The personal cloud storage market was valued USD 25.25 billion in 2019 and is expected to reach USD 117.3 billion by 2029, with a CAGR of 25% during the forecast period.
Personal cloud storage (PCS) is local network-attached storage (NAS) device that lets users store data, photos, music, videos, and other files and is optimized for media streaming. PCS provides continuous access to employees and keeps their documents secure, which encourages organizations to incorporate these services into their business. Moreover, PCS has wide scope in small and medium enterprises in various end-use industries. The rapid increase in demand for digitization among the people, surge in digital content and internet usage, and the need for disaster recovery and contingency plans are the factors propelling the market growth. However, data security and privacy concerns hinder the market growth.
Many businesses are now transitioning online in a bid to streamline the management and day-to-day running of operations. This shift is being powered by a new wave of technology that allows companies of all shapes and sizes to be more strategic and efficient. This transition of businesses is to continue as more businesses understand the benefits of digitization, which includes storing documents, online backups, and workflow and document management to remote working. As per industry experts, approximately 44% of companies have adopted digitization to enhance their business operations and working efficiency.
The indirect revenue segment holds the highest market share during the forecast period. The indirect revenue refers to the source that includes advertising, various business tie-ups with major technology providers, and licensing, among others. The surge in electronic advertising across the globe is one of the key factors propelling market growth. In August 2019, Reliance Industries Limited partnered with the Microsoft-Azure Cloud Platform to offer comprehensive technology solutions from computing and storage to connectivity and productivity to small and medium businesses.
The enterprise segment dominates the market on account of the convergence of cloud with mobile devices, which enable enterprises to adopt personal cloud storage and access to work content from remote locations at any time. Furthermore, increasing investment among the enterprises to upgrade their infrastructure and meet the increasing demand of consumers fosters the segment growth. For instance, in May 2020, Microsoft announced plans to invest about USD 1 billion in a digital transformation plan in Poland to drive and accelerate their digital transformation, boosting competitiveness and support employment opportunities in the market.
The service provider segment is projected to grow with the highest CAGR on account of the burgeoning adoption of cloud storage among the enterprises, particularly SMEs. This enables cloud service providers to help businesses transform their wide-ranging processes. Furthermore, the broad capabilities of cloud storage have led to a surge in the adoption of cloud storage, which provides access to powerful capabilities once outside the reach of the smallest companies. For instance, according to Emergent Research and Intuit, approximately 80% of U.S. small businesses deploy cloud storage.
The impact of COVID-19 has had a devastating effect on all industry verticals globally. However, the growth of cloud storage has slightly increased amidst the pandemic due to lockdown imposed by the governments and work-from-home implemented by corporates. This has resulted in the adoption of cloud storage to store large documents and share files, among others. Furthermore, the high-security offering of cloud services is also one of the factors leading to the adoption of cloud storage amidst the pandemic.
North America is the fastest adopter of cloud storage and is presumed to grow during the forecast period. The presence of numerous giant companies offering cloud storage, such as AWS, Microsoft, Apple, and Google, and increasing investment in developed economies in research and development foster market growth. Early adoption of technology among enterprises to upgrade its infrastructure to meet the increasing need of the customers also leads to the development of the cloud storage market. Additionally, the presence of a large number of SMEs in the region that prefer to adopt cloud storage on account of budget constraints further pave the way for an increase in the market of cloud storage.
Asia-Pacific is the fastest-growing region in the adoption of cloud storage and is presumed to grow during the forecast period. Increasing investment in the developing economies, such as China and India, and surging government initiatives, such as Make in India and Digital India, fuel the market growth. Rising foreign direct investment in the region provides an impetus to the market growth. For instance, in July 2020, Google announced plans to invest approximately USD 10 billion in the Digital India initiative.
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