Synergy’s latest research data shows that in the fourth quarter of 2020, companies spent more than US$37 billion on cloud infrastructure service providers, US$4 billion higher than the previous quarter, and an increase of 35% compared to the fourth quarter of 2019. It is worth noting that this is the second consecutive quarter that the market has grown at such a rate year-on-year, which is unusual for such a large high-growth market. The market has doubled in size in just nine quarters.  Geographically, the cloud market in all regions of the world continues to grow strongly.

Amazon and Microsoft continue to occupy more than half of the global market, while Microsoft is further approaching Amazon, a larger competitor, reaching the milestone of 20% global market share. In the past four years, Microsoft, Google and Alibaba have steadily expanded their market share, but the leader Amazon has not lost share. In the past four years, Amazon’s market share has remained between 32%-34%. The loss in market share is a large number of smaller cloud service providers whose market share has fallen by 13 percentage points in the past 16 quarters. In the long list of small cloud providers or large companies with a small market share, the more prominent ones are IBM, Salesforece, Tencent, Oracle, NTT, Baidu, SAP, Fujitsu and Rackspace.

Currently, most mainstream cloud service providers have released fourth-quarter earnings data.  Synergy estimates that in the fourth quarter, revenue from cloud infrastructure services (including IaaS, PaaS and managed private cloud services) was US$37.1 billion, driving the full-year market revenue of 2020 to US$129 billion. Public IaaS and PaaS services accounted for most of the market, increasing by 36% in the fourth quarter. The dominant position of mainstream cloud providers is more obvious in the public cloud field, with the top five controlling 80% of the market share.

Synergy Chief Analyst John Dinsdale said: “At the end of 2020, the cloud market ushered in a big explosion. Compared with the third quarter, the market jumped 4 billion US dollars, easily setting a new growth in cloud provider revenue record. Amazon and Microsoft outperformed the overall market. In the past 16 quarters, Amazon’s market share has remained above 30%, while Microsoft’s market share has increased from 10% to 20%. However, except for these two companies, the remaining companies are still growing at an annual rate of more than 30%, which provides growth opportunities for many smaller cloud providers.”