AWS Update: Bull and Bear Analysis

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Executive Summary

It is no secret that Amazon continues to dominate the hyperscale cloud infrastructure sector. Our numbers from earlier this year show Amazon still owning just over 50% of the global hyperscale cloud market. While that share is likely to come down over time, Amazon will continue to hold a meaningful lead on the competition. And this is in the context of a rapidly growing pie in its early stages of development. Even as Amazon loses share on an overall percentage basis, its strong performance guarantees substantial growth in absolute terms.

The question many are starting to ask: is Amazon’s lead insurmountable and will it continue to dominate cloud into the foreseeable future?
This report delves into that crucial big picture question by taking a closer look at all the various arguments for and against Amazon’s sustained dominance. The findings are not necessarily conclusive. The market continues to shift and evolve and things are not standing still. But overall, we found there seems to be slightly more ammunition for the bearish point of view.

We say this while recognizing our methodology here is not necessarily scientific. There are points for the bears and for the bulls. And each of the points for and against should not be considered equal in weight. But our analysis suggests that the competitive dynamics will definitely change over time. That does not mean things will look drastically different. The shifts likely to take place will be a bit more nuanced and the world will look something like the one painted in the numbers we presented in our Hyperscale Marketshare Report earlier this year and here in the report below. The bottom line: AWS dominance in its current form will not continue as the market continues to play out.