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Global cloud infrastructure spend hits $62.3bn during Q2 2022

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Latest market data as a result analyst house Canalys reveals no let-up popular for cloud infrastructure services through the second quarter of 2022

Caroline Donnelly

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Published: 02 Aug 2022 10: 31

Demand for cloud infrastructure services continues to go from strength to strength, with global market data from Canalys revealing a 33% year-on-year rise in spending of this type to $62.3bn through the second quarter of 2022.

The analyst house said cloud infrastructure spending had been sustained by way of a mixture of factors, including demand for data analytics and machine learning technologies, and also datacentre consolidation projects and enterprises seeking to migrate more of these workloads and applications to the public cloud.

The growing usage of industry-specific cloud applications also contributed to the broader horizontal use cases seen across IT transformation, said Canalys, in its research note.

Cloud spending was up $6bn weighed against the initial quarter of 2022, or more $15bn on a single quarter this past year, with Amazon Web Services (AWS), Microsoft Azure and Google Cloud collectively accounting for 63% of the $62.3bn spent through the second quarter of 2022.

AWS accounted for 31% of the full total devote to cloud infrastructure services through the second quarter, while Microsoft accounted for 24% and Google 8%, with Canalys suggesting the marketplace was effectively a two-horse race.

The hyperscale battle between leader AWS and challenger Microsoft Azure continues to intensify, with Azure closing the gap on its rival, said Canalys.

Fuelling this growth, Microsoft pointed to an archive amount of larger multi-year deals in both US$100m-plus and US$1bn-plus segments. A diverse go-to-market ecosystem, coupled with an easy portfolio and wide variety of software partnerships is enabling Microsoft to remain hot on the heels of AWS.

Cloud remains the strong growth segment in tech. While opportunities abound for providers large and small, the interesting battle remains right at the very top between AWS and Microsoft. The race to purchase infrastructure to help keep pace with demand will undoubtedly be intense
Alex Smith, Canalys

To maintain with the demand because of their services, both AWS and Microsoft have ambitious plans set up to create out their datacentre infrastructure on the year ahead, with Amazon plotting to create 24 further availability zones across eight cloud regions online. Microsoft, meanwhile, plans to launch 10 new regions on the next 12 months.

Cloud remains the strong growth segment in tech, said Alex Smith, vice-president of Canalys. While opportunities abound for providers large and small, the interesting battle remains right at the very top between AWS and Microsoft. The race to purchase infrastructure to help keep pace with demand will undoubtedly be intense and test the nerves of the firms CFOs [chief financial officers] as both inflation and rising interest levels create cost headwinds.

To weather a few of these pressures, Microsoft used the publication of its fourth-quarter financial results to announce dedication to increase the useful life of its servers and network equipment from 4-6 years.

This can improve operating income and shows that Microsoft will sweat its assets more, which helps investment cycles because the scale of its infrastructure continues to soar, added Smith.

The question will undoubtedly be whether customers feel any negative impact when it comes to user experience later on, as some services will inevitably operate on legacy equipment.

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