Channel pockets 30 per cent of $80bn cloud infrastructure services market

Microsoft draws an estimated 74 per cent of Azure revenue from partners, but figure is much lower for Google Cloud and AWS, according to Canalys figures

Google Cloud was the fastest growing cloud infrastructure provider in 2018, besting market leaders Amazon Web Service (AWS), Microsoft Azure, according to Canalys.

The latest data from the market watcher indicated that Google had grown its global infrastructure services 90 per cent year on year, as well as growing its market share from six per cent in 2017 to eight per cent in 2018.

AWS retained its dominant position in the market with a share of 32 per cent, followed by Azure with 17 per cent, Google in third and Alibaba holding four per cent of the worldwide market.

Spending on cloud infrastructure services topped $80bn last year and Canalys expects this figure to hit $143bn in 2020.

Canalys estimated that the channel was responsible for around 30 per cent of the $80bn spent on cloud infrastructure services last year.

"AWS, Azure, Google Cloud and Alibaba Cloud are all increasing channel investment to raise their profiles, as competition for enterprise customers increases and workload cloud migration diversifies," stated Alastair Edwards, chief analyst at Canalys.

"The channel will play a vital role for the cloud service providers, in terms of boosting their customer reach, from both a sales and technical perspective.

"But each of the cloud service provider titans' current partner reach, engagement and programme maturity differs, with Google Cloud trailing both AWS and Azure in all areas.

"Alibaba Cloud is further back, though it too is investing in the channel as part of its international push."

The top three providers represented 65 per cent of the channel's total cloud infrastructure services business last year, the research house estimated, noting that Microsoft is considered the most important.

"Microsoft manages one of the largest channel ecosystems in the technology sector and its cloud solution provider programme is the most mature among the cloud titans," Edwards said.

"Approximately 74 per cent of revenue from Azure is estimated to come via its partners, which is by far the highest percentage in the sector.

"In contrast, AWS' channel business accounts for around 15 per cent, though its reach is growing rapidly, AWS having recruited over 35,000 partners to date, with hundreds a month wanting to join its partner programme."

Despite being the fastest-growing cloud vendor last year, Google Cloud's channel business accounts for just over a quarter of its $7bn cloud infrastructure revenue.

At its annual Next event this week, CEO Thomas Kurian committed to growing its partner base in order to snap up more enterprise customers.

Alex Smith, senior director of channels at Canalys, stated: "In spite of Google Cloud's rapid growth, its channel reach is relatively small, though it is trying a differentiated approach by being more focused on specific applications and verticals.

"An estimated 13,000 partners have joined its partner programme, of which just over 100 have achieved the highest-tier Premier Partner status, while less than a third of those have achieved a Specialisation Partner designation.

"Google Cloud's new leadership brings experience of working with the largest enterprise customers, but it has not captured the broader channel where AWS and Microsoft are being more proactive."