The global cloud market is booming, and these two giants are dominating it

According to new figures from Gartner, the infrastructure-as-a-service sector of the global cloud market, which is now valued at more than $120 billion, grew by 30% last year.

The sector reportedly grew from an already healthy $92.8 billion in 2021 to $120.3 billion in 2022, representing a 29.7% increase despite the slowdown in growth that many companies experienced toward the end of 2022 due to tough economic headwinds.

Of the $120 billion, an estimated $74 billion is attributable to just two dominating companies: Amazon Web Services (AWS) and Microsoft Azure.

AWS and Azure account for huge cloud spends

Together, Amazon and Microsoft’s offerings totalled nearly two-thirds (61%) of the market, accruing $48 billion and $26 billion respectively. 

Alibaba Cloud tipped the scales at $9.28 billion, helping it to secure third place, just a few million ahead of Google Cloud in fourth at $9 billion. Huawei rounded up the top five at $5.25 billion. Collectively, the top five left less than 19% for all other IaaS providers to battle it out for their share of the revenue.

More specifically, Gartner VP analyst Sid Nag indicated at heightened geopolitical tensions in relation to China, which have limited Alibaba Cloud’s opportunity for any significant global growth.

On the other side of the spectrum, Amazon and Microsoft typically account for large sections of the market under whichever microscope is used, which has led many analysts and organizations to criticize their unfair dominance.

Looking ahead, it’s unclear what sort of effect the economy will have on the cloud market, but while many companies are looking to restrict spend, cloud remains an important expense for many organizations. Nag suggested that some troubles may continue into mid-2023, with acceleration forecasted for 2024.

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Via The Register