New research from Synergy Research Group has claimed global enterprise spending on cloud infrastructure services has surged in the past three months.
In Q4 2023, the report found cloud infrastructure service spend rose to an unprecedented $73.7 billion, marking a considerable 20% growth year-on-year.
Synergy attributes much of this growth to generative AI technology and other cloud-based productivity services.
Cloud spending continues to rise
Even compared with the third quarter of 2024, spending in the sector had risen by more than 8%, or $5.6 billion, which Synergy says is the largest quarter-on-quarter increase ever achieved.
As well as help from AI technologies, the company found that economic, currency, and political headwinds are also causing fewer holdbacks today than in previous months.
Despite healthy company growth and revenue figures, Amazon’s cloud market share has been decreasing slowly over the past year. The company now accounts for around 31% of the market.
Microsoft and Google have both been taking some of this market from the industry leader, now accounting for 24% and 11% respectively. Microsoft’s market share growth in the final quarter of 2023 was especially positive.
Fluctuation between these three companies continues to play out, but together, they account for two-thirds (67%) of the entire market, leaving little room for competitors and fuelling antitrust arguments about unfair dominance.
Huawei, China Telecom, Snowflake, MongoDB, Oracle and VMware were all noted to have seen healthy year-on-year growth, too, with IBM and Alibaba on a downward trend.
On the whole, Synergy estimates that cloud infrastructure service revenues, including IaaS, PaaS, and hosted private clouds, totalled $270 billion in the 2023 calendar year.
Looking ahead, the research firm predicts that the annual market will soon surpass $500 billion, and while the mention of a specific year lacks, concentrated growth thanks to a boom in cloud computing and artificial intelligence could mean this is sooner rather than later.
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