2022 saw cloud infrastructure services in high demand, as global spending increased 33% year over year to $62.3 billion dollars. The success and growth are compelled by various factors, including rising demand for data analytics and AI (machine learning), the continued consolidation of data centers, migration of applications, and cloud-native development. The increasing utilization of vertical-specific cloud applications also contributed to the horizontal use scenarios seen across IT digital transformation. The top three vendors in Q2 2022, namely Amazon Web Services (AWS), Microsoft Azure, and Google Cloud, grew 42% and combined to account for 63% of global spending.
Global Cloud Infrastructure Services – Trends
In a worldwide economy struggling with rising inflation, soaring interest rates, and looming recession, the demand for cloud infrastructure services is still robust. AWS is currently the leading cloud services provider, representing 31% of total cloud services spending in 2022 and growing 33% annually. Azure is in second place in the cloud services race, claiming a 24% market share and 40% annual growth. Google Cloud represents the least amount of market share, at only 8%.
The market share tug-of-war between AWS and Microsoft Azure continues to dominate the space, with Azure quickly closing in on the top spot. Microsoft recently reported a significant number of large, multi-year contracts in both the US$100 million-plus and US$1 billion-plus segments. A rich go-to-market strategy, along with a diverse portfolio and broad spectrum of partnerships, is giving Microsoft the leverage it needs to continue to close in on AWS.
Cloud infrastructure services are one of the strongest growth segments in technology. While there are many opportunities for providers of all sizes, the most significant fight remains between AWS and Microsoft. Keeping up with demand and staying on top of the needed infrastructure is expected to be challenging for both companies as inflationary pressures increase.
In fact, both Microsoft and AWS are rolling out infrastructure to keep up with demand. AWS’s strategy includes the launch of 24 availability zones across eight regions, while Microsoft will introduce 10 new regions in the next 12 months. Both companies are investing outside of the United States in their quest to capture demand and guarantee that they can deliver low-latency and high-data solutions.
In addition to their capacity investments, software features and partnerships will be essential in meeting customers’ cloud infrastructure demands – especially when taking into consideration the computing requirements of highly specialized services across various verticals. Research analysts believe that most companies have already shifted a portion of their workflow to the cloud but are now looking to increasingly move more critical services to the platform. In response, the leading cloud providers are stepping up their partnerships with software businesses to prove a strategic value proposition. Most recently, Microsoft offered expanded services designed to migrate additional Oracle workloads to Azure.
Alliance IT and Cloud Services
With cloud services solutions from Sarasota-based Alliance IT, utilizing, upgrading, and maintaining your IT platform has never been easier. Our team of IT professionals expertly manages your company’s software, technology, and applications. Your organization can eliminate the expense of continually investing in evolving network infrastructure, licensing new software, and recruiting/training new employees. Our services help you stay on budget while allowing your IT team to focus on the important business at hand.
Alliance’s cloud infrastructure services can function as your comprehensive and custom-designed hosting environment. If that is too involved for your current situation, we can simply help you to implement Office 365 or Windows Azure at your location. Call us today to schedule a free business technology assessment.
