According to the recent data from Synergy Research Group, Microsoft’s cloud infrastructure grew by over 154% YoY which is almost 2.3 times faster than Amazon Web Services which recorded 67% growth. Amazon is still the cloud infrastructure business leader with 27% market share which is more than all the next 5 five competitors combined. IBM, Salesforce and Google are trailing behind Microsoft(8%) in which IBM, Salesforce, and Google, have 6.5%, 6%, and 4.5% share of the market, respectively.
AWS has been forcing the cloud market to slash their margin every other quarter. Microsoft has been forced to reduce the price of their services in an effort to match the prices of Amazon. Given Microsoft’s strong brand among the enterprise, Microsoft is positioned better to compete against Amazon than anyone else.
Microsoft Azure made price cuts that matched AWS’ cuts in many categories, and exceeded it in several others. The software giant chopped computing prices by 27%-35% and storage by 44%-65%. Additionally, Microsoft cut the pricing for Windows instances by 27% and memory-intensive Linux instances by 35%.
Microsoft also reported that it was lowering the prices of Block Blob storage by 65% for LRS, or locally redundant storage, and 44% for GRS, or geo-redundant storage.
With the drastic price cuts, Microsoft is now in an excellent position to challenge AWS’ leadership in cloud services. Although Microsoft’s cloud is still less than one-third the size of AWS, it would take only 6-7 years to catch up, in terms of size, assuming that it grows at a rate of 80% for the next 7 years and AWS grows at only 50%. Faster growth for Microsoft’s cloud could cut that time to as little as 4-5 years.
Thanks to JamesSB for the heads up!