The global cloud storage market is white hot, and the big keep getting bigger while indies lose ground, according to a study by Synergy Research Group that says the top three companies — Amazon Web Services (AWS), Microsoft and Google — account for 65 percent of what was in the first quarter of 2022 assessed as a $53 billion worldwide market. That’s up from a combined 52 percent of worldwide sales four years ago, Synergy notes, explaining the trio’s slice of this rapidly growing market is expected to expand as their efficiencies of size make them better equipped to continue investing and wooing new clients.
“Though well established, the cloud units of Amazon, Microsoft, and Alphabet Inc.’s Google have been expanding like startups, with sales growing by more than 30 percent year-over year in recent quarters while smaller cloud services have seen their market share drop as more cloud spending migrates to the largest platforms, according to Synergy,” writes The Wall Street Journal.
“The top cloud players have consolidated their dominance in part because of the economics of the industry, which requires massive investments in servers and the facilities that house them,” notes WSJ.
“We’ve been investing pretty significantly in this business for 15 years, and it’s not something that’s easy to catch up to,” said AWS senior VP of sales and marketing Matt Garman.
According to WSJ, smaller companies in the sector “are expected to face a more challenging fundraising environment” as investors adapt to a bear market and customers seek “to consolidate their spending” among bigger players that offer “more reliability and a broader set of features.”
Overall, the total global cloud market is expected to grow from $78.6 billion in 2022 to $183.7 billion by 2027, a compound annual growth rate (CAGR) of 18.5 percent, according to the latest MarketsandMarkets forecast.
Backup and disaster recovery are poised to be two of the most vigorous growth sectors, reports Yahoo Finance, which writes that these solutions are growing in popularity as they “save enterprises the task of maintaining the costly hardware infrastructure needed” to maintain those contingencies. Benefits such solutions offer include data synchronization and online viewing.
Geographically speaking, the Middle East and Africa are expected to grow at the highest CAGR during the MarketsandMarkets forecast period, Yahoo Finance says, noting that an “increase in the number of investments for developing new technologies,” such as analytics, big data and business intelligence will also spur growth of the cloud storage market in these regions.
68% of Firms Using AWS Plan on Becoming More Reliant on Cloud Systems by Next Year, Digital Information World, 7/7/22
AWS CEO Says the Move to Cloud Computing Is Only Just Getting Started, CNBC, 6/28/22
Google Cloud CEO Thomas Kurian: Cloud Computing Is on the Brink of a New Era, Protocol, 6/26/22
Cloudwerx Announces Premier Status in Google Cloud Partner Advantage Program, Yahoo Finance, 7/6/22
Avoiding Sticker Shock When Paying for the Cloud, Forbes, 7/6/22
Azure’s Capacity Limitations Are Continuing. What Can Customers Do?, ZDNet, 7/6/22