1.
1
This report is solely for the use of Zinnov Client and Zinnov Personnel. No Part of it may be quoted, circulated or reproduced for distribution outside the client organization without prior written approval from Zinnov
Sep, 2016
Public Cloud Market Landscape:
India

2.
Zinnov used multiple level of analysis backed by various sources of information
to estimate market size
2
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
1
• 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
4
• Zinnov framework which
includes various macro and
industry specific factors
responsible for IT and cloud
market growth

3.
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-2016
India 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)

4.
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)

5.
At $2.6-2.8 Bn, SaaS will continue to be the biggest segment within public cloud
followed by IaaS & PaaS cumulatively accounting for ~$1.2 Bn by 2020
5
SaaS IaaS PaaS
2015
2016
2020
Cost-effective cloud workloads enabling
enterprises and SMBs to optimize cost
Establishment of datacenters is enabling
rapid adoption of IaaS
Investment in Developer ecosystem
driving demand for PaaS solutions
($ 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

6.
Other than the mature enterprise ecosystem, vibrant SMB/Start-up and
Government initiatives are driving demand for public cloud services
6
Public Cloud Ecosystem in India
Government
1
Large
Enterprises
2
SMBs
3
ISV/Startups
4
$7.8 Bn
Estimated
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

7.
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

8.
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

9.
Verticals
Adoption
Rate
Key Workloads
HRMS, Backup/Disaster
Recovery, Productivity,
Collaboration
ERP, HRM, CRM, Marketing
tools, 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
9
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
HighLow
Source: Zinnov Analysis

10.
IT/ITeS and Manufacturing verticals contribute over 50% of total public cloud
spend
10
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 FY16
Source: Zinnov Analysis
0
10
20
30
40
50
100250
PublicCloudSpend($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

11.
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
11
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

12.
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
12
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

13.
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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