Tuesday, 30 July 2019 12:31

Amazon beats out Microsoft to retain top rank in global IaaS market: report Featured

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Amazon is once again the number one vendor in the global infrastructure as a service market, with the worldwide IaaS market growing 31.3% in 2018 to total US$32.4 billion, up from US$24.7 billion in 2017.

And Amazon remained in the No 1 spot followed by Microsoft, Alibaba, Google and IBM, according to the latest IaaS market report from Gartner.Amazon leads the IaaS market with an estimated $15.5 billion of revenue in 2018, up 27% percent from 2017.

As the largest of the IaaS providers, Amazon accounts for nearly half of the total IaaS market and Gartner says the company continues to aggressively expand into new IT markets via new services, as well as acquisitions, growing its core cloud business.

Microsoft secured the No. 2 position in the IaaS market with revenue surpassing $5 billion in 2018, up from $3.1 billion in 2017, as the company delivers its IaaS capabilities through its “innovative and open Microsoft Azure offering, which continues to solidify its position as a leading IaaS provider”.



And, according to the report from Gartner, in 2018, the top five IaaS providers accounted for nearly 77% of the global IaaS market, up from less than 73% in 2017.

The dominant IaaS provider in China, Alibaba Cloud, experienced the strongest growth among the leading vendors, growing 92.6% in 2018.

Gartner says the company has built an ecosystem consisting of managed service providers (MSPs) and independent software vendors (ISVs), and its success last year was driven by aggressive R&D investment in its portfolio of offerings, especially compared with its hyperscale provider counterparts.

And Gartner says Alibaba has the financial capability to continue this trend and invest in global expansion.

Search engine giant Google came in at the No. 4 spot, growing 60.2% in revenue from 2017.

“Google’s cloud offering is something to keep an eye on with its new leadership focus on customers and shift toward becoming a more enterprise-geared offering,” said Sid Nag, research vice president at Gartner.

Gartner forecasts that market consolidation will continue through 2019, driven by the high rate of growth for the top providers, which experienced aggregate growth of 39% from 2017 to 2018 compared with the more modest growth of 11% for all other providers during the same period.

“Despite strong growth across the board, the cloud market’s consolidation favours the large and dominant providers, with smaller and niche providers losing share,” Nag said.

“This is an indication that scalability matters when it comes to the public cloud IaaS business. Only those providers who invest capital expenditure in building out data centres at scale across multiple regions will succeed and continue to capture market share. Offering rich feature functionality across the cloud technology stack will be the ticket to success, as well.”

And Nag also says that, “consolidation will occur as organisations and developers look for standardised, broadly supported platforms for developing and hosting cloud applications.”

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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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