Rathbones' Derber: We are in a multidecade transition to the cloud

6% of IT spent on cloud

After the first on-premise databases and servers were introduced in the early 1980s, it took another 40 years for the growth in on-premise vendors to reach full maturity.

If the next platform shift follows a similar trajectory, our best guess is that we are only in the first or second inning of a multi-decade transition to the cloud. Given its ubiquity, you may find it surprising that companies have so far only redirected a small fraction of their IT budgets to the cloud. This offers investors one of the most compelling secular growth opportunities of the next decade. In 2020, only 6% of the $3.6trn spent globally on IT was spent on the cloud (about $220bn). When comparing that with the growth in US online spending as a percentage of total retail sales...