Why is AWS dominating the Cloud Market
Cloud computing has boomed over the past several years. Businesses are increasingly transitioning to different cloud services. As a result, the Cloud computing market is rising, offering incredible opportunities for cloud providers to gain leadership in this segment.
The leaders in cloud computing in 2021 are Amazon and Microsoft, followed by Google, Alibaba, and IBM. One company leading the cloud market arena for almost a decade is Amazon Web Services (AWS). In 2020 AWS was named as the Cloud leader for the 10th consecutive year in Gartner’s Infrastructure & Platform Services Magic Quadrant.
Microsoft, Google, IBM, Alibaba, and Oracle demonstrate sustainable growth. Nonetheless, Amazon’s revenues are still higher than the other five combined. So, why does AWS still heavily dominate the cloud market niche?
1. Powerful start
Starting as an e-commerce company, Amazon has faced a challenge to create a platform that third parties could use for making online shopping sites. In 2006 Amazon Web Services (AWS) emerged and shaped the public cloud industry. Developers used AWS to test and build apps. The emergence of AWS came from the philosophy of a “virtuous cycle” that begins with getting customers, increasing the number of clients, and adding more servers and features. When Amazon adds more servers and features, customers enjoy lower prices, and Amazon gains even more customers. Amazon’s main competitor Microsoft launched its platform Azure in 2010, but by that time Amazon already has gained leadership and still rules the cloud market.
2. Price optimization
AWS has cut prices more than 50 times since its launch in 2006. The more network expansion AWS experiences, the greater scale enables to offer customers lower prices. According to TechCrunch, “While AWS might not have the eye-popping growth percentages of its rivals, it still grew at a decent 47 percent, with earnings of $3.53 billion on an astonishing $14.2 billion run rate”.
3. Cutting-edge technologies and innovations.
Because of its strong start in 2006, AWS managed to shape a massive customer base, allowing the company to better insight into customers’ needs when it comes to Cloud. AWS has better visions than almost any vendor into how customers use cloud services. Therefore, they stay abreast of creating new infrastructures and innovations to meet its customer needs and support Amazon around the world.
No wonder that AWS continues to dominate the cloud computing market. Even though Microsoft and Google demonstrate a higher quarterly growth, Amazon’s quick initiative in its early years, price drops, improvements in infrastructure, constant innovations, and fast and easily scalable solutions allow the company to remain the leader in cloud computing. However, to keep this position, AWS must be fast and innovative when implementing platforms for artificial intelligence. So, in the years to come, the competition promises to be exciting.