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The 2025 ISG Provider Lens® Private/Hybrid Cloud — Data Center Services report for Brazil, published by Information Services Group (ISG) (Nasdaq: III), highlights a surge in demand for hybrid cloud services as Brazilian enterprises optimize infrastructure for generative AI (GenAI), cost efficiency, security, and performance. The report notes a trend of “repatriating” workloads from public clouds to hybrid and colocation solutions to balance costs and computing demands.
Hybrid Cloud Surge: Brazilian firms shift from public clouds to hybrid architectures for AI, cost savings, and security.
GenAI Cost Challenges: Public clouds are cost-prohibitive for full-scale GenAI; hybrid solutions reduce ownership costs.
Key Providers: Edge UOL, Equinix, Kyndryl, and T-Systems lead in three quadrants; Accenture, Capgemini, others in two.
Market Drivers: Need for low-latency connections, secure data transfer, and AI-ready infrastructure.
Colocation Growth: Expansion across Latin America to support GPU hosting for AI and LLMs.
Cost Optimization: Hybrid setups save 20–30% on AI workloads compared to public clouds, per ISG estimates.
The report highlights Brazilian enterprises diversifying infrastructure to balance efficiency, speed, and security. Public clouds, while used for GenAI proofs of concept, are often too expensive for full-scale deployments, prompting a shift to hybrid architectures. “As enterprises learn the strengths and limitations of public clouds for AI, there is growing interest in other options,” said Anay Nawathe, ISG cloud delivery lead for the Americas. Hybrid setups allow workload migration to cost-effective platforms, with 20–30% savings on AI workloads compared to public clouds, based on ISG’s analysis.
Managed hosting providers are enabling consistent environments across workloads, integrating private clouds and colocation services. The colocation market in Brazil and Latin America is expanding to host GPU-intensive AI tasks, driven by digital service demands. Providers like Ascenty and Scala Data Centers are building low-latency SDN connections to bridge Brazil’s vast geographic distances.
Growing interest in GenAI is accelerating hybrid cloud adoption due to its high computing and connectivity needs. Brazilian firms struggle to estimate large language model (LLM) costs and lack tools to manage resource consumption. “Enterprises want GenAI to both increase revenue and reduce costs,” said Pedro L. Bicudo Maschio, lead report author. Hybrid architectures minimize total cost of ownership while ensuring data privacy, with providers offering infrastructure-as-code and SDN for secure, low-latency data transfers.
The ISG report evaluates 50 providers across five quadrants: Managed Services — Large Accounts, Managed Services — Midmarket, Managed Hosting, Colocation Services, and AI-Ready Infrastructure Consulting. Leaders include:
Three Quadrants: Edge UOL, Equinix, Kyndryl, T-Systems.
Two Quadrants: Accenture, Capgemini, Dedalus, EVEO, SBA Edge, TIVIT, Wipro.
One Quadrant: Ascenty, Elea Data Centers, HostDime, inov.TI, MadeinWeb, ODATA, Scala Data Centers, Skynova, Stefanini, Takoda, Under.
Rising Stars: Atos, Central Server (one quadrant each).
The global hybrid cloud market is projected to reach $145B by 2027 (Statista, 2025), with Brazil’s market driven by banking and agribusiness. The 2024 ISG Microsoft Cloud Ecosystem report noted Microsoft’s Azure expansion in Brazil, supporting GenAI via OpenAI Studio. Google Cloud’s Anthos is also widely used for multicloud orchestration. These trends align with a 37% CAGR in AI infrastructure spending in Latin America through 2029, per IDC.
ISG is a global AI-centered technology research and advisory firm. A trusted partner to more than 900 clients, including 75 of the world’s top 100 enterprises, ISG is a long-time leader in technology and business services that is now at the forefront of leveraging AI to help organizations achieve operational excellence and faster growth. The firm, founded in 2006, is known for its proprietary market data, in-depth knowledge of provider ecosystems, and the expertise of its 1,600 professionals worldwide working together to help clients maximize the value of their technology investments.
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