Ava AbbottAmazon Web Service (AWS) is a cloud computing platform that provides reliable and scalable solutions. This comprehensive computing platform is a subsidiary of Amazon.com based in Seattle and was launched in 2006.
AWS offers a wide range of cloud products and services, including servers, storage, networking, remote computing, email, mobile development, and more. AWS has 76 availability zones spanning 245 countries and territories. [1]
AWS bundles its products and services using flexible models, including Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS). Users can customize their packages to fit their budget, making AWS ideal for all businesses ranging from the newest start-up to a Fortune 500 company.
As of May 2021, AWS controlled 32% of the cloud computing market. Second-placed Microsoft Azure has a 19% market share, followed by Google Cloud with 7%. [2]
In 2020, AWS generated $45.3 billion in annual revenue, up nearly 30% year-over-year, with more than $13.5 billion in profits. It contributed more than 63% of Amazon’s entire net income for the year.
However, AWS’s revenue growth does not match its top competitors. Azure posted a 50% increase in revenues, and Google Cloud’s revenue was up 52%. Although AWS is dominating the market, its top competitors and alternatives are growing stronger by the day. [3]
Here is an in-depth analysis of top AWS competitors and alternatives:
1. Microsoft Azure
Year founded: 2010
Headquarter: Redmond, WA
Azure is a cloud computing service for building, testing, deploying, and managing applications. It is a cloud service of Microsoft, the innovative multinational tech giant. Like AWS, Azure also offers SaaS, PaaS, and IaaS. But it is growing faster than AWS. In 2020, Microsoft’s commercial cloud services hit the $50 billion mark in annual revenues. In the first half of 2021, Microsoft’s cloud sales surged 34% and will hit $66.8 billion.
According to a 2021 survey on IT budgets, more companies spend on Azure’s software-as-service than AWS. The main competitive advantage for Azure is its integration with Microsoft’s ecosystem. Businesses that already use Microsoft’s products are more likely to rely on Azure to move their operations to the cloud. Microsoft’s comprehensive ecosystem gives Azure an edge over AWS. Azure is the top AWS competitor and alternative. [4]
2. Google Cloud Platform (GCP)
Year founded: 2008
Headquarter: San Francisco, California
Google Cloud Platform provides flexible solutions, security, and intelligent insights to help users grow their business. GCP enjoys the backing of Google Inc., a technology and search engine powerhouse. It also integrates with Google’s comprehensive ecosystem, which increases its competitive edge over AWS. GCP hit the $10 billion annual revenue mark in February 2020 and is now approaching $16 billion.
Unlike AWS, GCP is not profitable. The company’s revenue growth is strong, but its losses are also increasing. GCP’s losses increased from $4.3 billion in 2018 to $4.6 billion in 2019 and $5.6 billion in 2020.
On the other hand, its revenue rose from $5.8 billion in 2018 to $8.9 billion in 2019 and over $13 billion in 2020. Analysts attribute mounting losses to investments in its cloud business. GCP launched data centers for four new regions in 2020. These investments increase GCP’s competitive edge and threaten AWS’s market share. [5]
3. Alibaba Cloud
Year founded: 2009
Headquarter: Hangzhou, China
Alibaba Cloud is the cloud computing arm of Chinese e-commerce giant Alibaba. Millions of online businesses on the Alibaba e-commerce marketplace use this cloud computing platform. It accounts for 7% of Alibaba’s revenue and controls 2.8% of the cloud computing market globally. Alibaba’s cloud offerings, features, and prices make it the ideal AWS alternative. However, AWS has been profitable since 2015, while Alibaba Cloud’s first profit was in 2020. [6]
The Chinese cloud giant trails behind Amazon and Microsoft in the IaaS market with 9%. In 2020, Alibaba Cloud’s revenue growth outpaced Amazon and Microsoft. Its annual revenue increased by 53.2% to $5.6 billion in 2020. In 2020, its revenue surged 60% y-o-y versus AWS’s 29% and Azure’s 48%. Alibaba Group’s fast-growing revenues and dominance of the Chinese market make it a top AWS competitor. [7]
4. Oracle Cloud Infrastructure
Year founded: 2012
Headquarter: Redwood Shores, California
Oracle Cloud Infrastructure is an integrated cloud application. The company offers enterprise IT solutions and SaaS, PaaS, and IaaS. One thing that sets Oracle apart from competitors is its latest cloud infrastructure, which delivers better performance, pricing, and security. For fiscal 2020, Oracle generated $39.1 billion in revenues, $27.4 billion from cloud services, and $5.1 billion from cloud license and on-premise license.
In 2020, Oracle netted several high-profile companies like Zoom, 8×8, McDonald’s, and Nissan. It also has one of the best performance-based pricing models on the market. Unlike other competitors, Oracle offers a single price globally and can poach some customers from AWS. It is the best AWS alternative for large enterprises. [8]
5. IBM Cloud
Year founded: 2011
Headquarter: New York, NY
IBM Cloud is a cloud computing and services platform offered by IBM Inc. The platform provides solutions and services via public, private, and hybrid cloud models. Like AWS, IBM Cloud uses IaaS, SaaS, and PaaS models to package and sell offerings. IBM Inc. operates in 170 countries worldwide and has over 100 years of experience, which increases IBM Cloud’s advantage over AWS.
In 2020, IBM’s annual revenue was $73.62 billion versus $77.147 billion for 2019. IBM Cloud generated $25.1 billion in 2020, up 19% year-on-year.
“The actions we are taking to focus on hybrid cloud and AI will take hold, giving us the confidence we can achieve revenue growth in 2021,” said IBM CEO Arvind Krishna. IBM’s growing cloud revenues and innovative offerings make IBM Cloud one of the top AWS competitors and alternatives. [9]
6. VMware Cloud
Year founded: 1998
Headquarter: Palo Alto, California
VMware Cloud is a flexible cloud computing platform that runs on any cloud and application. It integrates vSphere, vSAN, NSX, and vRealize and is the only hybrid solution that supports a multi-cloud strategy. Users can deploy VMware Cloud on AWS, Azure, Google Cloud, Oracle, IBM, and more. More than 300,000 organizations and over five million developers use VMware Cloud. [10]
VMware subscription and SaaS revenue surged 44% in 2020 and surpassed on-premises license revenue for the first time. For the full year 2020, VMware reported $11.8 billion in revenues, an increase of 9% from 2019. It expects total revenue of around $12.700 billion in 2021. VMware Cloud on AWS is the perfect AWS alternative. It can entice some customers from AWS. VMware’s multi-cloud integration makes it one of the most innovative AWS competitors. [11]
7. Salesforce Cloud
Year founded: 1998
Headquarter: San Francisco, California
Salesforce is a cloud-based software company specializing in customer relationship management (CRM) services and SaaS offerings. It is a global leader in CRM and offers Sales Cloud, Service Cloud, Marketing Cloud, and App Cloud. In 2019, Salesforce overtook Microsoft and became the leader in the global public cloud SaaS market. The company has 60,000 employees and controls 18.4% of the global CRM market.
In the fiscal year 2020, Salesforce generated a record-high revenue of $21.25 billion. About 34% of Salesforce’s cloud revenue comes from Sales Cloud, 30% from Service Cloud, 21% from App Cloud, and 15% from Marketing Cloud. Over 150,000 developers and organizations use Salesforce’s integrated platform. Salesforce is one of AWS’s top competitors and the best alternative for large businesses. [12]
8. DigitalOcean
Year founded: 2011
Headquarter: New York, NY
DigitalOcean is a cloud service provider for Linux developers. Its pricing model sets it apart from AWS and has gained traction among start-ups and SMBs. The company is going public in 2021 with a valuation of around $5 billion. However, unlike AWS, DigitalOcean is not profitable. Its net annual loss increased from $40 million in 2019 to $44 million in 2020.
AWS generates 142 times more revenue than DigitalOcean. Its 25% revenue growth for 2020 is also lower than AWS’s 29.5%. DigitalOcean has nearly 600,000 customers globally, such as Romania’s Bunnyshell, Malta’s Cloudways, Nigeria’s Jiji of Nigeria, Israel’s Vidazoo, and India’s Whatfix. Its pricing and intuitive products can poach developers and SMBs from AWS. [13]
9. Skytap
Year founded: 2006
Headquarter: Seattle, Washington
Skytap is a private cloud company that provides self-service access to cloud-based environments. The company has around 300 employees and offers on-demand cloud resources for businesses and developers. Users can access Skytap Cloud’s resources through browsers, REST API, and CLI to build new apps in the cloud or import existing virtualized apps.
IBM also offers Skytap to help enterprise customers migrate and modernize their applications. The company introduced Skytap on Azure in February 2020. These partnerships increase its edge over AWS. In 2020, Skytap generated $13.9 million. Even though AWS dwarfs Skytap, its innovative cloud services make it a worthy competitor. [14]
10. Interoute Virtual Data Center
Year founded: 2012
Headquarter: London, UK
Interoute is Europe’s leading cloud service provider and offers public, private, and hybrid cloud services, colocation, and data centers. The company has 44,000 miles of fiber, three transatlantic cables, virtual data centers, and colocation space in 50 locations. Interoute is worth around $2 billion, but its parent company GTT is more than $3 billion in debt.
In October 2020, GTT agreed to sell its infrastructure business to I Squared Capital for $3.15 billion. But reports indicate that it is planning to file for bankruptcy to solve its debt problem. GTT’s backing gives Interoute an edge over AWS. But uncertainty about its future shifts the scale back to AWS. [15]
References & more information
- Page, V. (2020, May 1). What Is Amazon Web Services and Why Is It so Successful? Investopedia
- Mlitz, K. (2021, May 28). Vendor market share in cloud infrastructure services market worldwide 2017-2021. Statista
- Bishop, T. (2021, Feb 2). Amazon Web Services posts record $13.5B in profits for 2020. Geek Wire
- Dignan, L. (2021, Jan 26). Microsoft’s Q2 Azure revenue up 50%, commercial cloud run rate at $66.8 billion; forecast tops consensus. ZDNet
- Lardinois, F. (2021, Feb 3). Google Cloud lost $5.6B in 2020. Tech Crunch
- Liao, R. (2021, Feb 3). Alibaba Cloud turns profitable after 11 years. Tech Crunch
- Kharpal, A. (2020, Nov 6). Alibaba cloud growth outpaces Amazon and Microsoft as Chinese tech giant pushes for profitability. CNBC
- Moorhead, P. (2021, Jan 4). Oracle Cloud Infrastructure is Growing Up and Gaining Customers. Forbes
- Fadilpašić, S. (2021, Jan 22). IBM profits slashed almost in half in 2020, despite cloud growth. IT Pro Portal
- NetApp (2021, Mar 1). VMware Cloud Services: A New Option for Hybrid Cloud Management. Cloud NetApp
- Hardesty, L. (2021, Feb 26). VMware revenues increase 9% in fiscal 2021. Fierce Telecom
- Liu, S. (2021, Mar 30). Salesforce revenue 2010-2021. Statista
- Novet, J. (2021, Mar 15). DigitalOcean emphasizes simplicity in IPO filing as it prepares to battle cloud giants like Amazon. CNBC
- Mackie, K. (2020, Feb 27). Skytap on Azure Service Adds Options for Apps Running on IBM Systems. Redmond Mag
- Judge, P. (2021, Feb 19). GTT rumored to be preparing for pre-packaged bankruptcy. Data Center Dynamics
- Featured image by Austin Distel on Unsplash
Kevin Johnson
Brianna Parker
Add comment