Same song, different verse for Amazon Web Services as it continues to be the market leader in the cloud services sector, according to a report by Synergy Research Group.
Amazon Web Services increased its market share at the end of last year to the point where it is equivalent in size to the next four competitors combined. In order, Microsoft, Google, IBM and Alibaba held the top spots after AWS, according to Synergy Research Group. Revenue growth at Microsoft, Google and Alibaba surpassed the overall market growth rate, with Microsoft in particular posting strong growth results.
The increased market share of Microsoft, Google, IBM and Alibaba once again came at the expense of the small-to-medium sized cloud operators, who collectively lost 5 percentage points of market share over the last four quarters. Synergy Research Group noted that the smaller cloud providers' revenues were still growing, but not at the same pace as the market leaders.
While IBM is fourth overall, Synergy Research Group said it was still the market leader in the hosted private cloud services segment.
Fourth quarter spending on cloud infrastructure services increased 45% from the same quarter in 2017 while overall spending last year posted a growth rate of 48%.
“Q4 tops off a banner year for the cloud market with the annual growth rate actually nudging up from the previous year, which is an unusual phenomenon for a high-growth market of this scale,” said John Dinsdale, a chief analyst at Synergy Research Group, in a prepared statement. “The rate at which the market leaders continue to expand is really rather impressive. In aggregate the top five drove up their revenues in these segments by 60% in 2018, which has caused us to review and increase our five-year forecast for the market."
"Inevitably there will be a few road bumps along the way but these will be minor relative to the factors that continue to drive the market,” he added.
With the majority of the large cloud service providers having reported their earnings for the fourth quarter, Synergy estimated that quarterly cloud infrastructure service revenues—including IaaS, PaaS and hosted private cloud services—were approaching $20 billion for a projected full-year total of almost $70 billion.
Public IaaS and PaaS services, which account for the bulk of the market, grew by 49% in the fourth quarter.