Application Hosting Global Market Report 2024

The application hosting market has grown rapidly in recent years. It will grow from $85.91 billion in 2023 to $97.18 billion in 2024 at a compound annual growth rate (CAGR) of 13.1%. The growth observed during the historical period can be attributed to several key factors. These include a rising demand for scalability in computing resources, a focus on cost efficiency in business operations, the globalization of businesses leading to increased adoption of cloud solutions, heightened concerns regarding security, the surge in e-commerce activities, and the integration of DevOps practices for enhanced collaboration between development and operations teams. Collectively, these factors played a significant role in driving the expansion of application hosting services during the historical timeframe.

The application hosting market is expected to see rapid growth in the next few years. It will grow to $155.1 billion in 2028 at a compound annual growth rate (CAGR) of 12.4%. The anticipated growth in the forecast period can be attributed to several key factors. These include the adoption of edge computing technologies, the increased uptake of hybrid cloud solutions, ongoing trends in remote workforce management, a heightened emphasis on cybersecurity measures, and the implementation of industry-specific solutions. Major trends expected in the forecast period encompass the widespread adoption of cloud-native technologies, the integration of edge computing into various applications, the continued growth of hybrid and multi-cloud strategies, a heightened focus on security and compliance measures, and the expansion of serverless computing solutions. These trends are poised to significantly impact and drive growth in the application hosting industry, reflecting the evolving technological landscape and business requirements in the forecasted period.

The escalating demand for physical security is poised to propel the application hosting market's growth in the foreseeable future. Physical security pertains to safeguarding personnel, hardware, programs, networks, and data from physical events that could cause significant losses or harm to an enterprise, agency, or organization. Application security controls involve methods aimed at bolstering an application's coding-level security, reducing its susceptibility to cyberattacks. For instance, in January 2021, IT Governance reported 1,243 security events resulting in the compromise of 5,126,930,507 records. This marked an 11% increase in security incidents compared to 2020 (1,120 incidents), although the number of compromised records decreased from 20.1 billion to 19.1 billion over the same period. Hence, the growing emphasis on physical security is a key driver behind the application hosting market's expansion.

The increasing adoption of cloud computing is anticipated to drive the growth of the application hosting market. Cloud computing offers on-demand access to IT resources via the internet, providing a spectrum of services such as servers, storage, databases, networking, and software. This technology empowers application hosting services to furnish instant access to computing resources, including servers, storage, databases, and software, over the internet. For instance, in December 2021, Eurostat reported that 41% of EU enterprises utilized cloud computing, primarily for hosting email systems and storing electronic files, marking a 5-percentage point increase from 2020. In the EU, large businesses demonstrated a 72% adoption rate of cloud computing in 2021, representing a 7-percentage point increase from 2020. Consequently, the rising adoption of cloud computing stands as a significant driver fueling the growth of the application hosting market.

Product innovations emerge as the prominent trends gaining momentum in the application hosting market. Significant players within this market are dedicated to developing innovative products to fortify their market position. For instance, in November 2022, Kinsta, a US-based Applications Hosting provider, introduced a reliable and comprehensive Platform-as-a-Service (PaaS) offering both Application Hosting and Database Hosting. This platform operates on a per-usage billing system, charging based on runtime and database size, providing customers with a streamlined billing experience.

Leading companies in the application hosting market are focused on introducing next-generation, sophisticated solutions to gain a competitive advantage. Advanced application hosting services denote computing platforms that facilitate software delivery over the internet, serving as operational platforms for a wide array of software applications. For example, in September 2023, InMotion Hosting, a US-based website hosting firm, unveiled Platform InMotion, its novel cloud WordPress hosting plans, and server management platform. Users can design, manage, and launch websites on a high-performance VPS optimized for WordPress - all through a unified dashboard. Platform InMotion optimizes WordPress websites through its unique UltraStack configuration, Redis, server-side caching profiles, and high-performance cloud servers. This results in faster, more responsive websites, coupled with the assurance that the company's adept Technical Support and System Administration teams oversee the hosting infrastructure management.

In November 2022, Summit Hosting, a United States-based company specializing in virtual servers and cloud-based application hosting, completed the acquisition of Handy Networks for an undisclosed sum. This strategic acquisition was aimed at obtaining businesses associated with Server Hosting, Application Hosting, Colocation, HIPAA compliance hosting, as well as backup and disaster recovery services. The primary objective behind this acquisition was to further broaden the range of services offered to their clientele. Handy Networks LLC, the acquired entity, is recognized as a US-based provider offering global hosting and cloud solutions.

Major companies operating in the application hosting market report are International Business Machines Corporation, Amazon.com Inc., Rackspace Hosting Inc., Microsoft Corporation, Alphabet Inc., Sungard Availability Services Inc., Liquid Web LLC, DXC Technology Company, Navisite Inc., Apprenda Inc., Charter Communications Inc., Oracle Corporation, Red Hat Inc., TIBCO Software Inc., The Apache Software Foundation, Fujitsu Limited, DigitalOcean Inc., Salesforce Inc., Salesforce Inc., VMware Inc., Endurance International Group Inc., HostGator.com LLC, A2 Hosting Inc., Linode LLC, Joyent Inc., Pantheon Systems Inc., Media Temple Inc., SiteGround Hosting Ltd., DreamHost LLC, NeXcess LLC, Vultr Holdings LLC, Contegix Inc., Atlantic.Net Inc., Arvixe LLC, InMotion Hosting Inc., UKFast.net Limited, iWeb Technologies Inc.

North America was the largest region in the application hosting market in 2023. Asia-Pacific is expected to be the fastest-growing region in the global application hosting market report during the forecast period. The regions covered in the application hosting market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the application hosting market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The primary types of application hosting include managed hosting, cloud hosting, and colocation hosting. Managed hosting involves a third-party provider taking responsibility for the administration, troubleshooting, and maintenance of an organization's hardware or cloud computing resources. The suite of services includes application monitoring, application programming interface (API) management, infrastructure services, database administration, backup and recovery, and application security. These services cater to organizations of various sizes, ranging from small and medium-sized enterprises (SMEs) to large enterprises.

The application hosting market research report provides application hosting market statistics, including application hosting industry global market size, regional shares, competitors with an application hosting market share, detailed application hosting market segments, market trends and opportunities, and any further data you may need to thrive in the application hosting industry. This application hosting market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The application hosting market includes revenues earned by entities by providing hosting platforms, managing hosting, and cloud hosting. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.


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