Amazon, Microsoft, Google accounted for 61% of the total cloud infra services spend in Q2 2021: Report

Our Bureau Mumbai | Updated on August 04, 2021

Organisations across all verticals have been focusing on business resiliency planning due to Covid

The global cloud infrastructure services spending increased 36 per cent to $47.0 billion in Q2 2021, according to the recent data from Canalys.

Expenditure was over $5 billion higher than the previous quarter and over $12 billion more than Q2 2020, the growth led by acceleration in workload migration and cloud native application development.

The top three cloud service providers, Amazon, Microsoft and Google collectively accounted for 61 per cent of the total cloud infrastructure services spend in Q2 2021, the report said.

Owing to the impact of and the challenges posed by the Covid-19 pandemic, over the last 18-months, organisations across all verticals have been focusing on business resiliency planning.

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This has led to acceleration of digital transformation projects and increase consumption and adoption of cloud.

The top three

The top three players accounted for over 60 per cent of the market share.

Amazon Web Services (AWS) was the top cloud service provider in the quarter, accounting for 31 per cent of total spend with a growth of 37 per cent on an annual basis.

Microsoft Azure came in second with a 22 per cent market share. It grew 51 per cent. Google Cloud grew 66 per cent in the latest quarter, accounting for an 8 per cent market share.

Environmental initiatives

As recovery is underway for businesses, extreme weather events and natural disasters in the first six months of this year have raised concerns over the long-term disruption from environmental risks. A call-to-action to make sustainability has been central to post-pandemic investments and improving environmental resiliency, Canalys said.

“Awareness of the energy use and carbon emissions from digital services delivered from data centres operated by cloud service providers is growing. But the leading providers are also at the forefront of environmental resiliency efforts,” said Canalys Research Analyst Blake Murray.

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“The best practices and technology utilised by these companies will filter to rest of the industry, while customers will increasingly use cloud services to relieve some of their environmental responsibilities and meet sustainability goals,” added Murray.

The top three players have also begun efforts in reducing their own carbon footprints and have set aggressive targets to further minimise their future impact.

Amazon has recently announced fourteen new wind and solar energy projects globally

“Currently, 40 per cent of Amazon’s operations run on renewables and it plans to be 100 per cent sourced by 2030. AWS plans to power its operations with 100 per cent renewables by 2025,” as per the report.

Microsoft has been carbon neutral since 2012. It is aiming to become carbon negative and water positive by 2030. The tech giant is also planning to produce zero waste by 2030, with its circular centres repurposing or reusing servers and other hardware from its data centres.

“Microsoft is also innovating with underwater data centres and hydrogen fuel cells, and plans for its data centres to be 100 per cent powered by renewables by 2025,” it added.

Google achieved carbon neutrality in 2007. As of 2020, the tech giant had announced that it had eliminated all its historic carbon emissions through the purchase of offsets. It has set a target to run all data centres and campuses on renewable energy by 2030.

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“Regulation from governments, especially those tied to the Paris Agreement, will continue to intensify, while an increasing share of cloud services contracts will have sustainability requirements built in,” said Canalys Chief Analyst Matthew Ball.

“Customers will continuously evaluate their cloud service providers and use multi-cloud strategies to achieve the lowest carbon footprint. However, transparency in measurement of sustainable practices will have to improve,” Ball added.

Canalys defines cloud infrastructure services as services that provide infrastructure as a service and platform as a service, either on dedicated hosted private infrastructure or shared infrastructure. This excludes software as a service expenditure directly, but includes revenue generated from the infrastructure services being consumed to host and operate them.

Published on August 04, 2021

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