Infrastructure cloud market $11bn higher than a year ago as AWS and Microsoft get fatter and fatter

Two words: Digital transformation. Stop gagging. It's about how we learned to love the cloud


Customers' infrastructure cloud spending splurge smashed through the $40bn barrier globally for Q1 as business continue to digitise processes and workflows - with Amazon Web Services, Microsoft and Google the major recipients of the cash.

IaaS swelled 35 per cent to $41.8bn, said analyst Canalys, which collated the numbers. The major drivers remained using cloud for data analytics and ML, data centre consolidation, application migration, cloud native development and service delivery.

“Cloud emerged as a winner across all sectors over the last year, basically since the start of the COVID-19 pandemic and the implementation of lockdown,” said Blake Murray, research analyst.

AWS - which last night reported its own financial results - grew IaaS revenues 32 per cent in Q1 to $13.376bn, according to Canays, giving it a market share of 32 per cent.

During the quarter, AWS confirmed a second full region in Japan and plans o launch 15 additional Availability Zones and five more AWS Regions in Australia, India, Indonesia, Spain and Switzerland. Also landing during the quarter are the new EX2 X2gd instances that are based on the home grown Graviton2 CPU.

Over in Redmond, Microsoft Azure turned over a 50 per cent year-on-year hike in sales - for the third consecutive quarter - to $7.941bn. CEO Satya Nadella boasted this week, during a Q3 results call with analysts, that Microsoft had built more data centre regions than any rival, and that clients including Fujitsu and KMPG had started using Azure Arc to ease management of their hybrid IT estates.

Google's infrastructure cloud sales jumped 56 per cent in Q1 to $2.926bn. Cloud native development and accelerated moves by customers to its industry-specific services helped bring in more money, as did cloud-based ML and analytics.

The others section comprised the remainder of the IaaS sector.

The Q1 spending figure is $11bn higher than in Q1 last year, and $2bn more than the final three months of 2020. Businesses adapting to the WFH revolution, along with digitising customer engagement, biz processes and supply chain all influenced the decision to spend more on the cloud.

Murray said: “Though 2020 saw large-scale cloud infrastructure spending, most enterprise workloads have not yet transitioned to the cloud. Migration and cloud spend will continue as customer confidence rises during 2021.

“Large projects that were postponed last year all resurface, while new uses cases will expand the addressable market.”

Investment at the edge, including 5G, would be vital for ultra-low latency applications and use cases such as autonomous cars and industrial robotics, the research analyst added. ®


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