Despite JEDI loss, AWS maintains its dominant position

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<pre><pre>Despite JEDI loss, AWS maintains its dominant position

AWS has made an effort There was a blow last year when the $ 10 billion JEDI cloud contract with Microsoft was lost. But even without this mega-deal to expand the country's common defense infrastructure, the company remains in full control of the cloud infrastructure market – and intends to fight that decision.

In fact, AWS still has almost twice the market share of the cloud infrastructure as Microsoft. his next rival. While the two will be battling for big jobs like JEDI over the next decade, AWS doesn't have to worry much for now.

The AWS year had much more to offer than just losing JEDI. There have usually been a number of announcements and improvements to the extensive product range in the news. One of the more interesting steps included a move to the fringes, the fact that the company is taking the chip business more and more seriously and is releasing a large amount of machine learning product announcements.

The fact is that AWS has such a dynamic market. It's a legitimate question whether someone, including Microsoft, can catch up. However, the market continues to grow and the next battle is for this remaining market share. Andy Jassy, ​​CEO of AWS, spent more time devastating Microsoft at the re: Invent customer conference in December 2019 than in the past. He asked customers to move to the cloud faster and showed that his company was preparing to fight its competitors in the coming years.

Pay please

AWS ended 2019 at a running rate of $ 36 billion, growing from $ 7.43 billion in the first report in January to $ 9 billion in the last report in October. Believe it or not, according to CNBC, that number didn't meet analysts' expectations of $ 9.1 billion, but it still accounted for 13% of Amazon sales in the quarter.

Regardless, AWS is a juggernaut, which is pretty surprising considering that it started as a side project for Amazon .com in 2006. Indeed, if AWS were an independent company, it would be a substantial business. Although growth has slowed somewhat over the past year, if you grow to AWS size it is inevitable, says John Dinsdale, vice president, chief analyst and general manager at Synergy Research, a company that tracks all aspects of the cloud market ,

"It's just math and the law of large numbers. Over the past four quarters, revenue has increased well over $ 500 million per quarter. Quarterly sales increased well over $ 2 billion in twelve months, ”he said.

Dinsdale added, "To put this in context, this quarterly revenue growth is greater than Google's total cloud infrastructure service revenue. AWS remains in a very large market that is growing at over 35% per year stable. "

According to Dinsdale, the cloud infrastructure market hasn't quite reached $ 100 billion last year, but even without full fourth-quarter results, his company's models forecast a total of around $ 95 billion, up 37% compared to 2018. AWS has more than a third of it. Microsoft is in third place with around 17%, with around 8 or 9%.

While this dates from the first quarter, it shows the relative positions of companies in the cloud market. Graphic: Synergy research

JEDI disappointment

It would be difficult to do an annual review of AWS without discussing JEDI. From the moment the Department of Defense announced its ten-year $ 10 billion cloud RFP, it was one big controversy after another.