PUBLISHER: Market Xcel - Markets and Data | PRODUCT CODE: 1536769
PUBLISHER: Market Xcel - Markets and Data | PRODUCT CODE: 1536769
Global cloud FinOps market is projected to witness a CAGR of 12.41% during the forecast period 2024-2031, growing from USD 9.10 billion in 2023 to USD 23.20 billion in 2031. The fast-growing Cloud Financial Operations (FinOps) market is driven by cloud expansion and cost visibility concerns. Organizations like Roblox are reorganizing around the new top priority of reducing cloud waste and managing commitment-based discounts, as reported in a FinOps Foundation survey that reflects a shift from empowering engineers. Reducing waste became the number one priority in 2024 due to increasing cloud costs and better financial forecasting. 1,245 respondents in the survey actively manage USD 55 billion of cloud spend and they are increasingly invested in optimization tools and forecasting. To meet these new financial challenges, FinOps practices are continuing to evolve while AI/ML costs increased.
For instance, in April 2024, Amazon Web Services, Inc. launched AWS Deadline Cloud, a fully managed service designed to optimize cloud-based rendering pipelines. The new offering supports Cloud FinOps by providing scalable and cost-effective rendering solutions with detailed budget management, enabling efficient financial oversight and flexibility in content production.
Increased Cloud Adoption to Drive Growth of Cloud FinOps Market
Cloud FinOps market is witnessing growth owing to the impact of emerging cloud technologies with the continuous research and development by main cloud providers including Alphabet Inc., Microsoft Corp., and Amazon Web Services Inc. to improve their financial operations with improved data visualization and cost optimization AI-driven insights. Oracle Corp. deployed FOCUS with more advanced features for resource scheduling and a centralized FinOps management. These advances mutually allow for more detailed cross-cloud financial analysis and decisioning while improving efficiency in driving down costs. When it is integrated with FinOps tools, cloud technologies will continue to evolve, helping organizations streamline financial management leading to performance optimization of resources and savings more cost-effectively in the public cloud environments.
For instance, in July 2023, Innova Solutions, Inc. partnered with CoreStack (Cloudenablers, Inc.) to enhance digital innovation and cloud investment optimization. CoreStack's AI-driven multi-cloud governance, including FinOps and CloudOps, will provide enterprises with better visibility and management of cloud expenses and compliance.
Complexity in Cloud Cost Management Fuels the Cloud FinOps Market Growth
The increasing complexity of cloud cost management is driving the penetration and adoption of cloud financial operation services. Modern cloud strategies emphasize on governance control and cost optimization as it is important because 90% of organizations are already experiencing some level of waste or underutilized cloud spending, over half of the cloud users claim to waste at least 15% of their budget. According to International Data Corporation, effective cost management has become essential in developing any higher-level business-technology strategy. Transition to FinOps allows organizations the ability to react in real-time by building a core competency for all cloud management. This focus on cost control, driven by inflation, recession concerns, and rising cloud bills, highlights the strategic importance of FinOps in ensuring efficient and sustainable cloud resource use.
For instance, in May 2024, Amazon Web Services, Inc., an Amazon.com, Inc. company, launched a console-based bulk policy migration tool for the Billing and Cost Management console, simplifying updates of retired IAM actions and ensuring risk-free migration and customization.
Government Initiatives Acting as a Catalyst
Cloud FinOps market is growing due to increased government initiatives across the globe. The United States Federal Cloud Strategy focuses on effective cloud cost management and European Union Cloud Rulebook with an emphasis transparency, and accountability. G-Cloud Framework contracts with the public sector using the United Kingdom Government's G-Purchase Cloud Framework which lets any Public Sector body purchase lower cost cloud. For instance, MeghRaj initiative in India advocates cloud usage for departmental sharing and reuse as the default policy whereas Australia's Secure Cloud Strategy focuses on cost control and resource utilization. This is encouraging organizations to manage cloud costs efficiently by adhering FinOps best practices, which in turn drives the growth of Cloud FinOps market. The outcome will be improved and optimized cloud resource utilization across domains.
For instance, in January 2024, The Infocomm Media Development Authority (IMDA) and the Government Technology Agency (GovTech) of Singapore have launched a USD 30 million Green Computing Funding Initiative to advance digital sustainability, supporting Cloud FinOps with eco-friendly cloud solutions.
BFSI Sector to Dominate the Global Cloud FinOps Market Share
BFSI sector is leading the demand for Cloud FinOps, backed by an impressive rise in funding. Total spending on Infrastructure-as-a-Service (IaaS) surged 35.5% year-on-year during 2023, totaling USD 25.8 billion in annual contract value (ACV). BFSI contributed 63% with an investment upward to USD 4.1 billion witnessing a 43% surge over 2022 levels of the total USD 6.5 billion in ACV of technology outsourcing deals signed during 2023. Financial institutions are increasingly turning to hyperscale cloud providers to manage growing capacity demands, enhance analytics and automation, and drive digital transformation. BFSI sector uses the most amount of cloud solution, representing a key component in driving the development of cloud FinOps market.
North America Dominates the Global Cloud FinOps Market Share
North America dominates the global cloud FinOps market, driven by its technological ability and early adoption. Major cloud service providers such as AWS, Azure, and Google Cloud are based in the United States and Canada market, driving increased demand for solutions helping in sophisticated financial operations. Companies in North America are utilizing Cloud FinOps to manage rising cloud costs, improve financial visibility, and optimize resource use. A significant increase in the adoption of Cloud FinOps tools reflects the growing importance in financial efficiency in North America. Additionally, North America's investment in AI and automation for cloud management further cementing its leadership in the market.
For instance, in August 2023, Cloudelligent LLC, an AWS Advanced Consulting Partner, and CoreStack (Cloudenablers, Inc.) partnered to offering NextGen Cloud Governance, integrating FinOps, SecOps, and CloudOps. This solution optimizes AWS infrastructures, enhances cost management, and accelerates innovation for enterprises.
Future Market Scenario (2024 - 2031F)
Cloud FinOps will become more automated, with AI-based tools informing cost management and resource allocation decisions so your operations team doesn't have to manage costs manually.
Organizations will adopt more hybrid cloud environments, combining on-premises and off-site resources for agility and cost savings.
Rising concerns about Data safety will trigger the integration of state-of-the-art protection records and compliance tools inside Cloud FinOps strategies.
Businesses will diversify their cloud portfolios across multiple providers, leveraging competitive pricing and avoiding vendor lock-in.
Key Players Landscape and Outlook
CoreStack is the leader in cloud governance and cost optimization, while Flexera Software delivers a wide range of tools for cloud financial management and optimization. Enterprise Cloud Services is the FinOps Foundation practice area, where HCL has demonstrated its experience and capacity. The market is expected to grow with the increasing need for cost efficiency and automated financial management across the cloud environment. As cloud adoption has expanded, these players are poised to fuel innovation and address the changing financial services landscape.
In April 2024, CoreStack (Cloudenablers, Inc.) and TD SYNNEX Corp. partnered to launch the FinOps Circle of Excellence (COE), integrating CoreStack's AI-driven FinOps with AWS's Well-Architected Framework to optimize cloud costs and enhance financial operations.
All segments will be provided for all regions and countries covered
Companies mentioned above DO NOT hold any order as per market share and can be changed as per information available during research work.