Spending on cloud computing in global financial services will grow from $4 billion in 2010 to more than $27 billion by the end of 2015, a compound annual growth rate (CAGR) of nearly 47%, according to a new report released by research consultancy TowerGroup.

Yet despite rapid growth, cloud-based services will represent only about 6% of IT spending by2015 due to challenges of changing delivery models, the need to recover sunk costs, regulation, and reticence. In its latest report, “Destination 2015: Spending on Cloud Computing in Financial Services," Rodney Nelsestuen, senior research director in TowerGroup’s financial services practice, notes that, for a number of reasons, cloud computing for insurers and other financial services firms is here to stay.

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