Amazon Web Services, for another consecutive year, is running away with the IaaS cloud market, according to research firm Gartner, but unlike other years the competition - namely Microsoft, is giving the market leader a run for its money.
Gartner released its IaaS Magic Quadrant today outlining the IaaS market; it's hailed by some as a sort of benchmark for the industry to determine who is leading it. Perhaps the most surprising statistic in the report though is just how big AWS is. Gartner estimates that AWS has five times the compute capacity than all of the 14 other vendors analyzed in the report combined.
AWS is clearly the market leader in IaaS, Gartner says, calling the company a thought leader, extraordinarily innovative, exceptionally agile and responsive to the market. Its pure-play cloud offering is suitable for any virtualized workload or environment, although highly secure or compliant workloads require extra attention to architect correctly in the public cloud.
If there are any concerns with AWS, it is that the company may be growing too fast. It's intense popularity means that its sales staff is strapped and customers need to pay extra - up to 10% of their bill on average - to receive enterprise-grade support, leaving customers who do not pay for this charge unsatisfied with their consultation from the company. Its granular pay-as-you-go pricing structure can make for complicated billing too. "AWS currently has a multiyear competitive advantage, but is no longer the only fast-moving, innovative, global-class provider in the market," the report states. Microsoft is catching up.
Azure is ideal for Microsoft-centric IT organizations, but its biggest advantage over AWS may be the interoperability between the public cloud and its suite of on-premises software, such as Windows Server, Systems Center, Hyper-V and Active Directory, which are the components that can be used to build a private cloud that sits inside a company's firewall.
"Microsoft's brand, existing customer relationships, history of running global-class consumer Internet properties, deep investments in engineering, and aggressive road map have enabled it rapidly to attain the status of strategic cloud IaaS provider," Gartner says. "It is second in terms of cloud IaaS market share -- albeit a distant second -- but far ahead of its smaller competitors."
But there are reasons Microsoft isn't first in this market. AWS has the first-mover advantage of its cloud having been up and running for years. Azure is slightly newer so there are feature gaps, although Microsoft is closing those quickly. Gartner says these are most notable in networking and security functionality. Multiple services are still in "preview" with no timetable as to when fuller functionality will be built out. And AWS has a larger partner ecosystem of SaaS applications, optimization services and plug-ins that are built to run seamlessly on AWS's cloud; Microsoft is still building up its partner network.
Behind these two behemoths, there is everyone else in the market. There is no lack of providers in this market, but they all have their pros and cons. CenturyLink, for example, is a solid contender having bought Savvis and even more recently acquiring Tier 3, both IaaS-focused companies. Armed with a solidly engineered offering the company should be able to compete for enterprise workloads, but Gartner warns that over the long haul CenturyLink will be challenged to match the investments that AWS, Microsoft and Google will be able to make on their platforms.
CSC was a top contender in last year's Magic Quadrant but has lost some favor in this year's ranking. Gartner says the company does a good job at enabling enterprise workloads to run in a cloud environment. But, with the company's acquisition of ServiceMesh - which provides services for deploying workloads to multiple providers - CSC is becoming more of a cloud broker to competing clouds like AWS, Azure and others. Gartner questions what that will mean for CSC's internal resources being devoted to its cloud operations.
Google is seen as a strong contender, but its offering is relatively new and lacks features many mainstream enterprises may be looking for, and it has no hybrid cloud strategy, Gartner says. Verizon has a strong IaaS platform, and a network to back it up, but it's launching a new service at some point this year that is not generally available yet, so that too is young.
IBM is seen as a strong competitor too, especially given the company's acquisition of SoftLayer. But Gartner says IBM is "cloudwashing" its SoftLayer bare-metal dedicated hosting offering as cloud, and it says the company will have to differentiate on higher-level services compared to the commodity infrastructure offerings from SoftLayer. Those companies are each listed as visionaries by Gartner, but not market leaders.
HP is attempting to build up a hybrid cloud offering based on OpenStack, but it too is nascent and lacking some features. VMware has a new IaaS offering named vCloud Hybrid Service, which Gartner said is appealing to IT decision makers, but Gartner questions if developers will be as interested in the platform compared to offerings from AWS and Microsoft.
Rackspace, Dimension Data, Fujitsu, Go Grid and Joyent are each listed as "niche" players in the market with their own advantages and plenty of concerns as well.
The takeaway is that the IaaS market is still young given that AWS has such a huge lead, in a couple of years the market will be much more mature.
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