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AWS generated almost half of all IaaS revenue in 2018

AWS generated almost half of all IaaS revenue in 2018

Global IaaS market generated US$32B last year

Credit: Dreamstime

The global infrastructure-as-a-service (IaaS) market has grown 31.3 per cent in 2018 generating US$32.4 billion in revenues according to research firm Gartner.

Amazon Web Services (AWS) was again the number one vendor in the IaaS market in 2018, followed by Microsoft, Alibaba, Google and IBM respectively.

Garnet noted that in 2018, the top five IaaS providers accounted for nearly 77 per cent of the global IaaS market, up from less than 73 per cent in 2017. 

"Despite strong growth across the board, the cloud market’s consolidation favors 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,” Nag added.

AWS generated an estimated US$15.5 billion of revenue in 2018, up 27 per cent percent from 2017. Microsoft generated just over US$5 billion in 2018, up from US$3.1 billion in 2017.

Data provided by Gartner
Data provided by Gartner

Alibaba Cloud experienced the strongest growth among the leading vendors according to Gartner, growing 92.6 per cent in 2018. The research firm noted that Alibaba built an ecosystem consisting of managed service providers (MSPs) and independent software vendors (ISVs) with its success last year being driven by aggressive R&D investment in its portfolio of offerings, especially compared with its hyper-scale provider counterparts.

Google grew 60.2 per cent in revenue from 2017 with estimated revenue of US$1.3 billion

“As the cloud business continues to gather momentum and hyper-scale 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 hyper-scale cloud provider partner programs in order to drive revenue,” said Nag.

Gartner had previously forecast that demand for cloud IaaS will present the fastest-growing market, almost doubling from $652 million in 2019 to $1.2 billion in 2022.

According to local research firm Telsyte, the cloud IaaS market alone has seen organisations spend $688 million in 2018 in Australia.

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Tags MicrosoftGartnerGoogleiaasalibabaAWS

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