Amazon continues to dominate IaaS market

IaaS
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Amazon retained its top spot as the number one vendor in the infrastructure as a service (IaaS) market in 2018 according to the latest figures from Gartner.

Last year the IaaS market grew by 31.3 percent to reach $32.4bn with Amazon taking the lead followed by Microsoft, Alibaba, Google and IBM.

Research vice president at Gartner, Sid Nag explained why tech giants like Amazon continue to dominate the IaaS market, saying:

"Despite strong growth across the board, the cloud market’s consolidation favours the large and dominant providers, with smaller and niche providers losing share. This is an indication that scalability matters when it comes to the public cloud IaaS business. Only those providers who invest capital expenditure in building out data centres at scale across multiple regions will succeed and continue to capture market share. Offering rich feature functionality across the cloud technology stack will be the ticket to success, as well.” 

IaaS market consolidation

The top five IaaS providers accounted for almost 77 percent of the global IaaS market in 2018, up from less than 73 percent in 2017. Gartner expects that market consolidation will continue through 2019 as a result of the high rate of growth for the top providers which experienced aggregate growth of 39 percent from 2017 to 2018 compared with the more modest growth of 11 percent for all other providers during the same period.

Amazon continued to lead the global IaaS market with an estimated $15.5bn in revenue during 2018. In addition to being the largest of the IaaS providers, the company accounts for nearly half of the total IaaS market.

Microsoft managed to secure the number two position in the IaaS market with revenue surpassing $5bn in 2018, up from $3.1bn in 2017. Among the leading vendors, Alibaba Cloud was the dominant IaaS provider in China and the firm grew by 92.6 percent in 2018.

Google earned the number four spot as it grew its revenue by 60.2 percent from 2017.