Worldwide IaaS Public Cloud Services Market Grew 31.3 Percent Last Year: Gartner

0
774
  • Amazon, Microsoft, Alibaba, Google and IBM accounted for nearly 77 percent of the global IaaS market in 2018.
  • Amazon accounts for nearly half of the total IaaS market.
  • Alibaba Cloud experienced the strongest growth among the leading vendors, growing 92.6 percent in 2018

The worldwide infrastructure as a service (IaaS) market grew 31.3 percent in 2018 to total $32.4 billion, up from $24.7 billion in 2017, according to Gartner.

Amazon continued to lead the worldwide IaaS market with an estimated $15.5 billion of revenue in 2018, up 27 percent from 2017. It was followed by Microsoft, Alibaba, Google and IBM.

In 2018, the top five IaaS providers accounted for nearly 77 percent of the global IaaS market, up from less than 73 percent in 2017.

“Despite strong growth across the board, the cloud market’s consolidation favours the large and dominant providers, with smaller and niche providers losing share,” said Sid Nag, research vice president at Gartner.

“This is an indication that scalability matters when it comes to the public cloud IaaS business. Only those providers who invest capital expenditure in building out data centres at scale across multiple regions will succeed and continue to capture market share. Offering rich feature functionality across the cloud technology stack will be the ticket to success, as well,” he added.

Market consolidation

The research firm projected that market consolidation will continue through 2019, driven by the high rate of growth for the top providers, which experienced aggregate growth of 39 percent from 2017 to 2018. Other providers witnessed a more modest growth of 11 percent during the same period.

“Consolidation will occur as organizations and developers look for standardized, broadly supported platforms for developing and hosting cloud applications,” asserted Nag.

Top Five IaaS Providers

  • The largest of the IaaS providers, Amazon accounts for nearly half of the total IaaS market. It continues to aggressively expand into new IT markets via new services, as well as acquisitions, growing its core cloud business.
  • Microsoft secured the No. 2 position in the IaaS market with revenue surpassing $5 billion in 2018, up from $3.1 billion in 2017. Microsoft delivers its IaaS capabilities through its innovative and open Microsoft Azure offering, which continues to solidify its position as a leading IaaS provider.
  • The dominant IaaS provider in China, Alibaba Cloud, experienced the strongest growth among the leading vendors, growing 92.6 percent in 2018. The company has built an ecosystem consisting of managed service providers (MSPs) and independent software vendors (ISVs). Its success last year was driven by aggressive R&D investment in its portfolio of offerings, especially compared with its hyperscale provider counterparts.

“Alibaba has the financial capability to continue this trend and invest in global expansion,” Gartner said.

  • Google came in at the No. 4 spot, growing 60.2 percent in revenue from 2017.

“Google’s cloud offering is something to keep an eye on with its new leadership focus on customers and shift toward becoming a more enterprise-geared offering,” noted Nag.

He suggested, “As the cloud business continues to gather momentum and hyperscale cloud providers consolidate the market, product managers at cloud MSPs must look at other ways to differentiate, such as focusing on vertical industries and getting certified in the hyperscale cloud provider partner programs in order to drive revenue.”

Gartner IT Infrastructure, Operations & Cloud Strategies Conferences

Gartner analysts will provide additional analysis on cloud strategies and infrastructure and operations trends at the Gartner IT Infrastructure, Operations & Cloud Strategies Conferences taking place November 25-26 in London and December 9-12 in Las Vegas.

 

 

 

LEAVE A REPLY

Please enter your comment!
Please enter your name here