The Asia/Pacific (APAC) public cloud services market is on the cusp of dramatic expansion, according to IDC’s latest projections, surging from $53 billion in 2024 to $131 billion by 2029 at a striking 19.8% CAGR.
Fueled by rapid IT modernization, the region’s shift toward digital transformation and integration of artificial intelligence are set to be the prime catalysts, intensifying demand for cloud-based infrastructure (IaaS), platforms (PaaS), and software (SaaS) solutions.
Key industries—government, healthcare, and banking—are at the forefront, driving a region-wide embrace of cloud-first strategies. These sectors are increasingly relying on the cloud to modernize legacy systems, streamline operations, and unlock new business models centered on data and scalability.
IDC’s experts underscore that the region’s surge is rooted in the convergence of AI and cloud, positioning cloud infrastructure as the essential backbone for next-generation intelligent applications and digital services.
“The Asia/Pacific cloud ecosystem is entering a new phase. Organizations are leveraging cloud-native platforms and AI integration not simply to migrate workloads, but to redefine innovation and efficiency,” noted an IDC analyst recently. IDC’s data shows that software providers—led by AWS, Google Cloud, Microsoft, Salesforce, and SAP—collectively contributed over $41.5 billion to regional cloud revenue in 2023, with GenAI products making their biggest impact in PaaS and SaaS segments.
Indeed, PaaS recorded the highest annual growth rate as developers adopt AI-powered services, while SaaS continues to account for over 60% market share, IDC noted.
Despite the upbeat outlook, IDC warns that legacy system migration challenges, regulatory compliance, and an acute shortage of cloud and AI-skilled talent persist. To address these obstacles, cloud providers are expanding localized infrastructure, including sovereign clouds and hybrid cloud models, which enhance data considerations for regulatory requirements and boost organizational resilience.
Moreover, the demand for managed and professional cloud services is steadily rising, as companies seek expertise for navigating complex cloud landscapes and accelerating digital transformation.
Strategic investments aimed at cloud sovereignty, next-generation connectivity (such as 5G), and green data centers further buoy the regional market.
As governments and enterprises ramp up cloud-native adoption, IDC anticipates cloud will solidify its role as the foundational technology for Asia/Pacific’s fast-evolving digital economy.
In summary, Asia/Pacific’s public cloud market is set to be the world’s fastest growing, underpinned by soaring digital ambitions, the rise of AI, and aggressive investment in modern infrastructure.
Despite lingering obstacles, the pathway to $131 billion by 2029 is clear: cloud innovation will remain central to economic and technological transformation in the region.
