The worldwide market for cloud infrastructure and services reached $148 billion for the four quarters ending in September 2016, up 25% compared with the four quarters ending in September of 2015. More than half the growth came in two sectors, infrastructure as a service (Iaas) and platform as a service (PaaS), where Amazon.com Inc.'s (AMZN) Amazon Web Services (AWS) and Microsoft Corp.'s (MSFT) Azure dominated with a combined 53% of year-over-year revenue growth.
In addition to Amazon and Microsoft, the other two leading players in cloud technology are Google/Alphabet Inc. (GOOGL) and International Business Machines Corp. (IBM). Together the four companies control 50% of the worldwide cloud business, with AWS owning about a third of global share, according to Synergy Research Group.
Hewlett Packard Enterprise Co. (HPE) and Cisco Systems Inc. (CSCO) are the leading providers of public and private cloud hardware to data centers, while Microsoft racks up 40% of cloud software market share.
However, John Dinsdale, research director at Synergy Research Group, noted last August that the other big players are showing strength:
The ranking of the next 20 largest cloud providers features some interesting companies, with Alibaba and Oracle growing particularly strongly, but they are all starting from a long way behind Google, which is itself growing by well over 100% per year and yet remains only a sixth the size of Amazon.
When Oracle Corp. (ORCL) reported earnings after markets closed on Wednesday, CEO Safra Catz made a special point of how fast the company's cloud services are growing:
Our new, large, fast-growing, high-margin cloud businesses are driving Oracle's total revenue and earnings up and improving nearly every important non-GAAP business metric you care to inspect; total revenue is up, margins are up, operating income is up, net income is up, EPS is up. Take a look.
In the public cloud market, Amazon held 40% of the market in the fourth quarter of last year. Microsoft, Google and IBM held a combined total of about 24%. Everybody else shared the remain 36%. But the "everybody else" group included both Alibaba and Oracle, both of which continue to grow rapidly.
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In a February press release, about public cloud leadership, Synergy Research's Dinsdale commented:
While a few cloud providers are growing at extraordinary rates, AWS continues to impress as a dominant market leader that has no intention of letting its crown slip. Achieving and maintaining a leadership position in this market takes huge ongoing investments in infrastructure, a continued expansion in the range of cloud services offered, strong credibility with the large enterprise sector, consistently strong execution, and the wholehearted and long-term backing of senior management. AWS is checking all of those boxes and any serious challengers need to do likewise.