Cloud Spending Growth Slows, While Big Providers Squeeze Little Guys Even Harder

Mitch Wagner
10/26/2018
50%
50%

Spending growth on cloud providers slowed some in the most recent quarter, but the market is still growing. The top four cloud providers are continuing to dominate the market, leaving less room for smaller companies.

With the last two of the major cloud providers reporting third-quarter earnings Thursday afternoon, Synergy Research delivered its quarterly market share report soon after. The research firm found that spending on cloud infrastructure services was up 45% year-over-year, "a little slower than the growth rate achieved in the first two quarters of the year, but [growth] compared favorably with growth rates achieved through 2017."

The research firm continues: "Revenue growth at Microsoft, Google, and Alibaba again far surpassed overall market growth rate, so all three gained market share with Microsoft, in particular, jumping ahead. Market leader Amazon maintained its dominance and remains bigger than its next four competitors combined. Its sheer scale prevents it from growing as fast as the chasing pack, but it still managed to nudge up its market share a percentage point to a little over 34%. The market share gains of these four came at the expense of small-to-medium sized cloud operators.

While many of those smaller providers are seeing consistent revenue growth, they are lacking the scale and financial muscle of the leaders and are unable to keep pace with their larger competitors. Meanwhile, IBM market share dropped off the pace a little but remained at comfortably over 7%, thanks primarily to its strong leadership in hosted private cloud services."


Now entering its fifth year, the 2020 Vision Executive Summit is an exclusive meeting of global CSP executives focused on navigating the disruptive forces at work in telecom today. Join us in Lisbon on December 4-6 to meet with fellow experts as we define the future of next-gen communications and how to make it profitable.


Synergy estimates quarterly cloud infrastructure service revenues are "well over $17 billion." That includes infrastructure- and platform-as-a-service, as well as hosted private cloud.

"The Q3 growth rate of 45% compares with a full-year 2017 growth rate of 44% and a 2016 growth rate of 50%. Public IaaS and PaaS services account for the bulk of the market, and those grew by 51% in Q3. In the public cloud, the dominance of the top five providers is even more pronounced, as they control almost three-quarters of the market. Geographically, the cloud market continues to grow strongly in all regions of the world," Synergy says.

Related posts:

— Mitch Wagner Follow me on Twitter Visit my LinkedIn profile Visit me on Tumblr Follow me on Facebook Executive Editor, Light Reading

(0)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Featured Video
Flash Poll
Upcoming Live Events
September 17-19, 2019, Dallas, Texas
October 1, 2019, New Orleans, Louisiana
October 2-22, 2019, Los Angeles, CA
October 10, 2019, New York, New York
November 5, 2019, London, England
November 7, 2019, London, UK
December 3-5, 2019, Vienna, Austria
December 3, 2019, New York, New York
All Upcoming Live Events
Partner Perspectives - content from our sponsors
Transform Beyond Borders to Lead the Innovation
By Ben Zhou, CEO, Whale Cloud
Reject Limits. Build the Future.
By David Wang, Huawei
China Telecom & Huawei Jointly Complete the World's First End-to-End 5G SA Voice & Video Call
By Jay Liu, Senior Marketing Manager, Cloud Core Product Line, Huawei Technologies
All Partner Perspectives