AWS Slow to Yield Ground to Fast-Growing Competitors, according to a report
According to new data from Synergy Research Group, Amazon Web Services Inc. (AWS), has a 31 percent global market share in the cloud infrastructure market. This is a significant advantage over its competitors, who are enjoying growth rates well above 100 percent.
The research firm stated that the market was dominated by Microsoft, IBM, and Google. However, the next 20 cloud providers accounted to 27 percent. “The good news is that Microsoft and Google both experienced growth rates well above 100 percent, so they are slowly gaining ground on the market leader.”
However, things are not looking so bright for those who want to seize a piece of the lucrative cloud pie.
Synergy stated that, “Outside the big four, 20 cloud providers are growing on average 41 percent per annum, but in a marketplace that is growing at more than 50 percent that means most of them are losing marketshare.”
According to Q1 data, the lucrative cloud pie is also increasing. Synergy stated that most major cloud operators have released their Q1 earnings data. This means that quarterly cloud infrastructure service revenue (including IaaS/PaaS and private/hybrid cloud) has comfortably passed the $7 billion mark.
Amazon, the parent company, announced last week its quarterly financial results. This was due to the AWS cloud unit. According to this report, AWS raked in $2.57 trillion in revenue for the quarter ended March 31. This is in line with Wall Street estimates. This is a 64 percent increase over the year-ago period, and 7 percent more than the previous quarter. AWS is on track to meet the $10 billion run rate that Amazon.com CEO Jeff Bezos predicted in a letter to shareholders earlier in the month.
Synergy stated that the U.S. still holds the largest share of the global market.
John Dinsdale, an executive, said that this market is so large and is growing so quickly that companies can grow by 10-30% per year and feel good about it. Yet they would still be losing market share. “The big question is whether they are building a sustainable, profitable business. You can focus on specific areas or services but the vast majority of the market requires huge scale, deep pockets, and a long-term corporate focus.