Growth in public cloud services in Australia are projected to outpace global services at 17.5 percent in 2016, jumping from A$4.74 billion last year to $5.57 billion in 2016, according to a Gartner report.
The worldwide market over the same period is projected to grow just 16.5pc to total US$204 billion, up from $175 billion in 2015.
Gartner has forecast infrastructure-as-a-service to continue as the strongest-growing segment, projected to grow 38.4 percent globally in 2016.
IaaS in Australia is tipped to grow from A$313 million in 2015 to A$360.5 this year. Cloud advertising is predicted to be the largest money earner.
Gartner research director Sid Nag said the strong IaaS growth reflected enterprises moving away from datacentre build-outs and shifting their infrastructure needs to the public cloud.
Gartner predicts cloud application services to grow globally by 20.3 in 2016, to US$37.7 billion. The Australian market is tipped to reach over A$1.4 billion.