Cloud services spend exceeds $50bn in single quarter for first time - Canalys

Researcher says the re-opening of economies, increased customer confidence and demand in the public and healthcare sectors were driving factors

Worldwide spending on cloud infrastructure services surpassed $50bn for the first time in the final quarter of 2021, according to research from Canalys.

Total spending grew 34 per cent to $53.5bn in the fourth quarter of 2021, up $13.6bn on the same period a year ago.

For the full year, total cloud infrastructure services spending grew 35 per cent to $191.7bn compared with $142bn in 2020, which Canalys said was down to the "reopening of economies post-lockdowns and growing customer confidence during the year".

"Cloud services are well positioned for individual developers and organisations looking to enter the metaverse," said Canalys research analyst Blake Murray.

"Compute will be in high demand in virtual and augmented reality environments, while storage, machine learning, IoT and data analytics will be essential to support operations such as digital twinning, modeling and interactivity in the metaverse."

Amazon Web Services (AWS) led the cloud infrastructure services market in Q4 2021, accounting for 33 per cent of total spend while growing 40 per cent on an annual basis.

Microsoft Azure had a 22 per cent market share and was the second largest provider, growing 46 per cent which Canalys said was "driven by long-term consumption commitments".

Meanwhile, Google Cloud was the third largest provider and grew 63 per cent to account for nine per cent of the total market.

Canalys also credited "lasting pandemic-related consumption drivers" including "remote working and learning, ecommerce, gaming and content streaming" as important factors behind the increase in cloud spend, as well as the use of cloud services in the healthcare and public sector.

"Continued investment in the metaverse by developers will result in a massive opportunity for cloud service providers, especially the hyperscalers," said Canalys VP Alex Smith.

"Building trust with customers and key technology partners will drive competitive positioning for metaverse development, while global infrastructure, edge deployments and 5G connectivity will be necessary for widespread low-latency experiences."