The global cloud infrastructure services market grew by 45 per cent in 2017, recording 46 per cent year on year in the fourth quarter, reaching $16 billion (£11.3 billion).
This is according to research from Canalys, which also found that Amazon Web Services remained the leading vendor for the quarter, accounting for 32 per cent of the total worldwide market.
Microsoft took second place, making up 14 per cent of the market, while Google was third, at eight per cent. IBM finished off the top four, taking four per cent of the global market. Each of these companies recorded growth, with Microsoft seeing the most, at 98 per cent. Google also performed well, marking 85 per cent growth.
Canalys said it expects the cloud market to keep growing in 2018, but added that there will be challenges ahead.
Daniel Liu, Canalys research analyst, said: “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.”
Mr Liu added that these security issues will put “further pressure on the hyperscale cloud vendors’ capital expenditure”, which he explained is already growing faster than revenue. This is because they will need to replace affected hardware and upgrade systems to restore customer confidence, as well as avoid data breaches and drops in performance.