Infrastructure-as-a-Service Market Size

Infrastructure-as-a-Service (IaaS) Market size was valued at USD 120.89 billion in 2024 and is expected to reach USD 2.36 trillion by 2037, expanding at around 25.7% CAGR during the forecast period i.e., between 2025-2037. In the year 2025, the industry size of infrastructure as a service is assessed at USD 147.3 billion.

The growth of the market can be attributed to increasing digitalization and technological advancements, high demand for managed cloud computing services, and adoption of IaaS solutions led by increasing need for organisations to reduce the IT burden and lower the incurred cost. Furthermore, government initiatives to encourage the adoption of the internet and other advanced technologies in their economies are supporting the growth in this infrastructure-as-a-service market.

Infrastructure-as-a-service (IaaS) is a cloud computing form with which organisations can outsource their data center capabilities to an external cloud service provider. It frees up human resources and allows consumer to adjust processing capacity by scaling the infrastructure resources in an automated manner. Along with platform-as-a-service (PaaS) and software-as-a-service (SaaS), IaaS forms one of the core service models of cloud computing and is the second largest segment of the global public cloud market.

Moreover, benefits such as cost-effectiveness owing to optimum utilization of computing resources, efficient management and data control, and escalating demand of disaster recovery, storage, and virtualization are also responsible for the upsurge adoption of IaaS solutions.

However, concerns over data protection, privacy and security are restraining the adoption of IaaS solutions, hindering the growth of the infrastructure-as-a-service (IaaS) market. In addition to that, lack of proper infrastructure and awareness about the capabilities of cloud infrastructure are further challenging the growth of the market.