The findings, published by Canalys and Synergy Research Group, showed that growth was driven by hybrid and remote work as well as the growing use of industry-specific cloud applications. And while these latest figures reinforced the 35% annual growth Canalys and Synergy Research Group reported for Q1, the party could soon be coming to an end as data centre component providers see longer lead times and higher prices that will inevitably be passed on to the largest providers.
“Overall compute demand is out-growing chip manufacturing capabilities, and infrastructure expansion may become limited for the cloud service providers,” said Canalys research analyst Blake Murray.
The global semiconductor shortage has impacted the automotive industry throughout this year. Canalys reported last month that smartphone sales are down 6% due to the shortage and Dell’Oro Group has said data centre switches are also facing supply issues.
Murray continued: “Besides managing supply chains to the best of their abilities, the providers building an advantage are focused on developing their go-to-market channels along with their product portfolios to catch up with an increasingly wide variety of customer use cases that has fueled demand since the start of the pandemic.”
Major players
The latest figures from Canalys shows that expenditure increased $12.9 billion when compared to Q3 last year, and $2.4 billion compared to last quarter.
With little surprise, this was driven by AWS, which accounted for 32% of total services spend in the quarter; Microsoft Azure, with a 21% market share; and Google Cloud, which accounts for 8% of the market.
All three have continued to release new cloud-based products and services this year.
AWS recently announced AWS for Health and it has won new contracts with the US and UK governments. Meanwhile, Azure expanded capabilities in financial services and manufacturing and reported new customers in its cloud service suites for healthcare and sustainability. Azure Purview, a unified data solution designed to support data management in multi-cloud environments, was also announced.
Over at Google Cloud – which although taking the smallest market share of the majors saw growth of 54% – the big news was the launch of Google Distributed Cloud, which gives customers options to extend Google Cloud’s infrastructure to the edge and customer data centres. Google Cloud advertised a 175% increase in customer engagements through partners during the first half of 2021
For its research Canalys defined cloud infrastructure services as those that provide infrastructure as a service and platform as a service, either on dedicated hosted private infrastructure or shared infrastructure. This excludes software as a service expenditure directly, but includes revenue generated from the infrastructure services being consumed to host and operate them.
Data published by Synergy Research Group last month assessed the growth in cloud infrastructure services, comprising IaaS, PaaS and hosted private cloud. Those insights concluded revenues from cloud services and infrastructure increased 25% for operators and vendors in the first half of the year, reaching $235 billion. That data also showed cloud provider spending on colocation, leasing and data centre construction grew by 17%.
