Cloud computing spending breaks all records in 2019

AWS retains its lead but Microsoft Azure and Google Cloud are growing fast

Organizations worldwide spent a record $107bn on cloud computing infrastructure services last year according to a new report from Canalys.

Spending on cloud computing infrastructure services was up by 37 percent compared to the previous year and a third of this year’s spending went to Amazon’s cloud computing division, AWS.

As industries continue to digitize, businesses have increased how much they spend on infrastructure as a service (IaaS) as well as their investments in servers, storage, compute and other cloud-based services. According to experts at Canalys, this uptick in spending will likely continue over the next five years and the firm’s report estimates that total spending on cloud infrastructure services will reach $284bn in 2024.

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In a press release, chief analyst at Canalys, Alastair Edwards credied this increase in cloud computing infrastructure spending to the fact that many organizations outside of the tech space are now transitioning to become technology providers, saying:

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“Organizations across all industries, from financial services to healthcare, are transitioning to being technology providers. Many are using a combination of multi-clouds and hybrid IT models, recognizing the strengths of each cloud service provider and the different compute operating environments needed for specific types of workloads.”

Cloud spending
According to Canalys’ report, organizations spent $34.6bn on AWS’ cloud infrastructure which is up from $25.4bn the previous year. At the same time, Amazon’s market share increased slightly from 32.7 percent in 2018 to 34.6 percent last year with an annual growth rate of 36 percent.

While AWS took the top spot, Microsoft Azure came in second with customers spending 18.1bn last year up from 11bn in 2018. Azure’s market share also increased from 14.2 percent to 16.9 percent in 2019 and Microsoft’s cloud computing division saw an annual growth rate of 63.9 percent.

Google Cloud surpassed Alibaba Cloud and other cloud providers to earn the third spot with $6.2bn spent by its customers during 2019. The search giant’s cloud computing division saw spending almost double from the $3.3bn spent in 2018 and it also saw an impressive 87.8 percent increase in annual growth.

Edwards also highlighted the role that channel partners will play in the future of cloud computing, saying:

“The role of channel partners will become more important, as cloud use increases, in terms of defining application strategies, integration into business processes, optimizing user experiences, governance and compliance, as well as securing data and workloads.”

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