No doubt, hyperscalers are taking over at a striking scale. But what’s the secret to their success? When we say hyperscalers, we mean huge companies like Google, Microsoft, Facebook, Alibaba and Amazon. Dominating cloud services, and expanding their businesses into related areas too.
According to Synergy Research Group, there are currently 24 global companies defined as hyperscalers. Together accounting for 68% of the cloud services sector and operating around 320 data centers worldwide. We expect this number to go up by another 100 by 2018’s end.
These tech giants seem to succeed in dominating private hosted cloud infrastructure services, but this is only part of their vision. The key lies in their own infrastructure’s growth, supporting billions of users.
Hyperscalers’ ambition and investment
One of the key elements that helps hyperscalers develop their infrastructure is having a broad vision for the future. This depends on how much money the company invests. For example, Microsoft revealed its investment of almost 20 billion dollars was essential to support its Azure Cloud platform.
Similarly, both Alibaba and Amazon are leading e-commerce sites that are investing heaving in their own distribution chains too. In fact, IDC analysts say that server revenues, shipments and selling prices all increased in Q1 of 2018.
The ‘Original Design Manufacturer’ approach
According to Synergy: Google, Amazon, Microsoft, Facebook and Alibaba spend about $11 billion on servers, operating systems, storage, networking and virtualization software. Meanwhile, they spend 5% of that on security and management software. Moreover, they develop most of their technology in-house.
This Original-Design-Manufacturer (ODM) approach lets data centers save costs while increasing control and flexibility over hardware implementation. And you guessed it – the supply chain. Not only does this allow providers to save money, but design things in a way that meets their exact requirements.
Hyperscale cloud domination
Large and smaller businesses, are currently coming up with infrastructure solutions that help them with their computing and storage needs. Which makes us wonder – what will happen to the big names once these smaller companies begin to expand?
Maintaining a significant presence in the cloud was and will remain a key factor that contributes to a hyperscaler’s success. With the race for cloud market share heating up, hyperscalers need to continue improving their cloud infrastructure and services.
The future of hyperscale storage
So what should we expect in the future? Will these massive players continue dominating the industry, killing off competition, and possibly disrupting other industries?
One thing’s for sure – hyperscalers are radically changing the online world. The techniques mentioned are only some factors that allowed companies like Google to reach unprecedented heights. We’ve yet to see what the future holds for hyperscalers. But it surely seems to be a bright one.
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2 Comments
Is it possible to disrupt the small companies Hyperscale? Although the advantage of competition is, it should not ignore small industries
Even small companies should be able to hyperscale