While cloud technology adoption was well underway before COVID-19, the pandemic and mass online shift has seen the majority of businesses experience higher cloud usage than previously planned. The surge has boosted competition in the space, with top providers Amazon Web Services (AWS), Microsoft Azure, and Google Cloud introducing new features and pricing models to establish a competitive edge. Currently, AWS leads the charge, with 79% of enterprises using its services, followed by Azure with 69%, and Google Cloud with 34%. Notably, a staggering 93% of enterprises are turning towards a multi cloud strategy.
Here's how the battle for supremacy in the cloud is unfolding.
Amazon Web Services
AWS was born out of the need to expand Amazon's website beyond its initial book-selling model. As the e-commerce platform grew to be a powerhouse for a range of sellers and goods, building a cloud was necessary to scale. As a side effect, Amazon's own cloud became a standalone product that was made publicly available.
Because Amazon championed cloud computing as an industry, it has the first-mover advantage and is often seen as the template for emerging cloud providers. It supplies servers, storage, networking, remote computing, email, mobile development, and security for organizations, and has more than 1 million active users in 190 countries. In fact, AWS has deployed five times more cloud infrastructure compared to its 14 cloud provider competitors combined.
In its early days, AWS made a particularly big splash in the startup space, as it allowed ventures to migrate away from expensive server hardware and software. For tech startups like Palantir and Slack, the cost savings and scalable tech proved extremely valuable. On the other hand, Netflix was not a startup when it partnered with AWS but because it was an early cloud adopter, it was able to transform its business model and innovate ahead of competitors. Nowadays, AWS clients include the likes of Expedia, Lyft, Disney, Pro7, F-Secure, BASF, and VW.
The sizable ecosystem of AWS is one of its biggest perks, as it supports a wide variety of customer needs. Companies also only pay for what they use - there's no need to estimate usage, and there are no upfront costs to build a storage system. On top of that, AWS has an easy-to-use interface (AWS Management Console), a selection of IaaS tools, diverse PaaS and serverless services (from storage, computing, to advanced data analytics, IoT and AI), unlimited server capacity, and reliable encrypted security.
AWS is not without its shortcomings though. Some of its resources are limited by region, and customers are subject to vendor lock-in due to high switching costs. Teams also require a specific level of understanding of AWS cloud services, so organizations have to invest in AWS education before committing to it on a long-term basis.
Launched in 2010, Microsoft's offering in the cloud space is a popular choice with C-level executives and enterprises who trust the longevity and expertise of the Microsoft brand. Whereas Amazon is best-known for its e-commerce might, Microsoft is highly regarded for its computing proficiency. So much so, that in October last year, AWS lost a 10-year Pentagon contract of $10 billion to Microsoft Azure.
Microsoft Azure supports numerous programming languages, frameworks, and tools from both Microsoft and third-party providers. It's therefore as flexible as AWS, and has earned an advantage as more businesses opt to undertake a hybrid-cloud strategy where some data and actions are kept on-site and other tasks are done via cloud-computing. Not to mention, Microsoft Azure has more than 600 products available, multi-level protection (for both users and the platform), and has high availability and redundancy in data centers on a global scale.
Where Microsoft Azure falls short, however, is that its cloud service speeds are affected by location. For instance, South America, Canada, and Africa have limited access to Azure.
Google's defining feature is that it allows businesses to strike deals with multiple cloud providers - leveraging businesses' preference for multi-cloud strategies.
Similar to Microsoft's standing in the computer engineering space, Google's unprecedented scale in the search space means that it has impressive machine-learning capabilities, powered by vast volumes of data. Google also has in-depth expertise around open-source technologies, especially in containers due to its central role in the development of Kubernetes for orchestration and the Istio service mesh. What's more, Google Cloud lets customers access and engage with its engineering strength, particularly for co-development projects. As a result, Google Cloud appeals most to businesses hoping to innovate and push for the most cutting edge digital transformation.
Google Cloud's new CEO, Thomas Kurian, has been instrumental in helping the services enter the enterprise sector. Kurian has pushed functionalities that let customers leverage Google Cloud's data analytics and machine-learning to understand data in new, smarter ways. There's even hardware support for machine-learning, such as AI and ML-dedicated services that are powered by tensor processing units. Other perks include high durability, different storage classes for each necessity, easy integration with other Google services, and 20% cheaper storage costs compared to AWS.
The drawbacks of Google Cloud come in the form of expensive support, concerns over data security, and a lack of traditional relationships with enterprise customers - however, Google is in the process of expanding its offerings and its global data centers.
The COVID-19 pandemic is accelerating the movement from mono to multi-cloud, as customers who once rented technology transition into building their own platforms and applications. In the remote revolution, customers want to deploy across multiple vendors' infrastructure but also need to maintain some applications on-premise. As IBM Chief Information Office, Fletcher Previn, says, "large companies want a multi-cloud strategy beyond a public option."
In turn, the top three cloud providers have launched hybrid or multi-cloud models - AWS has Outposts, Microsoft has Azure Stack and Azure Arc, and Google has Anthos. This direction could close the gap between competitors and see market share dynamics quickly change, however, the evolution has to be both effective and affordable. The provider that can successfully strike a balance between the two will no doubt reign supreme in the cloud for the foreseeable future.