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Microsoft Edges Closer to AWS as Cloud Market Growth Decreases

Key Highlights

  • AWS, Microsoft, and Google Cloud continue to dominate the cloud services market, accounting for two-thirds of the global market and almost three-quarters of spending on public cloud.
  • According to a report from Synergy Research Group, the revenue growth rate for global cloud infrastructure services slowed down in the last quarter of 2022. 

Microsoft was the only hyper scaler among the top players to increase its market share, while Google held steady from the previous year at 11%. However, all three leading companies in the market experienced a slowdown in cloud revenue growth in the last quarter of 2022.

AWS’s net sales growth rate declined by eight percentage points from the previous quarter, while Google Cloud’s revenue growth slowed down by five percentage points to 32% compared to the previous quarter. Microsoft Cloud’s revenue growth decreased by two percentage points to 22%.

Reduction In The Growth of Cloud Services

The growth of cloud services saw a slowdown in the last three months of 2022, according to a report. The three major players, AWS, Microsoft, and Google Cloud, accounted for two-thirds of the global cloud market and nearly three-quarters of public cloud spending.

According to John Dinsdale, Chief Analyst at Synergy Research Group, the slowdown in cloud spending growth was expected due to the massive size of the global market. However, there were three other factors that contributed to it, which he mentioned in an email:

  1. The strength of the dollar, which diminished growth rates in non-US markets, pandemic restrictions in China
  2. Increased customer scrutiny over new cloud spending amid an economic contraction
  3. The domestic cloud market grew at a rate of 27%, which is five percentage points higher than the global market.

Read more: Will Home Prices Drop In 2023 In the USA?

Public infrastructure and platform “as a Service” accounted for the largest sector of the cloud market and grew at a slightly higher rate of 22% YoY than all cloud services.

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