Cloud infrastructure service spending grows by 40% year on year
Second quarter spend on cloud infrastructure services increased to 39% from the second quarter of 2018, according to new figures from Synergy Research Group.
The new figure is slowing reducing each quarter, in line with expectations, reflecting the increasingly large scale of the market. In dollars, however, the market grew by over $1.6 billion from the previous quarter, making it the second highest incremental increase ever achieved.
“Revenues from cloud infrastructure services have almost hit the $100 billion per year run rate, and there is no end in sight to strong growth,” said John Dinsdale, a chief analyst at Synergy Research Group. “When quarterly spend on cloud services is mapped out for the last twelve quarters, we are pretty much looking at a steep, straight line growth profile.”
Amazon’s growth kept pace with the market and it maintained its 33% worldwide market share. Following them, a group of four cloud providers continues to outpace the market and to grow their market share – Microsoft, Google, Alibaba and Tencent. However, in total, Amazon is still bigger than those four combined. Shortly behind are another four cloud providers are market leaders but their growth rates are lower and they are more niche oriented – IBM, Salesforce, Oracle and Rackspace.
“Amazon is maintaining its leadership position in the market though growth at Microsoft is also noteworthy. In early 2016 Microsoft was less than a quarter the size of Amazon in this market, while today it is getting close to being half the size. These two cloud providers alone account for half of all money spent on cloud infrastructure services, which is impressive for such a high-growth, strategically important market,” continued Dinsdale.
As most of the major cloud providers have recently released their earnings data for Q2, Synergy estimates that quarterly cloud infrastructure service revenues - including IaaS, PaaS and hosted private cloud services - were almost $23 billion, with revenues for the last four quarters now reaching well over $80 billion.
Public IaaS and PaaS services account for the bulk of the market and those grew by 42% in Q2. In public cloud, the dominance of the top five providers is even more pronounced, as they control over three quarters of the market. Geographically, the cloud market continues to grow strongly in all regions of the world.