Cloud infrastructure services spending rises in Q1, 2019; Amazon maintains lead

Q1 spend on cloud infrastructure services jumped 42% from the first quarter of 2018, according to Synergy Research Group

Cloud infrastructure services spending rises in Q1, 2019; Amazon maintains lead - CIO&Leader

Q1 spend on cloud infrastructure services jumped 42% from the first quarter of 2018, according to Synergy Research Group. Predictably this growth rate was somewhat lower than that seen throughout 2018 as the massive scale of the market now forces growth rates to moderate. Meanwhile, Amazon again grew faster than the overall market, as it has done for the last eight quarters. Behind Amazon a group of four cloud providers are substantially outpacing overall market growth and are gaining market share. Microsoft, Google, Alibaba and Tencent all saw revenues increase by 70% or more year-on-year. Another group of four cloud providers have substantial market share but are somewhat niche players and typically have lower growth rates – IBM, Salesforce, Oracle and Rackspace.

With most of the major cloud providers having now released their earnings data for Q1, Synergy estimates that quarterly cloud infrastructure service revenues (including IaaS, PaaS and hosted private cloud services) were well over USD 21 billion, with revenues for the last four quarters now reaching over USD 75 billion. Public IaaS and PaaS services account for the bulk of the market and those grew by 48% in Q1. In public cloud the dominance of the top five providers is even more pronounced, as they control over three quarters of the market. Geographically, the cloud market continues to grow strongly in all regions of the world.

“This is another impressive growth quarter for the cloud market. The decline in growth rate should not be viewed as a weakening market but as an inevitable consequence of a market that has now reached massive scale. For the eighth consecutive quarter the market size has increased by well over a billion dollars over the previous quarter,” said John Dinsdale, a Chief Analyst at Synergy Research Group. “As the market goes from strength to strength the pack of cloud providers that are chasing Amazon has bifurcated into high-growth challengers and lower growth niche-oriented providers. But Amazon retains its strong leadership position and continues to control a third of the worldwide market.

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