IBM, Microsoft and Google Still Playing Catch-Up with Amazon in IaaS/PaaS Market

RENO, NV, August 21, 2013

New Q2 data from Synergy Research Group shows that Amazon (AWS) still maintains a formidable lead in the worldwide IaaS/PaaS market. The three IT heavyweights - Microsoft, Google and IBM - are all chasing hard and are growing aggressively, but their aggregated revenues in the market still equate to only 63% of Amazon’s. While a much smaller company overall, Salesforce with its force.com offering has similar cloud infrastructure revenues to the other three chasing companies. However, in a market that grew 47% year-on-year, Amazon actually grew by 52% and increased its overall market share to over 28%.

Total IaaS/PaaS revenues for the quarter came in at $2.25 billion, with IaaS accounting for the lion’s share - 64%. North America accounted for 53% of the Q2 market, with EMEA and APAC each accounting for 21% and Latin America 5%. Amazon is the clear market leader in each of the four regions, though the ranking of the chasing pack does differ by region. Associated infrastructure service markets all grew in the quarter, but much more slowly than IaaS and PaaS. Managed hosting revenues grew by 2% year on year, retail colocation grew by 8% and CDN by 15%.

“Starting from a much smaller base the big three IT companies actually achieved higher growth rates, but Amazon is doing an impressive job of keeping its grip on market leadership and remains in a league of its own” said Synergy Research Group’s John Dinsdale. “The real race is to see if any of the chasing pack can establish themselves as a clear number two in the IaaS/PaaS market. While IBM’s acquisition of SoftLayer helped it to leapfrog both Microsoft and Google, the three remain tightly bunched with somewhat similar growth trajectories.”