AWS Public Cloud Dominance Continues – Report

Scott Ferguson

The astronomical growth at Amazon Web Services appears to have slowed in the last few months, but the company remains in a class by itself in the public cloud market, and far ahead of all its competition combined, according to a new report.

In the first quarter of 2017, Microsoft, Google, IBM, Alibaba and Oracle all grew much faster than AWS, but Amazon's public cloud platform still controls 33% of the market and is bigger than all those other players put together, according to an April 27 report by Synergy Research Group.

The report comes on the same day that Amazon reported its first-quarter financial numbers for 2017. In that report, the company announced AWS grew 43% over the previous quarter, pulling in $3.66 billion in sales. That is slower growth compared to past quarters, but enough to still impress industry analysts and Wall Street. (See AWS Sales Still Impress Even With Small Slowdown.)

Despite the small slowdown, AWS remained the global leader in public infrastructure-as-a-service (IaaS), as well as platform-as-a-service (PaaS) in the first quarter of 2017, according to Synergy.

"At the top end of the cloud provider market we're now seeing a clear stratification featuring AWS, a group of higher-growth chasers, and a couple of more focused niche players," John Dinsdale, chief analyst and research director at Synergy, wrote in a statement.

During the first quarter, worldwide revenue from IaaS, PaaS and other hosted private cloud services totaled $10 billion, and continues to grow at more than 40% annually.

While AWS dominates in terms of market share and revenue, the other major public cloud players continue to grow as well. Microsoft, Google and Alibaba all posted annual growth rates of 80% or more. Oracle and IBM continued to grow as well during the quarter.

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In the public cloud, AWS, Microsoft and Google are considered the main three players, while IBM maintains a dominant spot in the hosted private cloud space. The Synergy report also found that Rackspace and Salesforce, while not as big as the others, remain strong players in their particular niche markets.

"Beyond those leading companies, the cloud market features a long tail of small-to-medium sized providers or companies that have only a minor position in the market, typically based on either a specific country or focused application area," Dinsdale wrote. "There are decent growth opportunities for some of these smaller players, but they are unlikely to make much impact in terms of overall worldwide market share.

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— Scott Ferguson, Editor, Enterprise Cloud News. Follow him on Twitter @sferguson_LR.

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4/30/2017 | 9:28:56 PM
Re: The market evoution
@Maryam: I think interms of the other players, they are starting to grow at the same pace AWS grew over the last few years. The issue will be can AWS offer enough features to keep pace with the second and third place competitors. Right now, AWS is so far ahead that even if they slow, they will still be ahead. But the issue is adding the support and features the larger enterprises want. That's where Azure can make up a lot of ground.

4/30/2017 | 12:53:08 PM
But the whole industry is growing
"While AWS dominates in terms of market share and revenue, the other major public cloud players continue to grow as well."

I think this is characteristic of an industry that is still in its growth stages, that is, far from the saturation point. There is still room for all or most players.
Joe Stanganelli
Joe Stanganelli
4/30/2017 | 10:39:12 AM
Little wonder, then, that in the voluminous NIST cloud roadmap report issued a couple of years ago, the federal gov't kvetched so much about AWS (although not by name, but it was obvious -- especially with direct references to ECUs) and wanting to regulate it as a utility.
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4/29/2017 | 6:11:08 PM
The market evoution
Scott it will be interesting to see how the cloud market evolves as the other major players address their strategy. I expect that the market will shake up both with pricing and bundling as it evolves. Service levels will also certainly play into the mix.
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