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AWS leaves cloud infrastructure services competitors in its wake

04 May 2016

Amazon Web Services continued to dominate the cloud infrastructure services market in the first quarter of 2016 – leaving all the followers in its wake.

New data from Synergy Research Group shows AWS holds a dominant lead with 31% of wht worldwide market share for cloud infrastructure services.

The ‘big three’ followers – Microsoft, IBM and Google – combined, accounted for just 22% of the market, with the next 20 top ranked cloud providers, including big names such as Alibaba, CenturyLink, Fujitsu, HPE, NTT, Oracle, Rackspace, Salesforce and VMware, accounted for a combined 27%.

Synergy says based on the Q1 financial earnings data released by the major operators, it believes quarterly cloud infrastructure service revenues including IaaS, PaaS and private and hybrid cloud, have now ‘comfortably passed the US$7 billion milestone.

And while AWS accounts for the lion’s share, Synergy notes that there is good news for Microsoft and Google, which both saw growth rates of ‘well over 100%’, enabling them to slowly gain ground on AWS. Slower growth by IBM however dragged the average growth for the three companies down to 93%.

While the 20 cloud providers outside the top four are growing on average 41% per year, Synergy Research notes that given the market is growing at more than 50%, that actually means most of them are losing market share.

John Dinsdale, Synergy Research Group chief analyst and research director, says: “This is a market that is so big and is growing so rapidly that companies can be growing by 10-30% per year and might feel good about themselves, and yet they’d still be losing market share.

“The big question for them is whether or not they are building a sustainable and profitable business,” adds.

Dinsdale says building a sustainable and profitable business can be done by focusing on specific regions or specific services, but the bulk of the market demands huge scale, a broad footprint, very deep pockets and a long-term corporate focus.

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