Cloud infrastructure spending hits $42bn worldwide

Cloud infrastructure spending hits $42bn worldwide

Spending on global cloud infrastructure services increased 35% in the first quarter of 2021 to a record of US $41.8 billion as businesses leaned heavily on the internet in the wake of the pandemic, said a study.


Spending on “cloud infrastructure services” around the world was up nearly US$11 billion higher than in Q1 2020 and nearly US$2 billion more than in Q4 2020, revealed the study by the market tracker Canalys.

Cloud infrastructure continues to establish its global importance due to a surge in emerging technologies such as machine learning, data analytics, application migration, and cloud-native development, according to Canalys. 

"The acceleration of digital transformation over the last 12 months, with organizations adapting to new working practices, customer engagement, and business process and supply chain dynamics, has elevated demand for these services. This, combined with the rebound in some economies, in line with government stimuli, the roll-out of mass COVID-19 vaccination programs and the subsequent easing of restrictions, has increased customer confidence in committing to multi-year contracts," it explained.

Amazon Web Services (AWS) was the leading cloud service provider in Q1 2021, growing 32% on an annual basis to account for 32% of total spending.

Microsoft Azure grew 50% for the third consecutive quarter, taking 19% market share in Q1 2021.

Google Cloud maintained its momentum, benefiting from its Google One approach driving cross-sell and integration opportunities across its portfolio.
“Cloud emerged as a winner across all sectors over the last year, basically since the start of the COVID-19 pandemic and the implementation of lockdowns. Organizations depended on digital services and being online to maintain operations and adapt to the unfolding situation,” said Canalys Research Analyst Blake Murray.

“Though 2020 saw large-scale cloud infrastructure spending, most enterprise workloads have not yet transitioned to the cloud. Migration and cloud spend will continue as customer confidence rises during 2021. Large projects that were postponed last year will resurface, while new use cases will expand the addressable market,” Murray added.

Investment at the edge, including 5G, is a key area, especially for the development of ultra-low latency applications and use cases, such as autonomous vehicles, industrial robotics, and augmented or virtual reality, said the report.


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