aure market share

Why It’s Impossible To Accurately Calculate Azure Market Share

CloudHealth Tech Staff
Published:
Feb. 14, 2020
3 minute read

Although multiple sources produce graphs and charts depicting the Azure market share each quarter, it’s impossible to accurately calculate what share of the market Azure has due to the way in which Microsoft presents revenue figures. This also makes it hard to calculate the total value of the cloud market.

When Amazon presents quarterly revenue figures, it’s clear how much revenue has been generated by AWS. That isn’t the case with Microsoft and Google, who often fail to specifically break down services revenue to individual products (Google combined Google Cloud and G-Suite revenue figures up until their most recent earnings call). 

This means industry experts have to make educated guesstimates about the Azure market share based on what they know about the utilization of the combined services and from small snippets of information released by the company itself. For example, in Q1 2019, Microsoft reported an Azure growth rate of 73 percent without specifying how the growth was achieved or what the growth rate represented.

The picture becomes more confusing when industry experts attempt to analyze and compare IaaS, PaaS, and SaaS revenues separately, because other than AWS’ revenues, the rest is just conjecture. One contributor to the techrepublic.com website called the conjecture “cloud market share bingo” and he's absolutely right, as nobody knows for sure the size of the cloud market or who has what share.

Business surveys don't shed any light on the topic

Despite the potential for inaccuracies, analyzing and comparing cloud providers’ revenues is the only option industry experts have for determining the Azure market share. Business surveys do not shed any light on the topic because many businesses operate in multiple clouds and surveys fail to distinguish between the volume of costs, deployments, or workloads assigned to one cloud over another.

Does the Azure market share matter anyway?

Some industry observers might suggest that having a bigger market share implies confidence in a service provider, but that isn’t necessarily the case. In much the same way as AWS is the IaaS market leader because it was first-to-market, many Azure users are existing Microsoft customers that had on-premises data centers reliant on Microsoft services before migrating to the cloud.

Microsoft simplified the migration process for its existing customers by developing cloud services that were compatible with its on-premises services—saving businesses a lot of time and money refactoring applications. Consequently, interpreting market share as an indicator of confidence can be misleading because the two companies with the largest market share, aside from having a high-quality product, also happened to capitalize on early markets at the right time.

Ultimately, what’s most important for businesses than the Azure market share is that the platform provides them with a cost-efficient, easy-to-manage, and secure cloud environment. If your business is currently operating on the Azure Cloud—or considering a migration to Azure— learn how a cloud management platform can maximize cost-efficiency, performance, and security.