The Synergy Research Group analyzed Q1 data and found that Microsoft is now number two in cloud infrastructure services, behind Amazon. More interesting is how fast Microsoft is catching up.

Amazon’s cloud still plays in its own league, with a market share greater than its four closest rivals (Microsoft, IBM, Salesforce, and Google). However, if you look at the Year over Year (YoY) growth rate, Microsoft clearly beats Amazon.

Microsoft’s YoY growth was a whopping 154 percent, whereas Amazon grew “only” 67 percent. IBM is now also growing faster than Amazon, with YoY growth of 80 percent. Last year, when I wrote a blog post about the growth rate of Amazon’ cloud, I wondered if the competitors of the cloud primus had a chance of catching up. I think we have the answer now. Microsoft is coming closer in great strides.

Cloud Infrastructure Services Q1 2014 - Synergy Research Group

Cloud Infrastructure Services Q1 2014 - Synergy Research Group

We can attribute the growth of Microsoft’s cloud in part to an excellent marketing strategy. I saw a nice commercial about the Microsoft cloud (was it CNN?) a few days ago, and Nadella doesn’t pass up an opportunity to stress the cloud ambitions of the Redmond software giant. He replaced Ballmer’s talk about “services” with the “cloud,” which was an important strategic move. I believe that it encouraged many Microsoft shops to have a closer look at Azure to see what this buzz about the cloud is all about.

Nevertheless, a strong marketing effort doesn’t really help if the product behind it is weak. There is no doubt that Microsoft Azure is a great product. Azure is still technically behind AWS, but Microsoft made enormous progress. Many Windows shops obviously prefer Azure over AWS because they accredit more Windows competence to Microsoft.

It is interesting to note that only IaaS and PaaS market shares were considered in the study. Thus, if we include the numbers of Office 365, which belongs in the SaaS realm, Microsoft would appear even closer to Amazon because the online retailer has nothing to offer that could compete with Office 365.

However, Microsoft benefited from the fact that private cloud market shares were also considered in the study. Private and hybrid cloud offerings are not the strength of AWS. Nevertheless, if Microsoft can keep up this growth rate, we will soon see a neck-and-neck race between the retailer and the software maker for dominance in the cloud.

It will be interesting to see how Amazon will react to Microsoft’s amazing progress. Thus far, Windows only played a minor role in AWS. I think if Amazon is serious about staying ahead of the pack, it has to offer better Windows support. Perhaps WorkSpaces was already a step in this direction. By the way, I just received notice that WorkSpaces is now available in the AWS EU (Ireland) region.

One thing is for sure: the growth rates of all cloud providers are staggering. If you, as an IT pro, still don’t have experience in the cloud, it is about time to get started.

  1. Padraig 8 years ago

    Biggest problem for me with Microsoft cloud (a la Office 365 SBP ) is lack of two factor authentication .Seems to me that is simply not an option without 2FA can't understand why it is not available.( but incredibly is available on the consumer version

  2. I didn't try it, but I read that Office 365 and Azure support Multi-Factor Authentication.

  3. Padraig 8 years ago

    Yes but not for Small Business Plans ?

  4. Anne 8 years ago

    It looks like MS has multifactor auth available at an inexpensive price.

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