Public cloud infrastructure revenue tops $11bn in Q1 of 2018

18 June 2018 | Natalie Bannerman

Public cloud provider spending on infrastructure hardware and software, grew by 32% from Q1 2017 to revenues of $11 billion in the first quarter of 2018.

CIE Q118

According to figures from Synergy Research Group this is the highest growth figure seen in nine quarters when typically grow is in the 10-20% range.

"As we saw in our analysis of Q1 hyperscale capex, the hyperscale operators are on a spending spree and continue to crank up their investment in data centres, with much of this spending flowing through to the vendors of data centre hardware and software," said John Dinsdale, a chief analyst and research director at Synergy Research Group.

Figures for the period usually experienced a sharp drop off after a seasonally strong fourth quarter, by numbers show only a drop of 2% from Q4. As for the vendor market share, ODMs continue to dominate the market and accounts for almost 30% of total market revenues.

They are followed by Dell EMC, Cisco and HPE which each have a 5-10% market share. This is compared to Q1 where Microsoft, Huawei and VMware were ranked as the highest vendors.

"Hyperscale operators totally dominate the cloud market, so their ongoing growth bodes well for hardware and software vendors – though ODMs continue to aggressively increase their share of the pie. Our forecasts show that IaaS, PaaS, SaaS and public cloud workloads generally are all going to continue to grow rapidly over the next five years, which will continue to drive ever-increasing levels of spending on data centre infrastructure," added Dinsdale.

As for total public cloud infrastructure revenues including hardware and software reached over $11 billion. 95% of the Q1 public cloud infrastructure market is comprised of servers, OS, storage, networking and virtualisation software, with the balance made up of cloud security and cloud management.

By segment, ODMs lead server and storage hardware shipments, followed by Dell EMC, HPE and Cisco. Cisco has a clear lead in networking, despite the continued strong growth of Arista. Microsoft and VMware are leaders in the infrastructure software segments.

Topics: Synergy Research Group, Cloud, Infrastructure, John Dinsdale, data centre, Microsoft, Huawei, VMware, Dell EMC