- Powered by its private and hybrid cloud, Microsoft has overtaken Amazon Web Services (AWS) in the cloud market when measured by recurring subscription revenue, according to a Seeking Alpha report. AWS remains the leader in the public Infrastructure as a Service (IaaS) market.
- In an analysis of Microsoft's cloud revenue, Seeking Alpha found the company has a heavy presence across all market segments, participating across more parts of the market than other cloud providers. While it is difficult to uncover all aspects of the cloud Microsoft has a presence in, Seeking Alpha focused on its IaaS, PaaS and SaaS products.
- Microsoft's reported commercial cloud revenue was $4.7 billion, while AWS brought in $4.1 billion in the most recent quarter of 2017, according to the report. Microsoft's dominance is set to increase with its heavy Dynamics 365 investments as well as resources put into its infrastructure services. Its lead excludes revenues earned from hardware and services.
Microsoft's true dominance comes from its successful migration of existing customers to the cloud, whether that's through Office or other products. It's safe to say AWS is still the clear leader in the IaaS space, but Microsoft has worked to move into all parts of the cloud, acknowledging the different facets of technology in the modern market.
Even in the infrastructure space Microsoft is making headway, holding 11% of the market share in Q2. While that seems small compared to AWS' 34% share, Microsoft's share is up whereas AWS slipped from 40%.
For Microsoft, it's all about product diversity. A longtime powerhouse in the enterprise market, thanks to its work with Windows, the company has made its entire product suite cloud-ready. Dynamics 365, for example, is dominant in the ERP space, overtaking market leaders like Oracle and SAP.
When CEO Satya Nadella joined the company, the focus was on making Microsoft products "mobile first, cloud first." But now Microsoft has accomplished that. All that's left now is for Microsoft to continue to mature its product suite while preparing for the intelligent era. Microsoft has already signaled this with its push to make everything AI, a focus which was emphasized in its recent filings.