Monday, October 23, 2017

AWS cloud loses traction to Azure (and that outage is not even to blame)

Of the $1.3tr spent on IT, $60bn are estimated to be put towards cloud deployments which Microsoft seems to be reaping the benefits from.

Microsoft might finally be on the right path to win over a larger stake of the public cloud market as noted by investment-banking think tank Pacific Crest Securities.

The company’s senior research analyst and partner Brent Bracelin has surprised markets by lowering Amazon’s price target from $905 to $895 as the company faces fiercer competition in its cloud business – AWS – from other web scalers.

Driving that price drop is Microsoft’s and Google’s recent successful efforts to secure new business with startups and Fortune 500 companies.

Bracelin said: “AWS boasts a multiyear lead over Microsoft Azure and Google Cloud. However, heavy investments could increase the viability of these alternatives.

“After three years of outsized gains and a tripling of profits, AWS’ growth could moderate this year and next.

“Amazon has been wildly successful, is by far the market leader, and has a multi-year advantage.

“But on the margins for customers who have not embraced AWS, Microsoft offers the option of running Azure inside their own data centres and move workloads in a much less disruptive manner.”

Bracelin has also pointed that Microsoft Azure appears to be gaining ground within large enterprises “as not only a functional substitute for AWS, but also as having unmatched product breadth that spans both on-premise and cloud environments”.

In addition, and despite making headlines all over the world, AWS’s recent outage in the US has not influenced Bracelin’s move to downgrade the company.

Bracelin said: “Everyone has outages, even companies with internal data centres.”