Cloud Spending by Small Businesses Expected to Double by 2027
According to a new report from Gartner, small business spending on cloud services is expected to reach $280 billion by 2027 — nearly double the $150 billion spent in 2025. The shift reflects a fundamental change in how smaller organizations approach their IT infrastructure.
What's Driving the Migration
Several factors are accelerating cloud adoption among SMBs:
- Remote and Hybrid Work — Cloud tools are essential for distributed teams, even as some workers return to offices.
- AI Integration — Many new AI tools require cloud infrastructure to function, pushing businesses to modernize.
- Cost Predictability — Subscription-based cloud services offer predictable monthly costs versus unpredictable hardware failures.
- Disaster Recovery — Recent Gulf Coast hurricanes have highlighted the importance of off-site data storage and business continuity.
Where Businesses Are Investing
The fastest-growing cloud categories for small businesses are:
- Cloud Backup and Disaster Recovery — up 45% year-over-year
- Cloud-Based Security Tools — up 38%
- Collaboration Platforms (Teams, Google Workspace) — up 32%
- Cloud ERP and Accounting — up 28%
- Cloud Phone Systems — up 25%
Making the Transition Smart
The key to a successful cloud migration is having a clear strategy. Businesses that rush to the cloud without proper planning often end up with higher costs, security gaps, and frustrated employees. A phased approach — starting with email and backup, then expanding to line-of-business applications — typically delivers the best results.
WITTCO specializes in helping Gulf Coast businesses plan and execute cloud migrations that align with their budget and business goals.
