Latin America has spent a decade trailing other regions in cloud maturity. It is now growing faster than the global market — and the constraint on that growth is no longer whether enterprises trust the cloud, but which workloads they are willing to put on it.
Frost & Sullivan’s latest research, Frost Radar™: Infrastructure- and Platform-as-a-Service Providers in Latin America, 2026, finds the regional IaaS-PaaS market growing 15% in 2025 to an estimated USD 14 billion, with a 22.4% CAGR from 2024 to 2031 — ahead of the global market’s 21.2%. The region still represents only 4.5% of global IaaS-PaaS spending. That is the measure of how much room is left.
Demand Is Not the Issue — Trust Is
Seventy-eight percent of Latin American IT leaders consider cloud necessary to compete. Yet 62% still reserve public cloud for less sensitive operations and 61% cite data security as a major challenge. That gap is being filled by hybrid and hosted private architectures: 61% of regional respondents now use hosted private cloud, a 21-point jump in a single year.
Enterprises are leaving on-premises infrastructure decisively — but they are consolidating with one trusted provider rather than splitting workloads across several.
Three Hyperscalers Control 81.9% of the Market
The competitive picture reflects that consolidation. AWS, Microsoft Azure, and Google Cloud control 81.9% of the Latin American market, with AWS leading at 39.9% and Azure at 26%.
Infrastructure commitments are the differentiator:
- AWS has pledged USD 5 billion over 15 years in Mexico, USD 4 billion in Chile, and roughly USD 1.8 billion in Brazil through 2034, with Local Zones in Querétaro, Santiago, Buenos Aires, and Lima — and Rio de Janeiro and Bogotá in development.
- Azure launched cloud regions in Mexico in 2024 and Chile in 2025.
- Google Cloud opened in Querétaro and is investing in Uruguay, while Huawei expands in Peru.
Regulatory Fragmentation Remains the Structural Brake
Each country is building its own data sovereignty framework — most modeled on GDPR — with Brazil’s LGPD and its residency requirements setting the regional benchmark. The patchwork raises compliance costs and blocks a unified digital market, compounded by tariff pressure and the wider US-China technology rivalry that regional policy has not answered with a common position.
“The center of gravity in Latin American cloud has moved past São Paulo and Querétaro, and the providers that recognize it first will take the region’s next decade. Bogotá, Buenos Aires, Montevideo, and Lima are generating demand that current infrastructure cannot serve — and the untapped base is not the large enterprise, it is the SME that still cannot make the economics work.” — Ignacio Perrone, Growth Expert, Frost & Sullivan
Read the Full Analysis
For more insights into the Latin American IaaS-PaaS market, competitive positioning, and Frost & Sullivan’s benchmarking of provider growth and innovation, click here to access the research.
