Ashika Monthly Insight August 2016
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AUGUST <strong>2016</strong><br />
SECTOR OUTLOOK<br />
According to National Association of Software and<br />
Services Companies (NASSCOM), the Indian IT sector is<br />
forecasted to grow at a rate of 10%-12% in FY2017 in<br />
constant currency terms. NASSCOM President R<br />
Chandrashekar dismissed the recent dismal performance<br />
of the IT companies and said that the IT sector continues<br />
to enjoy high revenue visibility over the near term.<br />
According to a report by NASSCOM and Zinnov<br />
Management Consulting Pvt Ltd, India is the fourth largest<br />
base for new businesses in the world and home to over<br />
3,100 tech start-ups, is set to increase its base to 11,500<br />
tech start-ups by 2020.India’s internet economy is<br />
expected to touch Rs 10 trillion ($146.72 bn) by 2018,<br />
accounting for 5% of the country’s GDP, according to a<br />
report by the Boston Consulting Group (BCG) and Internet<br />
and Mobile Association of India (IAMAI).<br />
Social, Mobility, Analytics and Cloud (SMAC) are<br />
collectively expected to offer a $1tn opportunity.<br />
According to IBEF, Cloud represents the largest<br />
opportunity under SMAC, increasing at a CAGR of<br />
approximately 30% to around $650-700bn by 2020<br />
followed by social media sector which offers a $250 bn<br />
market opportunity by 2020.Public cloud services revenue<br />
in India is expected to reach $ 838mn in 2015, growing by<br />
33 per cent year-on-year (y-o-y), as per a report by Gartner<br />
Inc. In yet another Gartner report, the public cloud market<br />
alone in the country was estimated to treble to US$ 1.9<br />
billion by 2018 from US$ 638 million in 2014. Increased<br />
penetration of internet (including in rural areas) and rapid<br />
emergence of e-commerce are the main drivers for<br />
continued growth of data centre co-location and hosting<br />
market in India.<br />
Cloud based services to be the key thing going forward:<br />
The public cloud services market in India is projected to<br />
grow 30.4% in <strong>2016</strong> to total $1.26bn and reach $3.5bn by<br />
2020, according to Gartner, Inc. The highest growth will<br />
come from cloud system infrastructure services<br />
(infrastructure as a service [IaaS]), which is projected to<br />
grow 32.5% in <strong>2016</strong>, with platform as a service (PaaS)<br />
projected to grow 31.7%.<br />
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