Despite clear economic challenges, new Research group Synergy figures show a positive upward trend in the amounts that companies spend on their cloud infrastructure services.
As of the second quarter of 2023, corporate spending on cloud infrastructure services worldwide was $64.8 billion, an increase of $10 billion compared to the same period of 2022 and the third consecutive quarter of growth amid restrictive budgets.
The numbers also reflect positively on Microsoft and Google, both of which have steadily grown in market share over the years.
AWS is still responsible for most cloud services
There was little change in Amazon’s market share, with the cloud division accounting for just under a third of cloud spending. Microsoft and Google were 22% and 11% respectively, bringing the combined share of the three leaders to nearly two-thirds (65%).
Synergy pointed out that the dominance of the three leaders is even more pronounced in the public cloud sector, where they account for 72% of the market.
At the same time, a five-year period shows that IBM’s stock has continued to fall, while Alibaba has also seen a decline despite peaking in 2021.
The analysts blame “macroeconomic pressures, corporate tightening, local market problems in China and… the law of big numbers” for the recent decline in growth rates, but other factors may also be at play .
In recent months, particularly in the first half of 2023, many enterprises have wanted (and now can) create their own AI tools. While many opt for -aaS approaches, others are eager to purchase their own hardware, including industry-leading and expensive processors, which may have pushed cloud spending into the background.
Looking ahead, Synergy sees the current “short term” challenges self-resolving and growth will continue for some time to come.