Dive Brief:
-
Amazon Web Services' dominance continued, as the cloud giant is more than three times the size of its nearest rival and its revenue growth over four quarters is around $1.2 billion, according to Synergy Research. Both Microsoft and Google nearly doubled their quarterly revenues since Q2 of 2016 and both have increased their market share substantially.
-
But evidence suggests Microsoft, IBM and Google may be making progress against AWS. In February, a study released by Synergy Research Group found AWS controlled about 40% of the cloud market, while Microsoft, Google and IBM together control only about 23%. Today, AWS' market share stands at 34%, compared to 11% for Microsoft, 8% for IBM and 5% for Google.
-
Outside the top four, Alibaba and Oracle are achieving the highest growth rates, while the lower ranked cloud providers continue to lose share to the leaders, according to Synergy.
Google and Microsoft outpace cloud market share leader AWS in Q2 2017
| Company | ▲ Growth Rate | Market Share |
|---|---|---|
| AWS | +42% | 34% |
| Microsoft | +97% | 11% |
| IBM | +23% | 8% |
| +92% | 5% | |
 Total |
58% |
SOURCE: Market share data from Synergy Research Group. Growth Rate on an annual basis from Canalys.
Dive Insight:
The results are in and the cloud market continued its rapid growth, marking huge gains for leading companies. Microsoft Azure grew 97% year-over-year in the second quarter of 2017. AWS grew 42% during the same period. Google boasted 92% growth, Canalys reports, and the cloud infrastructure market as a whole had 47% year-over-year growth.
The enterprise appetite for cloud computing has not slowed, driven by the demand for primary cloud infrastructure services. Cloud technology has now reached a point where IT leaders are looking toward specialized solutions, tailoring their cloud adopting.
This is in part why AWS' share is slipping. Its dominance is not guaranteed as other service providers rally to provide solutions that fit more nuanced enterprise leads. Though the 10 cloud providers trailing the top four have had growth stall, their specialized offerings will likely remain market staples.
Should AWS be worried about its dominance? Probably not, considering it is the clear market leader. But its true dominance won't last forever as more mature solutions come to market from other providers. But if AWS continues to work on advanced computing — like artificial intelligence services — and maintains its reputation for innovation, its cloud computing dominance is sure to persist.
