Published On: Wed, Dec 23rd, 2020

With a $50B run rate in reach, can anyone stop AWS?

AWS, Amazon’s flourishing cloud arm, has been flourishing during a quick shave for some-more than a decade. An early open cloud infrastructure vendor, it has taken advantage of first-to-market standing to turn a many successful actor in a space. In fact, one could disagree that many of today’s startups wouldn’t have gotten off a belligerent but a arrangement of cloud companies like AWS giving them easy entrance to infrastructure but carrying to build it themselves.

In Amazon’s most-recent gain report, AWS generated revenues of $11.6 billion, good for a run rate of some-more than $46 billion. That creates a subsequent AWS miracle a run rate of $50 billion, something that could be in strech in reduction than dual buliding if it continues a gait of income growth.

While a cloud division’s expansion is negligence in commission terms as it comes resolutely adult opposite a law of vast numbers in that AWS has to grow each entertain compared to an ever-larger income base. The outcome of this energetic is that while AWS’ year-over-year expansion rate is negligence over time — from 35% in Q3 2019 to 29% in Q3 2020 — a gait during that it is adding $10 billion chunks of annual income run rate is accelerating.

At a AWS re:Invent patron discussion this year, AWS CEO Andy Jassy talked about a gait of change over a years, observant that it took a following series of months to grow a run rate by $10 billion increments:

123 months ($0-$10 billion) 23 months ($10 billion-$20 billion) 13 months ($20 billion-$30 billion) 12 months ($30 billion to $40 billion)

Image Credits: TechCrunch (data from AWS)

Extrapolating from a above trend, it should take AWS fewer than 12 months to scale from a run rate of $40 billion to $50 billion. Stating a obvious, Jassy pronounced “the rate of expansion in AWS continues to accelerate.” He also took a time to indicate out that AWS is now a fifth-largest craving IT association in a world, forward of craving stalwarts like SAP and Oracle.

What’s extraordinary is that AWS achieved a scale so fast, not even existent until 2006. That expansion rate creates us ask a question: Can anyone wish to stop AWS’ momentum?

The brief answer is that it doesn’t seem likely.

Cloud marketplace landscape

A good place to start is contemplating a cloud infrastructure opposition landscape to see if there are any cloud companies that could locate a marketplace leader. According to Synergy Research, AWS stays resolutely in front, and it doesn’t demeanour like any aspirant could locate AWS anytime shortly unless some marketplace energetic caused a extreme change.

Synergy Research Cloud marketshare leaders. Amazon is first, Microsoft is second and Google is third.

Image Credits: Synergy Research

With around a third of a market, AWS is a transparent front-runner. Its closest and fiercest opposition Microsoft has around 20%. To put that into viewpoint a bit, final entertain AWS had $11.6 billion in income compared to Microsoft’s $5.2 billion Azure result. While Microsoft’s homogeneous cloud series is flourishing faster during 47%, like AWS, that series has begun to dump usually while it gains marketplace share and aloft income and it falls plant to that same law of vast numbers.

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