South America Serverless Computing Market Outlook, 2030

The serverless computing market in South America is undergoing a significant transformation, driven by a surge in digital transformation initiatives, increased cloud adoption, and the pressing need for scalable and cost-efficient computing models. Countries like Brazil, Argentina, Chile, and Colombia are leading this regional growth, with Brazil standing out due to its advanced IT infrastructure and vibrant startup ecosystem. The demand for serverless computing is primarily fueled by sectors such as banking, financial services, e-commerce, and media, where rapid deployment, auto-scaling, and pay-as-you-go models offer immense operational advantages.

The COVID-19 pandemic served as a major catalyst, compelling businesses to shift to remote work and online platforms almost overnight, which in turn boosted the demand for flexible, cloud-native technologies like serverless computing. As a result, companies scrambled to develop scalable digital solutions that could handle unpredictable spikes in user activity, especially in healthcare, retail, and logistics. During this period, hyperscale cloud providers such as AWS, Microsoft Azure, and Google Cloud expanded their footprints in South America, with AWS notably investing USD 4 billion in a new cloud region in Chile to meet growing demand. This influx of investment is enabling more businesses to transition from traditional architectures to serverless models, particularly small and medium enterprises that previously lacked access to sophisticated infrastructure. Brazil’s General Data Protection Law (LGPD), modeled closely after Europe’s GDPR, imposes stringent data localization and protection requirements, influencing how and where serverless applications operate. Similar regulations are emerging across Argentina and Chile, requiring serverless providers to ensure compliance with regional data handling laws. Moreover, government policies are increasingly promoting digital modernization, with initiatives aimed at boosting cloud adoption in the public sector.

According to the research report, "South America Serverless Computing Market Outlook, 2030,", the South America Serverless Computing market is anticipated to add to more than USD 1.39 Billion by 2025-30. The primary drivers is the region’s accelerating shift towards cloud-first strategies, especially in economies like Brazil, Chile, Colombia, and Argentina. Brazil, being the largest and most technologically mature market, leads the region with major developments such as the expansion of AWS and Microsoft Azure’s cloud zones. Technological development has also been complemented by evolving government policies.

Countries like Brazil have introduced data protection laws such as the LGPD, pushing cloud providers and companies to build localized data strategies, and this has led to the establishment of region-specific serverless solutions that comply with privacy regulations. Furthermore, governments are increasingly promoting digital transformation programs, offering incentives for cloud adoption and modernization of public sector IT infrastructure. Challenges such as inconsistent regulations across countries and limited technical expertise in some areas have led businesses to opt for hybrid models in South America that combine serverless with traditional infrastructure. Still, increasing cloud literacy, more developer training programs, and partnerships between tech giants and local universities are gradually addressing these gaps. In addition, edge computing is emerging as a complementary trend, with serverless platforms integrating edge capabilities to serve rural and less connected regions, thereby expanding market potential. The region Sustainability is also becoming a focal point, with cloud providers exploring green energy sources for data centers in response to concerns about energy consumption.

Market Drivers

• Growing Digital Transformation and Cloud Initiatives Across Key Countries: Countries like Brazil, Argentina, and Colombia are witnessing a surge in digital transformation, with both public and private sectors investing heavily in modernizing IT infrastructure. As part of this evolution, serverless computing is gaining traction due to its ability to support rapid application development without the need to manage physical or virtual servers. Enterprises are drawn to serverless for its scalability, reduced operational complexity, and cost-effective model, especially in industries such as banking, retail, and telecommunications where demand for agile and customer-facing digital services is rising. The expansion of cloud services in the region by providers like AWS, Microsoft Azure, and Google Cloud has further facilitated the adoption of serverless technologies.
• Cost Sensitivity Driving the Shift to Pay-per-Use Cloud Models: Many South American businesses operate with limited IT budgets and seek technologies that minimize capital expenditure. Serverless computing, with its pay-as-you-go pricing model, aligns perfectly with this need. It allows organizations to scale resources automatically and only pay for actual usage, rather than provisioning for peak loads. This cost-efficiency is especially attractive to startups and SMEs, which form a significant portion of South America’s business ecosystem. By adopting serverless, these companies can innovate faster, deploy modern applications, and avoid upfront investments in infrastructure, making digital solutions more accessible and sustainable.

Market Challenges

• Inconsistent Cloud Infrastructure and Latency Issues: Despite progress, the overall cloud infrastructure across South America remains uneven, with underdeveloped data center networks in some countries leading to higher latency and reduced reliability of serverless applications. In regions lacking local data centers, reliance on cloud infrastructure hosted outside the continent can introduce performance bottlenecks. These challenges are particularly problematic for latency-sensitive applications such as streaming, gaming, and real-time analytics. Limited internet speed and connectivity gaps, especially in rural areas, further compound these issues and slow down widespread adoption of serverless computing.
• Skills Gap and Limited Serverless Awareness Among Developers: A key barrier in the South American market is the lack of skilled professionals familiar with serverless architectures, tools, and best practices. Many IT teams are still accustomed to traditional or monolithic application development models and may resist transitioning to microservices-based, event-driven architectures. Moreover, awareness and educational resources around serverless computing remain limited compared to North America or Europe. This skills shortage affects the speed and quality of serverless adoption, with organizations needing to invest in training, reskilling, and external partnerships to overcome technical hurdles.

Market Trends

• Rising Adoption of Serverless in Fintech and E-commerce Sectors:Fintech and e-commerce are among the fastest-growing digital sectors in South America, particularly in countries like Brazil and Mexico. These industries require scalable, resilient, and cost-effective backend systems to support real-time transactions, dynamic user loads, and seamless digital experiences. Serverless computing is becoming a go-to solution for these companies as it enables rapid deployment of features, elastic scaling, and reduced time-to-market. From digital wallets and online banking to on-demand delivery platforms, serverless is increasingly powering the next generation of consumer-facing applications in the region.
• Integration of Serverless with Edge Computing and IoT Solutions: As smart devices and IoT networks expand across industries like agriculture, manufacturing, and energy in South America, there is a growing trend of integrating serverless computing with edge processing. Serverless platforms are being used to trigger real-time actions, process sensor data, and automate decision-making without requiring constant connectivity to central servers. This is particularly valuable in remote or rural areas where traditional infrastructure is limited. The combination of serverless and edge computing enables low-latency, scalable, and decentralized architectures, which are well-suited for use cases in smart farming, remote monitoring, and predictive maintenance.

The moderate growth of Application Integration services in South America's serverless computing industry is primarily driven by the increasing need for seamless data flow between legacy systems and modern cloud-native applications in digitally transforming enterprises.

The moderate growth of Application Integration services in South America's serverless computing industry reflects the region's evolving digital infrastructure, where businesses are increasingly seeking ways to bridge the gap between traditional systems and emerging cloud-native technologies. As digital transformation gains traction across industries such as banking, retail, healthcare, and logistics, organizations are under pressure to modernize their IT environments without fully discarding legacy infrastructure that still supports critical business operations. This transitional phase has led to a rising demand for integration solutions that enable smooth communication between on-premises applications and cloud-based services.

Application Integration services in serverless architectures offer scalable, event-driven, and low-maintenance solutions to connect APIs, microservices, and data workflows efficiently, which is crucial for organizations aiming to maintain business continuity while embracing innovation. Moreover, the growing adoption of SaaS platforms such as CRM, ERP, and marketing tools in the South American market further necessitates robust integration frameworks to ensure consistent data synchronization and operational efficiency. Governments and large enterprises across countries like Brazil, Argentina, and Colombia are increasingly adopting hybrid cloud strategies, where serverless integration services are essential for orchestrating business processes across multiple environments. However, this growth remains moderate due to certain constraints including skill shortages, limited cloud maturity in some regions, and budgetary limitations among small and medium enterprises. Furthermore, regulatory concerns around data sovereignty and cross-border data flows slow down full-scale cloud adoption, thereby impacting the pace of integration service deployment.

The moderate growth of the Retail & Consumer Goods end-user segment in South America's serverless computing industry is driven by the sector’s gradual digital transformation focused on enhancing customer experience, inventory management, and e-commerce integration, while still contending with infrastructure and budgetary limitations.

The Retail & Consumer Goods sector in South America is experiencing moderate growth in the adoption of serverless computing, as businesses in this domain increasingly recognize the value of digital transformation to remain competitive in an evolving consumer landscape. Retailers are turning to serverless architectures to support a range of digital initiatives, including real-time inventory tracking, personalized customer experiences, mobile applications, dynamic pricing strategies, and seamless omnichannel engagement.

Serverless solutions allow these businesses to process data quickly, scale automatically with demand (such as during peak shopping seasons), and reduce infrastructure costs by only paying for actual compute usage benefits that are especially valuable in cost-sensitive markets. In countries like Brazil, Chile, and Colombia, large and mid-sized retailers are adopting cloud-native and serverless services to support growing e-commerce platforms and improve logistics and supply chain management. Additionally, serverless computing facilitates easier integration with third-party platforms like payment gateways, CRM systems, and delivery apps, helping businesses build more responsive and flexible systems. However, this growth remains moderate rather than explosive due to several region-specific barriers. Many traditional retailers still rely on legacy systems and are hesitant to invest in cloud overhauls due to limited IT budgets, insufficient in-house expertise, and uncertain ROI. Moreover, inconsistent internet connectivity in rural and less developed urban areas, coupled with security and compliance concerns, continue to slow down cloud adoption at scale. Smaller businesses, which make up a significant portion of the retail landscape in South America, often face challenges in accessing the technical skills and financial resources needed to leverage serverless effectively.

The moderate growth of Backend-as-a-Service (BaaS) in South America's serverless computing industry is driven by the rising demand for rapid mobile and web application development among startups and mid-sized businesses, tempered by infrastructure challenges and skill limitations.

Backend-as-a-Service (BaaS) is witnessing moderate growth in South America's serverless computing industry as businesses increasingly seek efficient ways to build, scale, and manage mobile and web applications without the complexity of maintaining backend infrastructure. This trend is particularly evident among startups and mid-sized enterprises that are under pressure to deliver digital solutions quickly to meet the changing expectations of tech-savvy consumers. BaaS offerings providing pre-built backend features such as authentication, databases, cloud storage, push notifications, and API integrations-allow developers to focus more on frontend development and user experience, significantly reducing time-to-market and development costs.

In growing digital economies like Brazil, Argentina, and Chile, where mobile penetration is high and the e-commerce and fintech sectors are expanding, the demand for scalable app solutions is increasing, making BaaS a valuable option. Additionally, BaaS platforms support agile development practices and enable easy scaling during traffic spikes, which is particularly useful in dynamic markets. However, despite these advantages, the growth remains moderate rather than rapid due to several persistent barriers. One major issue is the uneven maturity of cloud infrastructure across the region, where smaller cities and rural areas still lack reliable connectivity and advanced cloud services. Furthermore, many companies continue to rely on monolithic architectures and on-premises systems, making the transition to a fully serverless backend environment slower. There is also a notable shortage of cloud-native development skills, which limits the full utilization of BaaS platforms.

The fastest growth of Large Enterprises in South America's serverless computing industry is fueled by their aggressive digital transformation strategies aimed at enhancing operational efficiency, scalability, and innovation while reducing IT infrastructure costs.

Large enterprises in South America are emerging as the fastest-growing segment in the serverless computing industry due to their strategic commitment to digital transformation and the increasing demand for scalable, cost-efficient, and agile IT infrastructures. These organizations, spanning industries such as banking, telecommunications, retail, manufacturing, and energy, are under mounting pressure to modernize their operations to remain competitive in both domestic and global markets. Serverless computing offers these enterprises an attractive alternative to traditional monolithic systems by eliminating the need to manage servers, allowing them to focus on innovation, service delivery, and user experience.

By adopting Function-as-a-Service (FaaS) and Backend-as-a-Service (BaaS) models, large enterprises can quickly scale resources according to demand, improve application performance, and significantly reduce operational costs related to infrastructure management and maintenance. Moreover, serverless computing supports continuous deployment and real-time analytics, enabling businesses to be more agile and responsive to market changes. Countries like Brazil, Chile, and Colombia are witnessing a surge in large-scale digital transformation projects, often supported by partnerships with global cloud service providers like AWS, Microsoft Azure, and Google Cloud, who are expanding their regional presence with local data centers and tailored compliance solutions. This local investment boosts confidence among large enterprises to adopt serverless technologies at scale, particularly for mission-critical applications in customer service, finance, and logistics. Additionally, these companies typically have greater access to skilled IT professionals and larger budgets, allowing them to experiment with and implement cutting-edge cloud-native technologies. However, despite the rapid growth, challenges such as compliance with data localization laws, integration with legacy systems, and cybersecurity concerns still exist.

The moderate growth of Private Cloud in South America's serverless computing industry is driven by the need for greater data control, security, and compliance in regulated sectors, despite higher costs and infrastructure complexity compared to public cloud alternatives.

Private Cloud is experiencing moderate growth in South America's serverless computing industry as enterprises in highly regulated sectors increasingly prioritize data security, governance, and compliance factors that are often better addressed through private infrastructure models. Industries such as finance, healthcare, energy, and government require strict control over sensitive data, and private cloud environments provide a more secure and customizable solution than public cloud options.

In countries like Brazil, Argentina, and Chile, regulations surrounding data localization, industry-specific compliance standards, and cybersecurity have led large enterprises and institutions to adopt private cloud frameworks that allow them to host serverless applications within isolated and dedicated environments. This setup enables organizations to take advantage of serverless computing benefits-like dynamic scaling, reduced infrastructure management, and operational efficiency-while maintaining full control over data flow, system access, and configuration. However, the adoption remains moderate due to the cost-intensive nature of private cloud infrastructure, which includes hardware investment, on-premises data center maintenance, and the need for specialized IT personnel. These challenges are particularly significant for small and medium-sized enterprises (SMEs), which often cannot afford the financial and technical demands of private cloud environments. Furthermore, private cloud deployments can lack the elasticity and global reach of public cloud services, limiting their appeal for certain serverless applications that require rapid scaling or integration with third-party cloud services. Major cloud providers and regional data center operators are also investing in localized private cloud solutions tailored to South American compliance and performance needs, further contributing to the sector’s steady but measured growth.

Brazil is leading in the South America serverless computing industry due to its expanding digital economy, increasing cloud adoption, and strong presence of global and regional cloud service providers.

Brazil’s leadership in the South America serverless computing industry can be attributed to the rapid expansion of its digital economy, growing demand for scalable cloud-native solutions, and the robust presence of both global and regional cloud service providers establishing infrastructure and services in the country. As the largest economy in South America, Brazil has become a hotspot for digital transformation, with enterprises across sectors such as finance, retail, healthcare, agriculture, and logistics increasingly adopting serverless computing to meet dynamic business needs.

The growth of the Brazilian e-commerce market, digital banking platforms like Nubank, and mobile applications catering to millions of users has driven organizations to seek flexible backend solutions that can scale in real-time without the complexity of server management. Serverless computing offers a cost-effective and efficient model that enables these businesses to reduce operational overhead, speed up deployment cycles, and adapt quickly to user demand. Global cloud giants like AWS, Microsoft Azure, and Google Cloud have significantly expanded their presence in Brazil, setting up local data centers and offering localized serverless solutions such as AWS Lambda, Azure Functions, and Google Cloud Functions. These platforms provide the foundation for developers and enterprises to build and scale applications rapidly, while complying with Brazilian data protection regulations, such as the Lei Geral de Proteção de Dados (LGPD). Additionally, domestic cloud and IT service providers are also enhancing their serverless offerings to address local market nuances and support the needs of small and medium-sized businesses (SMEs).