Is Cloud Hosting Becoming the New Web Hosting Standard?

10 minutes reading

We often talk about the importance of data in decision-making. Indeed, making a crucial business decision on a whim or a guess can be detrimental to your entire company. This is true for every aspect of your business, including choosing your hosting provider. Of course, as a responsible entrepreneur, you will do your research and find the best hosting provider on the market. However, once in a while it is a good idea to look beyond the current and see how the trends go. After all, a successful business plans ahead. In this regard, there is no better partner than market statistics and forecasts.

An in-depth look at the hosting and website-building markets will give you a significant advantage in choosing the right partners to build up your online presence. In other words, you don’t need the best right now, but the one who will be at the forefront for the long hold.

So, let’s look at some of the most current statistics. Usually, they come up with a bit of delay, as the process of gathering and analyzing data is complex. Thus, today, we will discuss the 2023 fourth-quarter (Q4/2023) statistics and how cloud hosting is no longer just a premium option but rather the standard.

Is Cloud Hosting Becoming The Norm?

Indeed, cloud hosting is becoming the new standard as cloud technologies are becoming increasingly common in any brand’s spending. In fact, Q4/2023 statistics show an 18.5% annual increase in spending on cloud environments. This accounts for a budget of approximately 32 billion dollars in total.

Traditional infrastructure also shows a promising expansion, but with far smaller budgets – up to 19 billion. It’s evident that companies prioritize cloud technologies as a means to optimize their storage needs and utilize the technologies scaling potential and flexibility. This trend actually was sped up by the COVID-19 pandemic, where cloud technology adoption and the flexibility of having access to data from anywhere proved instrumental for the survival of countless businesses. Thus, today, 92% of companies have multi-cloud strategies in place, and 94% of businesses already use at least one cloud service solution.

Cloud server representation

Naturally, cloud infrastructure is booming at the moment and will reach 130 billion dollars by the end of this year, an increase of 19.3% on an annual basis. However, the most impressive statistics show that the growth rate is 14 times faster than that of non-cloud infrastructure, which will only grow 1.4% to $57.6 billion.

Shared cloud solutions, such as shared cloud hosting, will be the biggest contributors to the massive growth of cloud infrastructure. This type of infrastructure will grow by a staggering 21.6% year over year to a respectable 95.3 billion dollars.

Unsurprisingly, cloud hosting is also on the rise, with expected annual growth of 18.3%. By far, shared cloud hosting is the most sought-after hosting solution.

Still, cloud hosting has yet to reach its peak, as most experts suggest that beyond 2024, the industry will experience even higher growth.

What to expect beyond 2024

Cloud technologies are relatively new, and naturally, they are still rapidly growing. In fact, forecasts suggest that by 2028, 73.6% of all spending on computing and storage will go to cloud services. Shared cloud infrastructure will represent 71.8% of all cloud spending with a 12.9% compound annual growth.

Experts suggest that the entire cloud exosystem will reach sales of over a trillion dollars in the next four years. By the end of the decade, some more optimistic forecasts suggest the entire market will reach 2.43 trillion dollars, quadrupling the current revenues.

Though not all of these revenues will go to cloud hosting companies, the trend of going cloud is more than evident. Thus, the current 18.3% market share of cloud hosting will significantly rise, as it’s expected to reach 158 billion dollars by the end of this year and double its revenues to 345 billion dollars by 2028.

Forecasting representation

This shows that the much more reliable, fast, and secure cloud hosting will rapidly replace traditional hosting solutions in the near future. This is hardly surprising, considering the importance of fast loading time and decreasing downtime. Unfortunately for conventional hosting providers, cloud hosting is simply superior and offers far more opportunities for the same price or even cheaper.

Companies are naturally looking for more cost-efficient solutions to their hosting needs. Thus, since cloud hosting offers an affordable yet reliable, fast, and secure solution, it will continue to grow in demand.

Naturally, the hosting market will change over time. That doesn’t mean it will shrink. On the contrary, data shows it will only continue to rise.

The Web Hosting Industry Continues to Rise

With 1.1 billion websites in the world today, which continue to grow daily, it’s hardly a surprise that the website hosting industry is on the rise. Something more. It will continue to rise in the foreseeable future. In fact, by the end of the decade, the industry will be worth nearly 400 billion dollars. Most of the revenue comes from North America, which is the fastest-growing hosting market. Almost 42% of all hosting revenue comes from North America.

Naturally, shared hosting is the most popular choice among users. Roughly 42.5% of website owners prefer shared hosting. That’s hardly surprising, as only about 18% of all websites are actually active and regularly updated.

Statistics representation

In a nutshell, the hosting industry is growing healthy, though there is a massive shift towards cloud solutions. As already stated, 18.3% of website owners prefer cloud hosting, which is the most preferred option. The second choice is the traditional non-cloud shared hosting, which will likely rapidly decrease in popularity in the next few years. Dedicated web hosting is traditionally steady, as about 5.6% of website owners prefer the security and flexibility of having their own server. However, even with dedicated servers, trends suggest that business owners would shift toward dedicated cloud servers. This allows them greater flexibility, scalability, and security.

Still, another option has become a favorite in the past few years. Mostly among mid-sized businesses that can’t afford to operate a dedicated server. This relatively new solution is the VPS.

VPS Services Are Becoming a Hit

Virtual Private Server (VPS) hosting is often cramped together with shared cloud hosting since both share many similarities. They both are unparalleled when it comes to flexibility and scalability in performance. Still, there are many differences between the two, as the VPS hosting service provides better security, more flexibility, and more resources. Naturally, this type of hosting is less popular than shared cloud hosting, but its market is also growing at a rapid pace.

The latest data shows that about 10.3% of website owners prefer a VPS. This number, however, is a bit outdated, as it was last surveyed in 2018. With the market’s annual growth, one can easily determine that this percentage is no longer accurate. For example, the market size in 2018 was just 2.6 billion dollars. In 2026, it is expected to reach 8.3 billion dollars. Currently, the market size is approximately 4.5 billion dollars. Experts expect the market to rise steadily by 12.4% over the next eight years over the entire period.

VPS representation

While these statistics are less overwhelming than the numbers of cloud hosting altogether, keep in mind that VPS hosting solutions are actually pretty niched. However, with the rise of online purchases and trade, an increasing number of small and middle-sized businesses opt for this more flexible and easily scalable solution. Still, the day when the VPS hosting solution will become the most preferred is not in sight. Just like there is no competitor in sight for WordPress domination on the CMS Market.

WordPress Is Still Crushing The CMS Market

Is this really a surprise? WordPress continues to dominate the website builder and CMS markets. To be more precise, 43.3% of all websites were built on WordPress. When it comes to CMS, however, the market share is much more staggering – 63.7% of websites use WP as their backend solution. This includes 14.7% of the top-rated websites in the world.

These stats are hardly surprising, as WordPress has made building a website much like a game. With its recent release, its interface and usability have taken a new step toward meeting customer expectations. And since their market share is standing steadily at the top, far from their competitors, one can hardly argue with the results.

More than 80% of WordPress users already use the latest 6th version, which shows that these websites are alive and maintained. Only approximately 5% still use v.4 and 3, which we can assume were abandoned.

WordPress representation

With 409 million people looking through 20 billion pages created on WordPress and its plugins, it is obvious that the website builder is worth a try.

So, speaking of data-driven decisions, what better website builder to use than the one that literally crushes the market? And if you are still wondering whether you need a website, well, you are about four years too late. Today, websites are a must, and here are the stats to prove it.

29% Of All The Business Bears Place Online

Since 2020 and the COVID-19-induced lockdowns, trade has never been the same. People were forced to leap into the digital world whether they liked it or not. It seems they liked it, today, 28.8% of all business is conducted online. Moreover, e-commerce is already claiming over a fifth of the overall retail global market, with forecasts suggesting it will reach 6.5 trillion dollars by the end of 2024. This industry will only continue to grow. Experts are adamant that by 2027, e-commerce will own 23% of the market. Its total value will rise to nearly 8 trillion dollars.

If that’s not lucrative enough, consider the vast reach the Internet can provide. With 52% of online consumers ordering internationally, you can extend your reach far beyond city, state, or even national borders.

Moreover, e-commerce offers a sustainable income, as 34% of online shoppers will buy at least once a week. Thus, you can enjoy a steady income and retention rate if you become a fan favorite. To be able to achieve this, however, you need to consider your customer experience.

E-commerce representation

Though mobile-friendly websites have been the standard for more than five years now, this is no longer enough to capture the audience’s attention. You need to consider the smartphone user’s experience before all else. With 91% of people using their phones to make a purchase, it’s hardly a surprise that mobile commerce will account for 62% of all retail sales by 2027, or 856 billion dollars annually.

So, if you want to stay in front of the competition, consider creating a dedicated app. The investment is substantial, but it will undoubtedly pay off. The app will bring better usability and, more importantly, much better speed. And as it seems, in 2024 and beyond, speed will be everything.

Website Speed Will Become Even More Important

Website speed has always been fundamental for your website’s success. Even though the average website loading time is 2.5 seconds for desktop and 8.6 seconds, that doesn’t mean you should aim to be just barely above the average. A wiser strategy would push you toward a goal that can help you skyrocket your organic traffic. For this to happen, however, you need to get on Google’s first page. The average speeds there, however, are 1.65 seconds for desktops. Adding the customer expectation for your website to open within 3 seconds and the threat of losing 40% of your audience after this threshold should be enough to show that website speed is instrumental to your success.

Moreover, higher speed will increase overall organic traffic by improving your SEO score. For example, a website that opens in less than three seconds will get an average of 9% bounce rate. On the other hand, a website that opens for 5 seconds or slower will quadruple the bounce rate up to 38%. 

Website speed representation

Furthermore, the percentage of customers expecting better website speed is constantly increasing. While a few years back, less than half of online shoppers would leave due to a load delay, in 2024, more than 64% (2/3) of customers will instantly close your online shop and find a new one to buy their goods.

That’s why cloud hosting is such a huge hit. With the cloud infrastructure, website loading time is much faster and less likely to go down due to resource deficiency.

Why Are These Statistics Important When Choosing a Hosting Company

Knowing the most current statistics is instrumental to your planning process. Yes, statistics are always a bit behind the trends. Still, they can reaffirm your goals and actions and help you plan your next quarter’s targets. For example, seeing how e-commerce grows rapidly, scaling your target quotas for the next quarter can be data-driven instead of just wishful thinking.

Moreover, the latest statistics irrefutably show that cloud hosting is quickly becoming the new standard. So, don’t wait for the last train to catch the hype. Being among the first is almost always beneficial if, of course, your decision is made based on serious data. The one we shared today is extracted from the most reliable sources out there. So, outpace your competitors and join HostArmada‘s vast customer club. We offer lightning-fast website load speed, state-of-the-art security, and a 99.9% uptime guarantee. Partnering with us will give you the much-needed boost to bring your Q2, Q3 and Q4 plans to fruition.

Check out our plans and consider whether our top-notch VPS hosting service will give you the edge you’ve been looking for. As always, if you are unsure of the best choice for you, just ask our team. We will gladly help you decide on the best plan for your needs.