Amazon, Microsoft and Google together now make up 63% of enterprise spending on cloud infrastructure services in the third quarter.
A new Synergy Research report revealed that this group’s market share has been gradually rising. At the same time, the “boom” in cloud usage has driven the worldwide market value to $107 billion in the third quarter, up from $68 billion eight quarters ago.
However, within this group, Amazon's market share has gradually declined, while both Microsoft and Google have gained market share. In the third quarter, their worldwide market shares were 29%, 20% and 13% respectively.
“Amazon’s market share has averaged just under 30% over the past four quarters, down from a little over 32% in 2021,” said John Dinsdale, Chief Analyst at Synergy Research Group. “Its share is showing gradual erosion as Microsoft and Google continue to close the gap, yet it remains striking how effectively Amazon has maintained its leadership position.”
The neocloud factor
While the second tier of cloud providers is significantly smaller than the big three, a notable development is the emergence of the neocloud sector.
Unlike traditional hyperscalers, Neoclouds are a new group of cloud providers focused on high-performance GPU compute for intense AI/ML workloads, offering bare-metal access, lower latency, and flat-rate pricing. These providers primarily offer GPU-as-a-Service (GPUaaS).
Leading the neocloud market is CoreWeave. Joining CoreWeave are Crusoe, Nebius, and Lambda, all of which are seeing growth.
While Alibaba and Salesforce continue to grow their cloud infrastructure service revenues, they are not growing as fast as the overall market. Synergy said that other players, such as IBM, have “remained static as it has changed its focus and strategy.”
Outside of the leading group, there are several other minor players, which Synergy noted “have grown rapidly, but in aggregate those smaller players have been steadily losing market share.”
Public IaaS and PaaS dominate
Led by IaaS and PaaS, worldwide cloud infrastructure service revenues were $106.9 billion, with trailing twelve-month revenues reaching $390 billion.
In the third quarter, IaaS and PaaS grew by 30%.
From a geographic perspective, the cloud market continues to grow strongly across all regions worldwide.
Specifically, India, Australia, Indonesia, Ireland, Mexico and South Africa are growing at rates above the worldwide average.
However, the US remains by far the most significant cloud market, with its scale far exceeding that of the Asia-Pacific region. The US market grew by 28% in Q3.
Finally, in Europe, the largest cloud markets are the UK and Germany, but the fastest-growing markets were Ireland, Spain, and Italy.
