Market Overview:
The UK cloud computing market was valued at USD 27.48 Billion in 2024 and is forecast to reach USD 97.21 Billion by 2033, growing at a CAGR of 14.92% during 2025-2033. London leads the market due to demand for affordable IT infrastructure, remote work expansion, and rapid digital transformation. Hybrid and multi-cloud solutions are driving adoption, supported by government investments and cloud-friendly policies that enhance operational agility in the digital economy.
Study Assumption Years:
Base Year: 2024
Historical Years: 2019-2024
Forecast Period: 2025-2033
UK Cloud Computing Market Key Takeaways:
- Current Market Size: USD 27.48 Billion (2024)
- CAGR: 14.92% (2025-2033)
- Forecast Period: 2025-2033
- Data sovereignty requirements and UK GDPR enforcement drive demand for local data centers to ensure compliance.
- AI and ML technology expansion increases the need for high-performance cloud infrastructure, supported by AWS’s £8 Billion investment.
- The UK government’s £39 Billion data center investment boosts cloud adoption nationwide.
- Public cloud deployment leads due to cost efficiency and accessibility, especially among SMEs.
- London dominates due to its financial sector, multinational presence, and government-driven innovation.
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UK Cloud Computing Market Trends and Drivers
Data sovereignty and regulation have been major drivers for the UK market. Because the UK GDPR legislation enforces data residency within the UK, many cloud service providers have established national data centers. This can make compliance streamlined and make transparency and trust increase in heavily regulated sectors such as healthcare, banking, and government services, which accelerates cloud adoption.
Rapid advancements in AI and ML are driving market growth across industries. However, scalable high-performance computing is needed in order to meet the demand for real-time analysis, training AI models, and automating processes. Cloud platforms may provide AIaaS (AI as a Service) at reduced costs. In 2024, to meet demand from enterprise and public sector, AWS invested £8 Billion in AI and cloud infrastructure.
Rising demand for scalable, cost-effective IT services drives the market. The UK government has invested an additional £25 Billion into data center infrastructure taking the total investment to £39 Billion, expanding the national cloud infrastructure. Cloud computing’s pay-as-you-go model reduces capital expenditure and is helpful for all organizations, including SMEs and large enterprises globally. Hybrid and multi-cloud adoption also provides growth opportunities through operational agility. Today, cloud contracts in the public sector are worth around USD 1.3 Billion.
Market Segmentation:
By Service:
- Infrastructure as a Service (IaaS)
- Platform as a Service (PaaS)
- Software as a Service (SaaS): Dominated 55.9% market share in 2024, supported by flexible subscription models and simplified IT management.
By Deployment:
- Public
- Private
- Hybrid
By Workload:
- Application Development and Testing
- Data Storage and Backup
- Resource Management
- Orchestration Services
- Others
By Enterprise Size:
- Large Enterprises: Held 58.6% market share in 2024, leveraging cloud for global operations and advanced analytics.
- Small and Medium Enterprises
By End-Use:
- BFSI: Accounted for 21.7% in 2024, driven by automation, compliance, and enhanced customer experience.
- IT and Telecom
- Retail and Consumer Goods
- Manufacturing
- Energy and Utilities
- Healthcare
- Media and Entertainment
- Government and Public Sector
- Others
Regional Insights:
London is the leading region in the UK cloud computing market with a high concentration of financial institutions, multinational firms, and government bodies. The region benefits from significant data center investments, advanced connectivity, and high cloud adoption across industries such as healthcare, e-commerce, and banking, making it the core hub for cloud innovation in the UK.
Recent Developments & News:
- May 2025: EY launched its Integrated Finance Managed Service in the UK using SAP S/4HANA Cloud and AI.
- March 2025: Google Cloud introduced “Gemini for the United Kingdom” with UK data residency and up to GBP 280,000 in cloud credits for AI startups.
- January 2025: CoreWeave opened UK data centers equipped with NVIDIA H200 GPUs and advanced InfiniBand networking, part of its GBP 1 Billion AI infrastructure investment.
Key Players:
Amazon Web Services (AWS)
EY
Google Cloud
CoreWeave
Wiz
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