Microsoft Azure solidly leads IaaS/PaaS/SaaS market, says analyst firm

Some welcome and surprising context about the public cloud market landed this week, in which an analyst now puts Microsoft (with Azure) in a solid leadership position.

Investment bank and market analyst firm Jefferies launched what it plans as a quarterly report on public cloud services, this first report authored by Jefferies analyst John DiFucci.

As a MarketWatch story details, DiFucci based his rankings on annualized revenue from each of seven company's most recent quarterly report, compared with 2017 estimates from Gartner Inc. The seven companies include (in alphabetical order):

• Alibaba
• Amazon.com, Inc.
• Google
• IBM
• Microsoft
• Oracle
• Salesforce.com

Limiting the discussion to the three titans (Amazon, Microsoft, IBM) and rapidly-gaining Google, Amazon Web Services (AWS) is solidly the leading IaaS/PaaS provider, with nearly three times the annualized revenue of Microsoft (18.34 billion vs. $6.17 billion), and 51% of the market share versus Microsoft Azure's 17 percent.

But of course, snapshots do not tell the whole story; AWS year-over-year growth is 42%, less than half of Azure's 89%, and about a third of Google's 125%. Still, it is nearly twice that of IBM's trudging 22% growth.

DiFucci wrote that these revenues, to Jefferies' knowledge, "represent ‘true' public cloud deployments," including both multi-tenant and dedicated single instances of IT resources provided by cloud vendors.

But add Software as a Service (SaaS), and the picture shifts dramatically to favor SaaS leader Microsoft. It's annualized revenue for IaaS, PaaS, plus SaaS is $21.21 billion versus AWS's second-place $18.34 billion. Azure leads in market share as well, with 31% versus AWS's 26%; and 64% YoY growth versus AWS's 42%.