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Home Technology Infrastructure & Platforms Cloud, Virtualization, Operating Environments and Middleware

IaaS generates $200K in revenue every minute

FutureCIO Editors by FutureCIO Editors
February 27, 2021
Photo by Manuel Geissinger from Pexels

Photo by Manuel Geissinger from Pexels

The 650 Group report, IaaS Hyperscaler SWOT Report 2020-2025, IaaS revenue grew to over $100 billion in 2020 and $50 billion in capital expenditures for data centre equipment (servers, storage, networking) and other compute and IT equipment. 

Amazon AWS, Microsoft Azure, and Google GCP made up over 60% of the revenue with Alibaba being the largest non-US provider.

AWS brought in $86,000 per minute in revenue and made $26,000 per minute in profit (30%) dollars.  While GCP, in third place, brought in $3,300 per minute in revenue while losing $1,400 per minute in 2020.  Additionally, 2020 saw Alibaba record its first profitable quarter.

"While revenue continues to surge for IaaS as many businesses rely on it as a foundational building block for their data, profit dollars remain challenging as companies look to grow and expand instead of relying solely of profit to make investment decisions," said Alan Weckel, founding technology analyst at 650 Group.

Continued Weckel: "2021 is shaping up as an important battle of US IaaS hyperscalers as they invest to their strengths to continuing expanding.  The battle for Artificial Intelligence (AI/ML) with IaaS providers is presently in its infancy with many suppliers vying for position for the underlying technology."

To validate this strategy of growth over profitability, Canalys reported that Alibaba Cloud grew 54% in Q4 2020. Its Hybrid Cloud Partner Program and on-premises appliances target small and medium enterprises offering partners the ability to plan, design and reseller Alibaba Cloud services with a free license and unlimited CPU cores.

Canalys research analyst Blake Murray said the cloud is leading the accelerating pace of digitalization.

“Large projects that were postponed earlier are being re-prioritised, led by application modernisation, SAP migrations and workplace transformation.”

He adds that enterprises are diverting investments to cloud, opening up new revenue streams and diversifying business models.

Related:  Differentiated cloud services are a must for growth into 2023
Tags: 650 GroupAmazon AWSCanalysGoogle CloudhyperscalersIaaSinfrastructure as a serviceMicrosoft Azure
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