The worldwide public cloud services market will break through the $200 billion (€185b) barrier this year, a new report has claimed.

Gartner is forecasting the market will grow 16.5 percent in 2016, which is more than than the 13.7 percent growth recorded in 2015, to reach $203.9 billion.

Cloud system infrastructure services (IaaS) will be the biggest driver of growth, rising 38.4 percent.

Cloud management and security services, cloud application infrastructure services (PaaS) and cloud application services (SaaS) will all see growth of over 20 percent.

However, growth in the largest sub-segment of the market, cloud advertising, will begin to decline.

Sid Nag, Research Director at Gartner, said enterprises moving away from data centre build-outs would push IaaS to become the strongest-growing segment.

He advised providers to focus on creating differentiation for success.

Earlier this month, BT Global Services revealed it was one of five providers competing for the European Commission’s public cloud projects.

In December, Deutsche Telekom launched its public cloud offering for enterprises in Europe as it looks to compete with Amazon and Google.

[Read more: Telcos must do more in bid to provide cloud services to SMEs]

Nag said: "The market for public cloud services is continuing to demonstrate high rates of growth across all markets.

"This strong growth continues reflect a shift away from legacy IT services to cloud-based services, due to increased trend of organisations pursuing a digital business strategy."

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