Story image

Cloud infrastructure market to face challenges in 2018

The worldwide cloud infrastructure services market grew 46% year on year in Q4 2017 to reach US$16 billion. 

This brought 2017’s full-year growth to 45%. 

Amazon Web Services (AWS) remained the leading vendor for the quarter, accounting for 32% of the total worldwide market. Microsoft, Google and IBM also held their positions among the largest global cloud service providers, representing 14%, 8% and 4% of the market respectively. 

The top four’s dominance grew, driven by their robust performances during the quarter. 

Microsoft (up 98%) grew the most, while Google (up 85%), AWS (up 45%) and IBM (up 9%) maintained momentum.

Canalys expects the cloud market to keep growing in 2018, but there will be challenges ahead.

Canalys Research Analyst Daniel Liu says, “2018 will be a disruptive year for the cloud infrastructure services market, which will affect the leading vendors’ costs. 

“Security vulnerabilities have emerged, led by the hardware-based Meltdown and Spectre flaws, which have affected Intel and other processors.”

“This could lead to users’ sensitive data being stolen from shared cloud infrastructure, firmware patches issued to address the vulnerabilities have also resulted in performance issues.” 

These issues will put further pressure on the hyperscale cloud vendors’ capital expenditure, which is already growing faster than revenue, as they will need to replace affected hardware and upgrade systems to restore customer confidence, and avoid data breaches and performance hits.

In addition, increasing regional and country-specific data compliance laws will add to challenges. The biggest this year will be the General Data Protection Regulation (GDPR), launched by the European Commission in 2016 to strengthen data protection within the EU. 

This will take effect on 25 May this year. 

Liu says, “The new regulation strengthens personal data protection for all EU citizens, but also affects the export of data outside of the EU. 

“Cloud service providers will need to adapt to the new regulation by investing time and money in local infrastructure, resources and policies to ensure compliance.”

"They will also need to boost customer confidence that they are compliant due to the financial repercussions of failure to comply.” 

Despite these disruptions, the overall trend Canalys expects to see in 2018 is a greater number of businesses increasing their expenditure on some form of cloud service.

Canalys expects the market will grow 36% in 2018.

Disruption in the supply chain: Why IT resilience is a collective responsibility
"A truly resilient organisation will invest in building strong relationships while the sun shines so they can draw on goodwill when it rains."
The disaster recovery-as-a-service market is on the rise
As time progresses and advanced technologies are implemented, the demand for disaster recovery-as-a-service is also expected to increase.
Cohesity signs new reseller and cloud service provider in Australia
NEXION Networks has been appointed as an authorised reseller of Cohesity’s range of solutions for secondary data.
The key to financial institutions’ path to digital dominance
By 2020, about 1.7 megabytes a second of new information will be created for every human being on the planet.
Proofpoint launches feature to identify most targeted users
“One of the largest security industry misconceptions is that most cyberattacks target top executives and management.”
What disaster recovery will look like in 2019
“With nearly half of all businesses experiencing an unrecoverable data event in the last three years, current backup solutions are no longer fit for purpose."
NVIDIA sets records with their enterprise AI
The new MLPerf benchmark suite measures a wide range of deep learning workloads, aiming to serve as the industry’s first objective AI benchmark suite.
McAfee named Leader in Magic Quadrant an eighth time
The company has been once again named as a Leader in the Gartner Magic Quadrant for Security Information and Event Management.