cloud-market-shares

Cloud Market Shares

In 2021, Alphabet’s (Google) Cloud Business was an over $19 billion unit within Alphabet’s Google overall business model; to gain a bit of context, Microsoft intelligent cloud netted $60 billion, and Amazon AWS netted over $62 billion in the same year.

Revenue StreamsRevenuesOperating Income
Amazon AWS$19.7B$5.7B
Microsoft Intelligent Cloud*$20.9B$8,7B
Google Cloud$6.27B-0.858B

The cloud business is among the most interesting industries of the last decade. Powering up a whole B2B and entperise ecosystem the cloud business has enabled the so-called Web2 or Web 2.0.

Indeed, when AWS officially launched, back in 2006, it was rolled out first as a Simple Storage Service, or S3, on March 14, 2006. 

Over time it became a powerhouse which enabled hundreds of startups, and some of them became tech giants.

Indeed, still as of 2022, most of Netflix’s content is hosted on AWS.

Netflix never built its own data centers (today, Netflix is mostly hosted on Amazon AWS).

netflix_arch_diagram
Amazon AWS infrastructure and architecture, which hosts Netflix’s content platform.

Therefore, the cloud business has been tied to the startup world for the last decade and it has actually empowered it.

Today, many tech startups worth billions have their whole infrastructure built on top of cloud providers like AWS and Azure.

That is how AWS has turned into a juggernaut. A company generating over $62 billion in revenues, by 2021, with astounding profit margins.

amazon-aws-business-model
Amazon AWS follows a platform business model, that gains traction by tapping into network effects. Born as an infrastructure built on top of Amazon’s infrastructure, AWS has become a company offering cloud services to thousands of clients from the enterprise level, to startups. And its marketplace enables companies to connect to other service providers to build integrated solutions for their organizations.

Initially the other key player in the cloud industry, Microsoft didn’t manage to successfully pick up traction, until the company re-focused its strategy toward cloud.

Today, cloud services are a key part of the overall Microsoft business model.

microsoft-business-model
Microsoft has a diversified business model, spanning from Office to gaming (with Xbox), LinkedIn, search (with Bing), and enterprise services (with GitHub). In 2021, Microsoft made over $168 billion in revenues, of which over $52 billion came from Server products and cloud services and $39.8 billion came from Office products and cloud services. Windows generated over $23 billion, Gaming generated over $15 billion, LinkedIn over $10 billion, and search advertising (through Bing) over $8.5 billion. 

Not only Microsoft had to move its main productivity offering (Microsoft Office) in the cloud, to adapt to the new market context.

But it also had to employ an aggressive market entry strategy for Azure, which has now become a key competitor to AWS.

Read Next: Microsoft Business Model, Who Owns Microsoft?, Microsoft Organizational Structure, Microsoft SWOT Analysis, Microsoft Mission Statement, Microsoft Acquisitions, Microsoft Subsidiaries, Bill Gates Companies.

Read Next: Google Business Model, Google Subsidiaries, What Happened To Google Glass?, What happened to Google Plus?, How does Google Maps make money?, Who Owns Google?, How Does YouTube Make Money?, History of Youtube, How Do YouTubers Make Money?

Read Next: Amazon Business Model (2022 Update), Amazon Flywheel, Amazon Mission Statement and Vision Statement, Is Amazon Profitable Without AWS?, Amazon Revenues Breakdown 2015-2021.

Scroll to Top
FourWeekMBA