In this article, we look at the 12 largest cloud providers by market share in the world. If you want to see more of the world’s largest cloud providers by market share, go straight to The 5 Largest Cloud Providers by Market Share in the World.
Cloud computing is a growing sector.
In cloud computing, there are two sectors, both growing, cloud infrastructure as a service or IaaS, and software as a service or SaaS.
In terms of cloud infrastructure as a service, there are not that many large infrastructure as cloud service providers around the world given the significant initial capital required to be competitive in the field. Since cloud infrastructure as a service is very competitive with many of the biggest players constantly charging their fees per processing unit, only the biggest players are profitable. As a leader, Amazon Web Services accounts for a significant percentage of Amazon’s total profits. Meanwhile, big cloud providers like Google Cloud are still losing money in an attempt to increase their market share.
In terms of the cloud software as a service market, it could be argued that the market is less competitive because it is more fragmented. Since many customers pay software as a service provider, there is also recurring revenue potential.
Third Quarter 2022 Growth of the Cloud Infrastructure Services Industry
Although highly competitive, the market for cloud infrastructure services is huge.
According to the Synergy Research Group, total enterprise spending on cloud infrastructure services in the third quarter of 2022 rose more than $11 billion from Q3 2021 to more than $57 billion. During the quarter, the cloud market at the top was highly concentrated as the top three players of Amazon, Microsoft, and Google have about two-thirds of the global market share of the cloud infrastructure services market.
Synergy Research Group Principal Analyst John Dinsdale said of the Q3 industry results, “It’s a strong testament to the benefits of cloud computing that the global market grew 24% from last year despite two major obstacles to growth. If exchange rates remained stable and the Chinese market remained on a normal path the percentage growth rate would be well into the thirties. All three cloud computing providers report their financials in US dollars so their growth rates have been driven down by the historical strength of their home currency.”
In terms of their individual growth rates, Amazon Web Services grew 27.5% year over year, Microsoft Azure grew 35% year over year and Google Cloud Platform grew 38% year over year.
Given the growth in the third quarter, the trailing twelve-month revenue of the cloud infrastructure services market reached $217 billion according to Synergy Research Group estimates.
In light of rising interest rates and possible macroeconomic uncertainty due to the recession, some enterprises have become more cautious in their spending and total industry spending for the period was less than some estimates.
The Future Growth
Due to the tailwinds in the industry in the long term, analysts expect the cloud infrastructure as a service market to grow significantly in the future. According to Research and Market, the average cloud computing CAGR from 2022 to 2030 could grow at an average CAGR of 15.7% from 2022 to 2030 to exceed $1.55 trillion by 2030 as more businesses migrate to cloud computing for cost savings and flexibility.
One reason for much more expected growth is AI processing. As AI applications such as ChatGPT become more popular, the demand for cloud computing may grow further. Considering the amount of cloud computing power required to run an application as sophisticated as ChatGPT, high-tech cloud providers are among the few companies that can offer the processing required to run an application like ChatGPT.
In 2019, Microsoft invested $1 billion in OpenAI in the form of cash and credits for Microsoft’s Azure cloud computing platform. Since ChatGPT has seen significant demand since its launch, the company is reportedly looking to raise more capital at a valuation of around $30 billion. When it raises more capital, it is likely that a significant amount will be spent on cloud processing to make ChatGPT even better, which could bring more business to Microsoft.
Methodology
For our list of the 12 Largest Cloud Computing Providers by Market Share in the World, we only list the market shares of the cloud infrastructure as a service market and not the software as a service market because they are two different markets.
We ranked the cloud providers based on their market shares in the cloud infrastructure services market which includes platform as a service, infrastructure as a service and hosted private cloud services according to Synergy Research Group in Q3 2022.
Because their infrastructure as a service market share is under 2%, we ranked Dell Cloud, VMware Cloud, Huawei Cloud, and Baidu Cloud as <2% in market share.
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The 12 Largest Cloud Computing Providers in the World
12. Baidu Cloud AI
Global Market Share in Q3 2022: <2%
Baidu AI Cloud is the cloud computing service of the Chinese internet search company Baidu. According to the company it provides compute & storage, network & CDN, database, big data, and security services. In 2021, Baidu AI Cloud had about 9% market share in China’s Cloud infrastructure services spending market, ranking fourth after Alibaba Cloud, Huawei Cloud, and Tencent Cloud. Because the size of China’s cloud market is significant, Baidu AI Cloud is one of the largest IaaS cloud companies in the world.
11. VMware
Global Market Share in Q3 2022: <2%
VMware cloud infrastructure services is one of the products of VMware, a leading provider of multi-cloud services that enable digital innovation with enterprise control. Originally part of Dell Technologies after the latter acquired EMC Corp in 2015, VMware came from Dell Technologies in November 2021 so that the company could have more strategic flexibility to grow faster through more freedom to get to invest in cloud computing.
10. Dell Technologies
Global Market Share in Q3 2022: <2%
In addition to making PCs, Dell Technologies provides infrastructure as a service with its Dell Technologies Cloud. According to the company, “The Dell Technologies Cloud IaaS model has been invaluable to enterprises. By providing and making servers, storage, networking and other computing resources accessible over the Internet, IaaS offerings enable businesses to reduce the cost and avoiding the complexity of buying. and managing their own infrastructure.”
9. Huawei Cloud
Global Market Share in Q3 2022: <2%
Huawei Cloud is the cloud infrastructure computing service provided by the Chinese technology company Huawei. Given its market share in China, Huawei Cloud could rank higher on this list but we included it at #9 because Synergy Research Group did not rank it among the top eight cloud infrastructure service providers in the world in Q3 2022. According to China Internet Watch, Huawei Cloud had an 18% market share in China’s cloud infrastructure service spending in 2021, more than Tencent Cloud’s 16%, and Baidu AI Cloud’s 9%. However, as the company is private, it is difficult to determine how much market share it currently has but it is certainly among the leaders.
8. Oracle Cloud
Global Market Share in Q3 2022: 2%
Oracle Cloud is the IaaS offering of database and enterprise software maker Oracle Corporation where it has about 2% of the global market share. In fiscal Q2 2023, Oracle Corporation’s IaaS sales rose 53% year-over-year to $1 billion, which is actually slightly faster than overall industry growth. One possible reason for the rapid growth is that TikTok has directed 100% of US user traffic to Oracle Cloud Infrastructure as of June 2022. TikTok previously used its own data centers for US traffic.
7. Tencent Cloud
Global Market Share in Q3 2022: 2%
Tencent Cloud is a cloud computing service provided by the Chinese social media giant Tencent. According to the company, Tencent’s cloud is being used by many software developers from many different industries, including Tencent’s own WeChat messaging application. In terms of market share, Tencent Cloud had a 16% market share in China’s cloud infrastructure services industry in 2021 and a market share of about 2% of the global cloud infrastructure service market in Q3 2022.
6. Salesforce
Global Market Share in Q3 2022: 3%
In addition to being a leading SaaS provider, Salesforce Inc offers a platform as a service solution that allows businesses to easily deploy, run and manage custom cloud applications without building and maintaining their own servers and infrastructure. With the Salesforce Platform and other services, Salesforce has a global market share of 3% in the cloud infrastructure service market in Q3 2022.
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Disclosure: None. The 12 Largest Cloud Computing Providers in the World was originally published on Insider Monkey.
