Web Hosting Services Market 2020 and Forecast 2021-2027

                                          
Report Overview: Global Web Hosting Services Market


The global web hosting services market size was valued at USD 45.6 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 14.4% from 2021 to 2027. Web hosting services can be categorized into various types such as shared, colocation, dedicated, and Virtual Private Server (VPS). The service allows enterprises and individuals to leverage a website over the internet to publish their business-related as well as personalized content. A growing number of organizations across the globe are anticipated to bolster the market growth over the forecast period 2021-2027. These organizations publish their websites over the internet to increase their online presence as well as for marketing purposes.


Over the past few years, the number of startups companies across the globe is growing at a rapid rate. Governments of various developing and developed nations are providing financial and non-financial support for the small business entrepreneurs to help them grow their businesses. For instance, the U.S. federal government provides various funding programs such as Women-Owned Small Businesses (WOSB) Federal Contracting and USDA Rural Business Enterprise Grant Program to small business owners. Such government initiatives have motivated more entrepreneurs to start new businesses in the country. Moreover, to sustain their businesses in a highly competitive environment, these entrepreneurs seek an omnichannel sales model. The omnichannel sales model enables them to maximize the extent of their customer base by offering their entire product portfolios through the internet globally. Therefore, the growth of such small businesses is expected to increase market growth.

The growth in the business activities of the organizations boosts the growth of the market for web hosting services. As the business grows, the company websites start getting more traffic. It becomes difficult to handle the increased traffic if the company is using a shared server. Therefore, to suffice the requirement of the increased traffic, the company has to switch to some other type of hosting such as dedicated or colocation. However, the company can also choose any different kind of hosting service that it deems fit for the organization and their workloads.

The low availability of funds coupled with the growing safety and security requirements of the large and small companies has resulted in the switch to cloud-based solutions or services. The advantages of cloud hosting, including the low infrastructure cost and increased uptime, has resulted in an increased inclination towards cloud hosting. Additionally, website hosting service providers offer three kinds of cloud hosting services, including public cloud, private cloud, and hybrid cloud. All of these cloud solutions offer varied benefits; however, the hybrid cloud services are becoming the most opted option among the end users.

Furthermore, the outbreak of the COVID-19 pandemic has resulted in increased internet activity. Most of the businesses have started to leverage internet services for conducting business operations. Additionally, the outbreak has made individuals spend more time over the internet for writing blogs, making fitness videos, among other activities, and posting them over the internet. Moreover, the growing inclination towards online purchasing, as an outcome of the pandemic, will encourage increased investments by end users developing a robust IT infrastructure and business models. Besides, several market players are actively taking initiatives to provide support to small businesses during this unprecedented time. For instance, GoDaddy Operating Company, LLC is giving temporary free access to the company’s several tools including marketing tools, social media designing using smartphones, and educating the users about websites and digital marketing.
 Type Insights

In terms of revenue, the shared hosting segment lead the market with a revenue share of 37.64% in 2019. This high share is attributed to the high adoption rate of shared hosting servers, especially among the small and medium enterprises. Most of the small and medium businesses prefer this type of hosting owing to the low website traffic that they receive. Additionally, these SMEs are present in large numbers across every region and represent more than 90% share out of the total number of businesses. Although the cost associated with shared hosting is lower as compared to any other type of hosting, however, a large number of SMEs, as well as individuals, are opting for shared hosting. Therefore, this segment holds the highest share in the market.

As the businesses grow and companies start to get more web traffic, they opt to shift from shared hosting to different other types of hosting services, including VPS, dedicated, or cloud hosting, among others. Large organizations generally opt dedicated hosting as they need to cater to a very high amount of web traffic. Another reason for opting dedicated hosting is the budget availability as the cost associated with it is quite high. Due to budget constraints, small or medium organizations find it challenging to choose dedicated servers for their business requirements. However, the high levels of security and uptime that dedicated hosting offers is expected to contribute to the decent growth rate of the segment.

Application Insights: Global Web Hosting Services Market

In terms of revenue, the public website segment lead the web hosting services market with a share of 52.48% in 2019. This high share is attributed to the fact that most of the websites are accessible to everyone across the globe. Therefore, companies prefer to host their websites in a way that they can target a huge chunk of the general population in order to sell their products or solutions. However, companies also use intranet websites that are widely preferred for their internal employees. Some of the examples of intranet websites include huddle, Microsoft SharePoint, Jostle, and Igloo.

Nowadays, the internet penetration rate and use of smartphones are increasing rapidly across the globe. This has resulted in a rapid shift in consumer buying patterns as they prefer to buy products or services online and get them delivered at their doorsteps. Therefore, companies especially engaged in e-commerce businesses have started to widen their sales channel by providing the products through mobile applications. This helps the e-commerce companies provide their customers easy access to their online stores through using their cellphones. As a result, it is anticipated to see the modest growth of this segment in near future.

Deployment Insights: Global Web Hosting Services Market

In terms of revenue, the public segment lead the market with a share of 43.84% in 2019. This high share can be attributed to the benefits such as low cost as well as high scalability that public cloud offers. Due to these benefits, the small and medium sized businesses choose this type of services to host their websites. Moreover, the public segment primarily includes shared web hosting and public cloud hosting services.

The hybrid segment is expected to witness the highest CAGR over the forecast period. The high growth can be attributed to the advantages that hybrid cloud offers in comparison with the public and private cloud. Hybrid cloud provides a higher level of security as well as uptime when compared with the public cloud. Also, the cost associated with the hybrid cloud is lower than the price of a private cloud. Additionally, companies all over the globe are increasingly inclined towards opting hybrid cloud hosting services as it allows them to leverage the flexibility that cloud offers. This includes connecting the on-premise private cloud and third-party, public cloud into one single and flexible infrastructure. This infrastructure allows the organization to select an optimal cloud platform for each workload and application. It also allows switching of workloads between the public and private cloud.

End-user Insights: Global Web Hosting Services Market

In terms of revenue, the enterprise segment lead the market with a share of 90.46% in 2019. This high share can be attributed to the increasing focus of enterprises on expanding their business presence through online channels. The significantly growing customer preference for online shopping is the primary factor creating vast opportunities for these businesses to focus on online channels. Therefore, the growing customer’s inclination towards online purchasing is expected to bolster the market for web hosted services from 2020 to 2027.

Large enterprises have maximum adoption of website hosting services to manage their large business operations. These enterprises, although fewer in number as compared to SMEs, occupy considerable share in the market. Also, these businesses usually opt for a premium and highly secured web hosting plan such as dedicated hosting, which aids in managing the organizations’ huge online traffic. Besides, most of the e-commerce websites also prefer dedicated hosting services due to deliver enhanced security to their websites.

Regional Insights: Global Web Hosting Services Market

North America lead the market with a revenue share of 35.28% in 2019. This high share can be attributed to the U.S. market, which has the greatest number of websites available on the internet. Besides, several key market players including Amazon Web Services, Google, LLC, and GoDaddy Operating Company, LLC, have a significant presence in the regional market.

Europe is anticipated to witness a CAGR of more than 15% from 2021 to 2027. Countries such as Germany and the U.K. are contributing to the high growth rate in this region. Out of the total websites/domains hosted online as of 2018, Germany had a total of more than 7 million domains. Additionally, the European government is investing in building a more secure and reliable IT infrastructure following the ransomware cyberattack WannaCry, in May 2017. The growing investments in developing the IT infrastructure by the governments of various developed and developing nations is also contributing to the market growth. Further, the growing digitalization and demand for online delivery websites, are the factors anticipated to spur the market growth.

Key Companies & Market Share Insights: Global Web Hosting Services Market

Key players provide hosting services to a large number of companies to publish their websites online. Additionally, these players are focusing to increase their market shares by adopting strategies that include investments, new product & service launches, partnerships, and mergers and acquisitions. For instance, in September 2019, GoDaddy Operating Company, LLC announced the launch of the company’s new websites and marketing service. This new service is designed to be the one-stop solution for companies where they can create their website and also market it. Some of the prominent players in the global web hosting services market include:

Key companies Profiled: Global Web Hosting Services Market Report

 	
Amazon Web Services, Inc.
 	
 Endurance International Group
 	
1&1 IONOS Inc.
 	
Liquid Web, LLC
 	
GoDaddy Operating Company, LLC
 	
Google LLC
 	
Hetzner Online GmbH
 	
Alibaba Cloud
 	
Equinix, Inc.
 	
WPEngine, Inc.

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Trusted Business Insights has segmented the global web hosting services market report on the basis of type, application, deployment, end user, and region:

Type Outlook (Revenue, USD Million, 2016 - 2027)

 	
Shared Hosting
 	
Dedicated Hosting
 	
Virtual Private Server (VPS) Hosting
 	
Colocation Hosting
 	
Others

Application Outlook (Revenue, USD Million, 2016 - 2027)

 	
Intranet Website
 	
Public Website
 	
Mobile Application

Deployment Outlook (Revenue, USD Million, 2016 - 2027)

 	
Public
 	
Private
 	
Hybrid

End-user Outlook (Revenue, USD Million, 2016 - 2027)

 	
Enterprise
 	
SMEs
 	
Large Enterprises
 	
Individual