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28 July 2017
| Natalie Bannerman
According to Q2 2017 results, the cloud infrastructure market grew by 47% YoY, reaching a total of $14 billion.
Overall the top four cloud service providers represented 55%
of the entire cloud infrastructure services market, according
to analysis by Canalys.
In order these are: Amazon Web Services (AWS) at the top,
growing 42% YoY and accounting for 30% of the total spend,
although it grew at slower rate than two of its competitors.
Second came Microsoft with 97% growth; third was Google with a
92% growth rate, and lastly IBM which grew at a rate of 23%,
the only one of AWS’s rivals to be beaten in terms
Demand for primary cloud infrastructure services, such as
on-demand computing and storage, are the main drivers for this
growth, said Canalys. But future growth will be fuelled by the
AI platforms that cloud service providers are building to
develop new applications, processes, services and user
AWS for example has established an AI service that focuses
on understanding language, speech recognition, visual search,
text-to-speech conversion and machine learning technologies.
"It continues to strengthen its AI capabilities, with increased
accuracy in speech recognition, as well as offering Volta
GPU-powered virtual instances in its EC2 to expand its
deep-learning capabilities," said Daniel Liu, research analyst
Meanwhile, "Microsoft is focusing more on machine reading,
which will enable automatic understanding of text. It acquired
Maluuba, a deep-learning start-up, in January this year as it
sees AI as a strategic part of the company’s
future growth," added Liu.
Google has also announced its own AI chip called the Cloud
TPU, which is used to run Google’s AI services.
Although the chip won’t be sold, exclusive access
through a dedicated cloud service will be available and is set
to launch at the end of this year. "AI is still in an early
stage of development and not delivering significant revenue
yet, but it offers tremendous potential, with demand for
AI-related workloads expected to fuel cloud services growth,"
Watson is the AI that IBM is backing to drive future
growth for the company, with application programming interfaces
(APIs) like conversation, discovery and visual recognition, it
is already being used in security intelligence and contact
"Leading chipset providers also gained traction, with
Nvidia’s datacenter GPU business growing
nearly 300%. AMD’s partnerships with Microsoft,
Google and Baidu to provide graphics processors for their AI
businesses signifies cloud service providers’
growing investment in hyper-scale hardware with AI-focused
capabilities. This investment will continue to drive customer
spend on cloud services," said Liu.
The latest figures align with forecast data, recently released by Synergy
Research Group indicating that cloud and SaaS global
revenue will pass the $200 billion milestone in 2020.
Amazon Web Services,