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The global market for cloud infrastructure services grew by 30 percent last year, exceeding $100 billion in value for the first time and two lions account for nearly two-thirds of that entire spend.

These latest figures come courtesy of number cruncher Gartner and cover just the infrastructure-as-a-service (IaaS) side of the public cloud comprising servers, storage and network resources that organizations are paying to access.

According to Gartner, the worldwide infrastructure services market grew by 29.7 percent to hit a total of $120.3 billion during 2022, up from $92.8 billion the previous year.

This is despite the growth in cloud services showing signs of slowing during the second half of the year as businesses started to rein in spending, and compares with upwards of 40 percent growth seen during 2021.

The figures confirm that the IaaS market is locked down with Amazon Web Services and Microsoft's Azure cloud platform, which account for 40 percent and 21.5 percent of the entire global market share respectively. That translates to over $48 billion in revenue for AWS, and nearly $26 billion for Azure.

Compared to those giants, China's Alibaba cloud came in a distant third at $9.28 billion, just beating Google Cloud into fourth place, which had revenue of just over $9 billion. Huawei snuck into the top five global IaaS providers with $5.25 billion in revenue and 4.4 percent market share.

Altogether, those top five providers made up over 80 percent of the infrastructure services market, with all the other players making up the remaining 18.9 percent, some $22.7 billion in revenue.

Gartner VP analyst Sid Nag said that IaaS growth during 2022 had been stronger than expected despite the slowdown later in the year "as customers focused on using their previously committed capacity to its fullest potential."

"This is expected to continue until mid-2023 and is a natural outcome of the market's maturity. We expect an acceleration in 2024, as there is still room for plenty of additional future growth," Nag claimed.

Nag said Alibaba continued to rule the IaaS market in China, but limited potential for expansion outside China has slowed its growth, leading to the company's recent decision to spin off the Alibaba Cloud business into a separate entity.

Google achieved the highest growth rate of the top five IaaS vendors, growing 41 percent in 2022, attributed to its investment in sovereign cloud efforts and expanded partner programs that helped to broaden its customer base.

Nag also predicted that generative AI would drive further cloud market expansion.

"As enterprises integrate generative AI into their technology portfolio, new markets and opportunities for cloud hyperscalers will emerge related to sovereignty, ethics, privacy and sustainability," Nag said.

Recent data from Synergy Research Group indicates that hyperscalers accounted for 37 percent of worldwide capacity of all data centers, with non-hyperscale colocation capacity amounting to 23 percent of capacity and on-premise data centers some 40 percent.

"This is in stark contrast to five years ago, when almost 60% of data center capacity was in on-premise facilities," the group said.

The total capacity of all datacenters will continue to rise steadily, the company predicts, driven primarily by hyperscale capacity almost doubling over the next five years. While the on-premises share of the total will drop by about 2 percent per year, the actual capacity of on-premises datacenters will decrease only marginally.

The difference is that 10 years ago, enterprises were spending over $80 billion per year on IT hardware and software for their own datacenters, with less than $10 billion going on cloud infrastructure services.

Fast forward to the present day, Synergy says, and spending on datacenter hardware and software has grown by an average of just 2 percent per year, while spending on cloud services has ballooned, growing by an average 42 percent per year.

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AWS and Azure own lion's share of $120B cloud infrastructure market - The Register