (E)
1,100-1,200 (E)
740-760
~34-38(E)%CAGR
~58-62%YoY
Source: Zinnov Analysis
Year
(Public+Private)
At $2.6-2.8 Bn, SaaS will continue to be the biggest segment within public cloud followed by IaaS & PaaS cumulatively accounting for ~$1.2 Bn by 2020
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SaaS IaaS PaaS
2015
2016
2020
Cost-effective cloud workloads enabling enterprises and SMBs to optimize cost
Establishment of datacenters is enabling rapid adoption of IaaS
Investment in Developer ecosystem driving demand for PaaS solutions
($ Mn) ($ Mn) ($ Mn)
740-780
490-510
2,600-2,800
~55-60%
~36-40%
230-270
150-170
660-700
~51-55%
~28-32%
140-160
90-110
500-540
~58-62%
~34-38%CAGR
YoY YoY
CAGR
Source: Zinnov Analysis
Year
CAGR
YoY
Other than the mature enterprise ecosystem, vibrant SMB/Start-up and Government initiatives are driving demand for public cloud services
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Public Cloud Ecosystem in India
Government
1
Large Enterprises
2
SMBs
3
ISV/Startups
4
$7.8 BnEstimated
Government expenditure on
IT in 2016
IT infrastructure refresh cycles
leading to adoption of
cloud services
53 Mn Small
& Medium Businesses
base in India
~4.5K+ tech
enabled startups as of
2016
System Integrators
2
Acquiring companies with niche
cloud capabilities
Cloud Partners
3
~1,600-1,800 public
cloud partners in India
Born in cloud Start-ups
4
~140-160 “Born in Cloud”
partners in India
Source: Zinnov Analysis
Cloud Providers
1
Investment in establishment of datacentres
to cater to local markets including regulated verticals
E-Governance initiatives & Digital India program of Government would result in an uptake of public cloud services
7
eKranti(e-Education | e-
Healthcare | Tech for Planning/ Farmers / Security/ Justice/
Financial Inclusion)
eGovernance(Business Process Re-
engineering | Electronic DBs |
Workflow Automation | Public Grievance Redressal)
Public Internet Access
Programme(Common Service
Centres | PO)
Information for All
(Online doc hosting |
Engagement via Social Media etc.)
IT for Jobs
(Skilled workforce)
Electronics Manufacturing
(Net zero imports by 2020)
Early Harvest Programmes
(Biometric Attendance | Wi-Fi in Universities |
Secure email etc.)
Broadband Highways
(Rural | Urban | National Information Infra)
HighLow
Propensity to use cloud
Platform to accelerate delivery of e-services in the country
GI - Cloud
Secure dedicated personal electronic space for storing docs
Digital Storage
Cloud solution combining machine intelligence and crowd sourcing model
for document processing
Digitization Platform
Repository of productized apps, components & web services hosted on
cloud
Gov App Store
A
B
C
D
Other E-governance Initiatives of Govt. of India
Source: Zinnov Analysis
Universal Access to Phones
(Mobile Connectivity)
Propensity to use Public Cloud
Propensity to use Public Cloud
Mature enterprise ecosystem and huge base of SMBs are driving the demand for public cloud services
Source: Zinnov Analysis
8 Companies in
7 Unicorn Start-ups
8
~380 Companies
> Bn Revenue
$7.8 Bn
Government’s IT Expenditure in 2016
Small & Medium Businesses
51-53 Mn
40% Tech enabled
SMBs
~4.5 K+
Tech Start-ups
India presents an abundant opportunity for public cloud services across different business streams
VerticalsAdoption
RateKey Workloads
HRMS, Backup/Disaster Recovery, Productivity,
Collaboration
ERP, HRM, CRM, Marketingtools, Analytics
CRM, Analytics, Salesforce Management, HRMS
Reporting, Collaboration, F&A, Web Portal Hosting
CRM, Email, HRM, Billing Systems
Backup/Disaster Recovery, SCM, Email, Marketing tools
Public cloud adoption is gaining momentum across leading verticals
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Faster time to market and focus on reducing operations cost is driving demand for public cloud services
IT/ITeS
Manufacturing
BFSI
Healthcare
Telecom
Retail
Manufacturing companies will greatly leverage SaaS solutions to increase product awareness and augment customer outreach
Opening of Datacenters in India in compliance with RBI regulations will drive the adoption of public cloud services
EMR, EHR and Genomics expected to drive demand for data storage in cloud. Healthcare analytics is witnessing traction in the market
Big Data analytics is being leveraged for customer segmentation
Tech savviness of start-ups coupled with the adoption of Big Data analytics is driving the adoption of cloud services
Key Trends
HighLowSource: Zinnov Analysis
IT/ITeS and Manufacturing verticals contribute over 50% of total public cloud spend
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35-45%15-20% 5-10% 4-8% ~5% ~5% <5%
10-20% 100%
Others Total
IT/ITeS Manufacturing M&E E-Commerce Retail BFSI Telecom
Split of Public Cloud Market by Key Verticals: 2016 (E)
Note1: Large companies have been shortlisted on the basis of revenue in FY16Source: Zinnov Analysis
0
10
20
30
40
50
100250
Pu
blic
Clo
ud
Sp
end
($
Mn
)
50 75
Public Cloud Spend by 100 Large Indian Companies1
Investing in a cloud based productivity suite
for entire group & subsidiaries
HRMS and learning management system is deployed on public
cloud
Key account portal, telematics, etc. on
public cloud
1 2 3
$ 500-600 Mn
Number of Companies
Cloud providers are investing across 3 key avenues to cater to Indian market
Infrastructure Talent Partnerships
Global reseller partnership for SAP Hybrid Cloud solutions
Provide infrastructure services for SAP HANA Enterprise Cloud (HEC)
Tata Communications’ IZO Private platform will connect its customers to the CRM solutions of Salesforce
Opened their public cloud datacenter in Chennai
Opened 3 Datacenters in Mumbai, Chennai & Pune
Datacenters in 5 locations in Mumbai
Building 2 new datacenters & expanding capacity to 1.3Mn Sqft
Opening a Tier-3 Datacenter in Gandhinagar
Hiring 200 cloud professionals for Digital sales hub in India
Planning to add 1,000 people across functions in India by 2020
Key Investment Themes
Focus on establishing Datacenters to target IaaS market
Focus on talent development for cloud & digital services
Joint GTM for various cloud solutions
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Setting up a CoE in Vishakhapatnam as a part of its “Digital Inclusion” drive
Jointly launched “Connexion” – a private connection for enterprisesBuilding a datacenter in Chennai
Training 25K people on AWS platform in partnership with NIELIT
Source: Zinnov Analysis, Press Releases
Over 1,600 partners are fulfilling public cloud demand in the Indian market
1,600-1,800
Born in Cloud Partners (2016)
Total Public Cloud Channel Partners in India (2016)
140-160
20-25 % North
25-30 % West 35-40 %
South
5-10 %East
Cloud Partners Split by Location
Illustrative list of “Born in Cloud” partners
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Partner Split by Category
45-50%
30-35%15-20%
<5%
Cloud Partners Landscape
~20%Partners having HQ
outside India
~15%Partners focusing only
on cloud solutions
100%
Resellers SI/ Consulting partners
Technology partners
Distributors Total
Source: Zinnov Analysis, Press Releases
Cloud providers need to alter their sales approach to cater to the new-age enterprises
The decision making on cloud investments is no longer being controlled by the IT department and is involving a lot many stakeholders from the Business, Marketing, Product & Technology groups, among others
13Source: Zinnov Analysis
Traditional Enterprises
CIO
Cloud Migration
New-Age Enterprises
Technology Adoption
CTO
Evolution of Sales Motion for Public Cloud Services
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