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Who has the biggest cloud? By year’s end, the answer may surprise you.

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Amazon(s amzn) Web Services remains the biggest of the big cloud providers, but it’s seeing competitors gaining in its rear-view mirror.  Nomura Securities analyst Rick Sherlund now expects Microsoft(s msft) to field the largest cloud business by December — at least in terms of annual revenue run rate which he estimated will be $5.77 billion.

In a research note, Sherlund, who has covered Microsoft on and off for years, said that revenue estimate would represent 89 percent year-over-year growth for that business. In terms of run rate, he ranked crm) as the second largest provider at $5.5 billion and 28 percent growth year over year.

This is a tricky calculation for a few reasons, not least because AWS, the world’s largest cloud infrastructure provider, does not break out its numbers. Actually, none of the cloud providers make it easy to assess the size of their businesses. Microsoft, for example, seems to lump Azure, Office 365 Software-as-a-Service (SaaS) business all together. Still, given that rather large caveat, Sherlund estimates that Amazon’s cloud business run rate would be comparable to’s.

Another wrinkle is that this is not an apples-to-apples comparison.’s business is mostly SaaS with some Platform as a Service (PaaS) sales from and Heroku. AWS, on the other hand, is typically defined as Infrastructure as a Service (IaaS). Microsoft Azure started out four years ago as a PaaS but last year added AWS-like IaaS capabilities.

Purists prefer to break out all those categories separately, but for non techies those roles are muddled. For example, Synergy Research Group’s recent figures which combine IaaS, PaaS and SaaS into one big blob, show Microsoft and IBM growth rates in the second quarter of 2014 (164 percent and 86 percent respectively) outstripping AWS growth (49 percent), Google (47 percent) and (38 percent).

For context, note that AWS remains the largest cloud provider per Synergy, but it is no longer bigger than all four of its nearest competitors combined (see chart.)

For Amazon’s recent second quarter, net sales for the category including AWS grew 38 percent year over year, to $844 million but were off 3 percent sequentially. And the growth rate declined from 60 percent for the previous quarter.

synergy q2

AWS remains the go-to cloud for many, many shops, but as Gigaom has reported, it’s seeing increased competition in price from Microsoft and Google on the public cloud front. The company has several years’ head start on competitors who do not yet rival the breadth of services Amazon offers, the latest being new domain registration services in its Route 53 Domain Name Service (DNS) and enhancements to its Trusted Advisor service.

But pretty much everyone can agree that when it comes to cloud providers, this is now a horse race. Here’s our look at who could take on AWS circa 2012.

This story was updated at 8:40 a.m. PST to reflect that Microsoft’s cloud business includes more than Azure and that none of the cloud providers make it easy to figure out how big their cloud business actually is.


16 Responses to “Who has the biggest cloud? By year’s end, the answer may surprise you.”

  1. Per NSA PRISM revelations, Microsoft Cloud services & Google Cloud services have Backdoor Access……….Once your Data is in the Cloud, the Vendor OWNS your Data…….

  2. sourcesforstories

    Is it the horse race that matters or how well all of these individual clouds work together and in conjunction with a company’s private cloud offerings? I think interoperability and the ability to move data from one cloud entity to another is going to matter far more in the end! Widespread operating model transformation — it’s got to happen!


  3. Per NSA PRISM revelations, Microsoft public cloud servers (Office 365) & Google public cloud servers have Backdoor Access……….go ahead GIVE your data to Microsoft or Google…They will OWN your data and of course NSA will have the Backdoor Access.

  4. David Card

    I have a personal Office 365 license. Other than the fact I “subscribe” to it, it has nothing in common with SaaS cloud services. I use it for nothing cloud-related: It works fine offline, it hogs my local disk drive, I don’t store anything in the cloud, etc. etc.

    Is this the exact opposite of hosting services “cloudwashing” their branding, or is it exactly the same?

    • I think Office 365 home and personal editions are the exception to the Office 365 is cloud rule. From Microsoft SEC docs:

      Commercial Other, comprising: Enterprise Services, including Premier Support Services and Microsoft Consulting Services; Cloud Services, comprising Office 365, excluding Office 365 Home and Office 365 Personal (“Commercial Office 365”), other Microsoft Office online offerings, Dynamics CRM Online, and Microsoft Azure; and certain other commercial products and online services not included in the categories above.”

  5. Ian Waring

    Better stat would be the population of hosts in each provider, which still shows Amazon streets ahead, and Digital Ocean coming up the rails. As to Microsoft, beware – see :

    Microsoft’s most recent growth in hostnames since mid-2013 has, for the most part, been caused by a large number of Chinese linkfarms (泛站群). The sites in question provide advertising for gambling sites, online product listings, and normally make use of affiliate schemes. Yet they are hosted in the USA, on generic TLDs such as .com and .net to bypass China’s TLD and internet content provider (ICP) license requirements. Unusually, each linkfarm makes use of a reasonably large number of domains and IP addresses, presumably making them harder for search engines to evade. This would normally be cost prohibitive for this kind of activity, however hosting and domain packages can be found advertised on auction sites specifically for this purpose, with packages of (random/unspecified) .com domains available for as little as Â¥17 (~ £2 / $3) each, guaranteed to remain yours for at least a month. It is not clear why IIS has been chosen for these sites, however it does have a considerably higher market share (for all of our metrics) in China compared to worldwide – for example 59% of domains hosted in China use IIS compared to just 29% worldwide.

  6. Agree with Rich. Biggest cloud construes more about size than revenue. Would also be interested how many customers each of these companies have. For ex: how much of Microsoft cloud business is just cannibalistic? etc. just like their surface “tablets” are cannibalistic to their PC business.

  7. Rich Hintz

    When I see “biggest cloud” I think available resources such as machine, storage, and network capacity, not financials like most revenue or most profit. Maybe this is just me.

  8. Looks like IBM has a bigger cloud than Google and they are growing much faster than Google. Maybe when articles are written about the cloud the big three that get mentioned should be Amazon, Microsoft and IBM?

    I always see Google mentioned as a big cloud provider and hardly ever IBM. Weird!

  9. Dave Ohara

    Amazon’s strategy to say as little as possible about its AWS revenue creates the opportunity for companies like Microsoft and IBM to market their size and relevance to the Cloud market. As Microsoft and IBM are able to win customers at some point Amazon may figure out the lack of reporting hurts their credibility.

    In 2008, Google choose to disclose its data center PUE when Microsoft was grabbing media attention from their disclosure of data center PUE numbers. It is more difficult to build credibility when your strategy is to hide details when your competitors are sharing.

    On the other hand if we did see the AWS revenue numbers, maybe they are not as good as we are lead to believe. AWS may have something to hide.