It’s time for our quarterly AWS vs Azure vs Google Cloud market share comparison, including the latest earnings the ‘big three’ cloud providers have reported. Let’s take a look at all three providers side-by-side to see where they stand.
Note: several previous versions of this article have been published. It has been updated for May 2021.
AWS vs. Azure vs. Google Cloud Earnings
To level-set this comparison, first know that – unsurprisingly – the cloud market as a whole is bigger than ever. Gartner has predicted worldwide public cloud spend to grow 18% in 2021, with 70% of organizations using cloud to increase cloud spending in the wake of COVID-19.
So within that market, let’s take a look at the AWS vs Azure vs Google Cloud market share breakdown and what each cloud provider’s reports shared.
Amazon reported Amazon Web Services (AWS) revenue of $13.5 billion for Q1 2021 – which exceeded analyst predictions of $13.1 billion. This is compared to $10.33 billion for Q1 2020. AWS revenue grew 32% in the quarter, accelerating from 28% growth in the fourth quarter. This quarter, AWS’s revenue accounted for 12% of Amazon’s total revenue – and nearly 47% of Amazon’s overall operating income. AWS continues to bolster the company as a whole with its profitability.
This quarter, AWS announced that former AWS executive and current head of Salesforce Tableau Adam Selipsky will run AWS, replacing Andy Jassy as he moves up to head all of Amazon.
Amazon’s CFO, Brian Olsavsky, said on the earnings call with investors, “During COVID, we’ve seen many enterprises decide that they no longer want to manage their own technology infrastructure,” he said. “They see that partnering with AWS and moving to the cloud gives them better cost, better capability and better speed of innovation. We expect this trend to continue as we move into the post pandemic recovery. There’s significant momentum around the world, including broad and deep engagement across major industries.”
And of course, much of the growth in public cloud comes from net-new workloads, not just those migrated from on-premises infrastructure. We’re curious to see how this trend continues.
While Amazon specifies AWS revenue, Microsoft only reports on Azure’s growth rate. That number is 50% revenue growth over the previous quarter – which is faster than the 46% growth analysts expected. This time last year, growth was reported at 59%. You may see headlines touting that “Azure growth rates are slowing”, comparing those revenue growth percentages. However, the metric is of questionable value as Azure continues to increase revenue at this enormous scale.
Here are the revenue numbers Microsoft does report. Azure is under the “Intelligent Cloud” business, which grew 23% to $15.1 billion. The operating group also includes server products and cloud services (26% growth).
Microsoft sees its cloud growth as fundamental to its success. CEO Satya Nadella said, “Over a year into the pandemic, digital adoption curves aren’t slowing down. They’re accelerating, and it’s just the beginning. We are building the cloud for the next decade, expanding our addressable market and innovating across every layer of the tech stack to help our customers be resilient and transform.”
The lack of specificity around Azure frustrates many pundits as it simply can’t be compared directly to AWS, and inevitably raises eyebrows about how Azure is really doing. Of course, it also assumes that IaaS is the only piece of “cloud” that’s important, but then, that’s how AWS has grown to dominate the market.
Nonetheless, Microsoft’s cloud business is clearly generating success for the company. Intelligent Cloud delivered the highest operating income of all segments this quarter at $6.4 billion, which is 37.7% of total consolidated operating income.
This quarter, Google Cloud reported revenue of $4.047 billion, an increase of 46% year-over-year. Operating losses were $974 million, compared to losses of $1.73 billion one year previously.
Note that the Google Cloud unit includes not only Google Cloud Platform but also Google Workspace (formerly G Suite).
Like the other giants, Alphabet highlighted its cloud growth. Google and Alphabet CFO Ruth Porat said, “We’re very pleased with the ongoing momentum in Google Cloud, with revenues of $4.0 billion in the quarter reflecting strength and opportunity in both GCP and Workspace.”
Porat also said that Google Cloud Platform (GCP)’s revenue growth was once again “meaningfully above cloud overall.”
Alibaba cloud revenue grew 37% year-over-year to $2.6 billion. They mention that “the slower revenue growth during the quarter was primarily due to revenue decline from a top cloud customer in the Internet industry. This customer, which has a sizeable presence outside of China that used our overseas cloud services in the past, has decided to terminate the relationship with respect to their international business due to non-product related requirements.” They believe their remaining cloud customers are sufficiently diversified to prevent such a large impact from a single customer in the future.
Cloud Computing Market Share Breakdown – AWS vs. Azure vs. Google Cloud
When we originally published this blog in 2018, we included a market share breakdown from analyst Canalys, which reported AWS in the lead owning about a third of the market, Microsoft in second with about 15 percent, and Google sitting around 5 percent.
In 2019, they reported an overall growth in the cloud infrastructure market of 42%. By provider, AWS had the biggest sales gain with a $2.3 billion YOY increase, but Canalys reported Azure and Google Cloud with bigger percentage increases.
As of April 2021, Canalys reports that the worldwide cloud market grew 35% this quarter to $41.8 billion. AWS has 32% of the market, followed by Azure at 19%, Google at 7%, Alibaba Cloud close behind.
Bezos has said, “AWS had the unusual advantage of a seven-year head start before facing like-minded competition. As a result, the AWS services are by far the most evolved and most functionality-rich.”
Our anecdotal experience talking to cloud customers often finds that true. It seems clear that in the case of AWS vs Azure vs Google Cloud market share – AWS still has a substantial lead, and their market share remains steady. With that said, all players are pushing growth and innovation and driving public cloud adoption across the board.
The idea that you will reduce costs during an Azure migration is not a given. In fact, when an organization is new to the cloud is when they are prone to missing details or falling in step with habits from their on-prem days. Unfortunately, up to $26.6 billion will be wasted this year due to idle and overprovisioned cloud resources. All of that could be prevented.
When the team at Providence Health took on a migration to Microsoft Azure in early 2020, they planned ahead for these challenges – and built cost optimization into their migration plans, so they could land with an optimized infrastructure and truly take advantage of the elasticity of public cloud.
Here’s how they did it.
First, Overcome the Cultural Challenges of Azure Migration
Migration can be scary for users who have never used the public cloud before. Often, those who are less familiar with public clouds have misconceptions about security, reliability, or cost. When Bryan de Boer joined the Providence Health team as an Executive Director of IT in 2020, their Microsoft Azure migration project was just beginning. Bryan recalled, “The very ideas of cloud elasticity, flexibility, and optimization were completely foreign to this enterprise… Servers were fixed resources that you bought; they were physical resources that just sat there, and it was a one-time upfront purchase. There was a conceptual paradigm shift that needed to occur.”
Luckily, by getting in front of these misconceptions with education, you can address them and get your teams on board and even excited for the move to the public cloud. Bryan told us the process of educating key stakeholders was fun, and this is not to be ignored – by treating your colleagues kindly and with good humor, you can build the rapport and shared-dream teamwork that makes digital transformation possible throughout the organization.
Optimization is not a one-time activity. In fact, we estimate cloud resource drift of about 10-15% month over month, which could mean a complete environment turnover in less than one year. Thus, continuous optimization is key. One straightforward way to bake this optimization into your processes is by setting on/off schedules on non-production resources, such as development, testing, staging, and QA, so that you’re only paying for on-demand resources when you need them. This is also a great way to give some ownership over cloud resources and costs to the end-users within your organization, to make the transition from an overprovisioning-happy on-premises model to the on-demand consumption charging model of the public cloud.
Speed to Vaccination Supported by Cloud Adoption
Once you internalize the concepts of cloud elasticity, you can start to grow and innovate faster than ever before. For the Providence Health team, this took the trailblazing form of building a new COVID-19 vaccination tracking and scheduling application that they were able to launch in a matter of days – a process that would have taken months pre-migration. With this rapid test case, the Admin Tech application team proved that they could solve significant problems in a very short period with the agility of the cloud. This became a key proof point in driving the internal cultural change to show the value of cloud infrastructure.
Join Us Live for More
Want to hear Providence’s story, live? Want to see how they were able to launch that vaccine tracking application so quickly? Join us.
Bryan de Boer will be speaking at our upcoming Apps ON Cloud Summit, happening online May 11th through 13th. Learn from customers like Providence alongside the industry’s best, like Kelsey Hightower and prince of snark Corey Quinn. Plus, we’re doing a giveaway for a two-night getaway to one lucky attendee – details on the registration page. Hope to see you there!
When you create a virtual machine in Microsoft Azure, you are required to assign it to an Azure Resource Group. This grouping structure may seem like just another bit of administrivia, but savvy users will utilize this structure for better governance and cost management for their infrastructure.
What are Azure Resources Groups?
Azure Resources Groups are logical collections of virtual machines, storage accounts, virtual networks, web apps, databases, and/or database servers. Typically, users will group related resources for an application, divided into groups for production and non-production — but you can subdivide further as needed.
Management groups: These groups are containers that help you manage access, policy, and compliance for multiple subscriptions. All subscriptions in a management group automatically inherit the conditions applied to the management group. These are often used for grouping subscriptions by internal department or geographical region.
Subscriptions: A subscription associates user accounts and the resources that were created by those user accounts. Each subscription has limits or quotas on the amount of resources you can create and use. Organizations can use subscriptions to manage costs and the resources that are created by users, teams, or projects. A subscription is essentially a billing unit.
Resource groups: A resource group is a logical container into which Azure resources like web apps, databases, and storage accounts are deployed and managed.
Resources: Resources are instances of services that you create, like virtual machines, storage, or SQL databases.
One important factor to keep in mind when managing these scopes is that there is a difference between azure subscription vs management group. A management group cannot include an Azure Resource. It can only include other management groups or subscriptions. Azure Management Groups provide a level of organization above Azure Subscriptions. Also, there is no structure for a “nested” resource group in Azure – to “nest” groups for permissions, you will need to use a combination of permissions at the different levels listed above.
Be sure also to differentiate the concept of an Azure resource group from an “Azure availability set”. An availability set in Azure is a logical grouping of VMs to inform Azure how your application is built in order to protect the availability of your application.
Group structures like Azure’s exist at the other big public clouds — AWS, for example, offers optional Resource Groups, and Google Cloud “projects” define a level of grouping that falls someplace between Azure subscriptions and Azure Resource Groups.
The Azure Resource Manager
You will manage resource groups through the “Azure Resource Manager”, which is the management layer for your resources. Benefits of the Azure Resource Manager include the ability to manage your infrastructure through declarative templates rather than through scripts; tagging management; deployment templates; dependency mapping; simplified role-based access control; and clarified cost management.
You can organize your resource groups for securing, managing, and tracking the costs related to your workflows.
Ways to Create an Azure Resource Group
There are several ways to create an Azure Resource Group, or in other words, several ways to actually manage using the Azure Resource Manager. They are:
The Azure Portal
Azure PowerShell scripts
The Azure CLI
An ARM template
Azure Resource Group Best Practices
When organizing your resource groups, it is essential to understand that all the resources in a group should have the same life-cycle when including them. For instance, if an application requires different resources that need to be updated together, such as having a SQL database, a web app or a mobile app, then it makes sense to group these resources in the same resource group. However, for dev/test, staging, or production, it is important to use different resource groups as the resources in these groups have different lifecycles.
Other things to consider when building your Azure list of resource groups:
Resources can be added to or deleted from an Azure Resource Group. However, each of your resources should belong to an Azure Resource Group, so if you remove the resources from one Resource Group, you should add it to another one.
Azure resource group regions: the resources you include in a resource group can be located in different Azure regions, and may be in different regions than the group itself. The group needs a location to specify where the metadata will be stored, which is necessary for some compliance policies. (Read more on pricing in different Azure regions.)
Grant access with resource groups: you should use resource groups to control access to your resources – more on this below.
When a resource group is deleted, all resources in the group are deleted
Group limits: you can deploy up to 800 instances of a resource type in each resource group – with some exceptions.
How to Use Azure Resource Groups Effectively for Governance
Azure resource groups are a handy tool for role-based access control (RBAC). Typically, you will want to grant user access at the resource group level – groups make this simpler to manage and provide greater visibility.
Azure resource group permissions help you follow the principle of least privilege. Users, processes, applications, and devices can be provided with the minimum permissions needed at the resource group level, rather than at the management group or subscription levels. For example, a policy relating to encryption key management can be applied at the management group level, while a start/stop scheduling policy might be applied at the resource group level.
Effective use of tagging allows you to identify resources for technical, automation, billing, and security purposes. Tags can extend beyond resource groups, which allows you to use tags to associate groups and resources that belong to the same project, application, or service. Be sure to apply tagging best practices, such as requiring a standard set of tags to be applied before a resource is deployed, to ensure you’re optimizing your resources.
Azure Resources Groups Simplify Cost Management
Azure Resource Groups also provide a ready-made structure for cost allocation — resource groups make it simpler to identify costs at a project level than just relying on Azure subscriptions. You can use cost allocation tags to manage the costs of the resources within the group together. Additionally, you can use groups to manage resource scheduling and, when they’re no longer needed, termination. Make sure you don’t skip that step – keep waste in check.
You can do this manually, or through your cost optimization platform such as ParkMyCloud. Continuous cost control comes from actual action – which is what ParkMyCloud provides you through a simple UI (with full RBAC), smart recommendations with one-click remediation, and an automatic policy engine that can schedule your resources by default based on your tagging or naming conventions. For almost all Azure users, this means automatic assignment to teams, so you can provide governed user access to ParkMyCloud. It also means you can set on/off schedules at the group level, to turn your non-production groups off when they’re not needed to help you reduce cloud waste and maximize the value of your cloud. Start a trial today to see the automation in action.
A version of this article was published in April 2020. It has been updated and expanded for 2021.
There are three advantages of using public cloud: cloud elasticity, agility, and cost reduction. However – most public cloud users are not (yet!) achieving all three of these. While you may be aware if your costs are out of control, what you may not consider is how directly that’s tied to a misuse of the idea of “elasticity”.
The True Meaning of Cloud Elasticity
There’s a reason “elastic” is in the name of EC2 and EBS. Users can provision what they want, when they want it, to easily scale up to meet demand. This ability is what has fueled the explosion of agility and enabled experimentation and innovation.
But the other ingredient in elasticity is shrinking or turning off resources dynamically to meet demand, which is not nearly as easily achieved… and is often neglected. The problem with only being “half” elastic is fundamental to the purpose of the cloud.
When you let resources in one direction only – up – in the name of “elasticity”, you neglect the promise of the cloud: only pay for what you need. You’ll be slapped in the face with rising costs. And yes – we’ve seen this happen time and time again. Organizations find that those easily-provisioned resources stick around, clogging their environments with waste.
Knowledge is Power, but Not Always Action
A recent Turbonomic survey found that optimizing existing cloud resources for performance and cost was the #1 goal for cloud users this year. The fact that this came in at #1 shows us that there’s certainly awareness among cloud customers that this is a problem they need to solve.
This is not news to you. You’ve perhaps seen the bill. You may have dashboards slicing and dicing your cloud bill. But too often, those dashboards are simply something to pull up for pretty data (or ugly, as the case may be) to share in a team meeting. The knowledge doesn’t
We get it. We’re all busy. Our priorities in the workplace are always shifting, and honestly, it can be hard to make ✨achieving the promise of cloud elasticity✨ one of them. It’s definitely hard to make “reducing costs” one of them.
But here’s the thing: knowledge – like the visibility you gain from cost dashboards – is power.
In our experience, most people do not act on that power.
When Elasticity Goes Two Ways, You Can Optimize
What would it look like to take that knowledge and turn it into action?
You would truly only use the resources you need, when you need them. You would take advantage of public cloud’s usage-based pricing model, and achieve a cost-optimized environment.
And ideally, this would be automated – so the action just happens and you can spend your time on those more exciting benefits of cloud infrastructure: growing and innovating. When you eliminate wasted spend from your cloud environment, you open up your budget to achieve the business goals that really matter.
Here at ParkMyCloud, we help you with ensuring elasticity with easy-to-implement actions based on your utilization data. By “parking” non-production resources when not needed, such as nights and weekends, you can reduce the cost of those resources by 65% – an easy win for both elasticity and cost optimization.
Topping the list of cloud computing trends 2021 is…drumroll please…cloud optimization!
This is according to data collected by the annual State of Multicloud Survey run by Turbonomic (that’s our parent brand). The survey, using data collected from more than 800 global IT professionals, examines the state of multicloud adoption, its drivers, and the technologies enabling it, including public cloud, containers, and edge computing. Here are a few highlights from the report.
Optimization Remains Top Priority for Public Cloud
As mentioned above, when asked their most important initiative for 2021, survey respondents ranked “optimize existing cloud resources for performance and cost” as their highest priority. We see this need playing out every day as we talk to enterprises, both newly migrated and with years of experience in the cloud. Those who are paying attention are realizing their infrastructure is overprovisioned, running when not needed, or otherwise wasted – to the tune of $26.6 billion wasted this year in all. By making optimization a priority, tech leaders can reallocate wasted spend and achieve more with their budgets.
Advancing a Multicloud Strategy Rated #2
After optimization, the next-highest ranked initiative was “advancing a multicloud strategy”(multiple public clouds with or without private clouds in the mix). Multicloud existence is the reality for most organizations – and 30% of survey respondents are using three or more public clouds today. Research by IDG finds that the most common reported reason for using multiple public clouds is to get the best platform and service options available.
Relevance of PaaS is Growing
Of organizations surveyed, 62% reported that public cloud PaaS will play a strategic role for their business within 18 months. This is supported by research from Gartner, which estimates the PaaS market will grow by 26% this year, driven at least in part by the need for remote workers to have access to scalable infrastructure in the form of modernized and cloud-native applications.
Container Use is Advancing – But Difficult to Scale
For 61% of organizations surveyed, containerization will play a strategic role within 18 months. It is already strategic for nearly 20% today. Of those already implementing containers, 56% are using them in production. For the remainder, operations are difficult to scale due to the complexity introduced and the difficulty to optimize.
The Full Report on Cloud Computing Trends 2021
Check out the report for the full data for each of these highlights, as well as results about AWS vs. Azure use, container deployment trends, edge computing, and how leaders compare to laggards in cloud services and strategy adoption. Read the 2021 State of Multicloud Report now.
If optimization is a priority for your cloud organization, check out the free trial of ParkMyCloud to start reducing costs through parking and rightsizing.