The global infrastructure as a service (IaaS) market grew by 29.5 per cent in 2017 to total $23.5bn, up from $18.2bn the previous year, according to new data from the research firm Gartner.
Amazon was the the top vendor in the IaaS market in 2017 followed by Microsoft, Alibaba, Google and IBM. However, the top four vendors represent approximately 73 per cent of the total IaaS market and 47 per cent of the combined IaaS and infrastructure utility services (IUS) market.
When it comes to the worldwide IaaS market, Amazon is the clear leader with an estimated $12.2bn in revenue during 2017 which is 25 per cent increase from 2016. The company is also the most mature with the strongest track record of customer success and the most useful partner ecosystem.
The IaaS market's growth in 2017 was driven not only by customers moving from traditional data centres to cloud IaaS but also by businesses' digital transformation efforts.
Microsoft earned the number two position with growth of more than 98 per cent on its IaaS offering earning more than $3.1bn in revenue in 2017. The company's IaaS capabilities are delivered through its Microsoft Azure Offering which is made up of a collection of infrastructure and platform services.
Alibaba came in third with 63 per cent growth in 2017 as a result of its successful investment in R&D. The Chinese firm has the financial capability needed to continue this trend with increased global expansion which could one day allow it to overtake both Amazon and Microsoft in select regions.
Research Director at Gartner, Sid Nag offered more details on IaaS adoption in 2017, saying:
"The top four providers have strong IaaS offerings and saw healthy growth as IaaS adoption is being fully embraced by mainstream organisations and as cloud availability expands into new regions and countries. Cloud-directed IT spending now constitutes more than 20 per cent of the total IT budget for organisations using cloud. Many of these organisations are now using cloud to support production environments and business-critical operations."
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