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Cloud Services a $6 Billion per Quarter Market: Synergy Research

In case the recent spate of positive earnings from Amazon and Microsoft haven’t already made it clear, new data from the Synergy Research Group confirms that the cloud computing market is on a tear. “There is a good reason why AWS [Amazon Web Services] and Microsoft were able to announce such strong cloud results last […]

Written By

Pedro Hernandez

Oct 26, 2015

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In case the recent spate of positive earnings from Amazon and Microsoft haven’t already made it clear, new data from the Synergy Research Group confirms that the cloud computing market is on a tear.

“There is a good reason why AWS [Amazon Web Services] and Microsoft were able to announce such strong cloud results last week,” said John Dinsdale, a chief analyst and research director at Synergy Research, in a research note sent to Datamation. “The market just passed $6 billion in quarterly revenues and the growth rate is increasing – and the dominant top four cloud providers are all benefitting greatly.”

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That quartet includes AWS, Microsoft, IBM and Google. AWS is the cloud leader with nearly a third of the market. All four command more than half of the worldwide market for cloud infrastructure services, according to Synergy.

These market-leading cloud companies aren’t “merely passive beneficiaries,” Dinsdale noted. “They are aggressively launching ever more services that target a broader range of IT workloads and applications,” suggesting that they are investing heavily to expand their capabilities and win over enterprise customers.

During the past four quarters, infrastructure-as-a-service (IaaS), platform-as-a-service (PaaS) hybrid and private cloud providers generated over $21 billion in revenues. While they may be catching up to AWS, both Microsoft and Google have revenue growth rates of over 100 percent.

Overall, the market seems to have recovered from a taxing cloud price war and largely shaken off some of the economic factors inhibiting higher sales, observed Dinsdale in a statement. “In early 2014 market growth was somewhat stymied by overly aggressive price competition and more recently there have been some headwinds caused by the strengthening dollar, but we are now seeing a truer picture of the underlying growth in cloud usage.”

Although the cloud may be old hat to some, there’s nowhere for the market to go but up, predicted Dinsdale.

“It might be tempting to think of cloud technologies as now being relatively mature, but the truth is that this is a market which is still in its very early stages of development,” he remarked. “As the leading cloud operators continue to launch an impressive array of new services we will continue to see a huge swing away from traditional IT practices to a world that will be dominated by the cloud.”

Pedro Hernandez is a contributing editor at Datamation. Follow him on Twitter @ecoINSITE.

Photo courtesy of Shutterstock.

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Pedro Hernandez

Pedro Hernandez is a contributor to Datamation, eWEEK, and the IT Business Edge Network, the network for technology professionals. Previously, he served as a managing editor for the Internet.com network of IT-related websites and as the Green IT curator for GigaOM Pro.