Big Five eating away the share of niche cloud providers, warns Memset

New research from Gartner shows that the Big Five continue to consolidate their market share while squeezing out smaller cloud providers

Latest industry research has found that IaaS (Infrastructure-as-a-service) cloud market continues to grow at record speed, with Amazon Web Services, Microsoft, Alibaba, Google and IBM dominating the global market. While this is great news for the Big Five (who have grown from 73% in 2017 to 77% in 2018), this growth is coming at the expense of smaller providers and it is about time these niche cloud suppliers do something about it.

With the market share of Big Five rapidly increasing, the only way smaller cloud providers like Memset can thrive in the industry is, firstly, through collaboration with other niche technology providers who can offer a fuller stack of services, and secondly by playing to their strengths of personalisation and better customer relationships. It is only by building a ‘community spirit’ among themselves can smaller cloud suppliers tackle the growing competition.

Commenting on the findings, Chris Burden, Chief Commercial Officer at Memset said: “The latest cloud industry report is not all good news. While it is great to know that the industry is growing, the report also exposes the challenges that lay ahead for small cloud providers like Memset. In the light of increasing competition from the Big Five, it has become important that small cloud providers like Memset play to their strengths and collaborate more with other niche players. This is exactly why we are launching our ‘Memset Marketplace’ platform later this year where we aim to build a community network of smaller cloud vendors and offer opportunities to grow with this ecosystem.

“With global organisations betting big on IT outsourcing and ‘as a service’ cloud models, it has become increasingly important that businesses and SMEs opt for multiple cloud suppliers and not just a single hyperscaler. Not only do niche cloud providers offer secure and reliable cloud services, they also tailor their services to suit the client. This personalised and cost-efficient model can definitely not be expected from the Big Five. Another advantage of small cloud vendor is how they pledge to keep data in certain jurisdictions and also provide evidence to their customers that they are meeting those commitments. This has become increasingly important in the light of growing data scandals and data sovereignty issues. Security also often falls short when customers choose to work with a large, hyperscale cloud services providers without an intermediary, because the platforms are complicated and difficult to safely manage without the right in-house technical skills or experience.”

Burden continues: “It is only through collaboration and working with each other can niche cloud providers break the monopoly of the Big Five, and enjoy a bigger slice in an otherwise growing IaaS industry.”

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