New data from Synergy Research Group shows that cloud infrastructure increased by 50% from the second quarter of 2017.
Four key markets players achieved particularly high growth rates, surpassing that of the overall market. Microsoft (14%), Google (6%), Alibaba (4%) and Amazon all gained market share, with Amazon maintaining its dominance stepping up its market share by a whole percentage point to 34%.
"Well, they’ve done it again," said John Dinsdale, a chief analyst at Synergy Research Group. "Amazon Web Services and its three main challengers all turned in some exceptional growth numbers in the quarter. Collectively those four firms alone accounted for well over three quarters of the sequential growth in cloud service revenues."
Amazon’s market share is bigger than its next four competitors combined, and as these top four continue to exert their market dominance it is the small-to-medium sized cloud providers that have seen their market share reduce.
"In a large and strategically vital market that is growing at exceptional rates, they are throwing the gauntlet down to their smaller competitors by continuing to invest enormous amounts in their data centre infrastructure and operations. Their increased market share is clear evidence that their strategies are working," added Dinsdale.
Looking at the broader picture in the top 25 cloud providers, only a further three companies have seen their market share increase significantly, though none past the 1% market share threshold. IBM’s market share has remained consistent at around 8% which Synergy says is thanks in part to its strong leadership in hosted private cloud services.
The overall market growth is in line with rates achieved in the first quarter of 2017 and higher than those achieved throughout the year.
As most major cloud companies have now released their Q2 earnings, Synergy predicts that quarterly cloud infrastructure service revenues, which includes IaaS, PaaS and hosted private cloud, are now approximately $16 billion.
The growth rate of 50% is compared with a full-year 2017 growth rate of 44% and a 2016 growth rate of 50%. Public IaaS and PaaS services account for the majority of the market and those grew 53% in Q2. In the public cloud sector the dominance of the top five providers is even more apparent because they control three quarters of the market. Regionally the cloud market is going globally.
Last month, Synergy released its latest figures on public cloud provider spending on infrastructure hardware and software. According to figures this grew by 32% from Q1 2017 totalling revenues of $11 billion in first quarter of 2018.
