Cloud Infrastructure Market: Google Weighs in on Microsoft Cloud Business in Leaked Doc

Google implies that the company's cloud service may be ahead of Microsoft as one of the biggest competitors in the cloud industry.

Cloud Infrastructure Market: Google Weighs in on Microsoft Cloud Business in Leaked Doc

Andi C., Tech Times 21 December 2022, 04:12 pm Google's internal estimates imply they could take the lead over Microsoft in the could industry. Platforms as a service or infrastructure as a service can both be excellent places to start. However, two of the biggest clouds, Microsoft Azure and Google Cloud, provide numerous possibilities.

To prevent Amazon Web Services from dominating the market, the e-commerce business created in 2006, Google and Microsoft have made significant investments. However, CNBC reports that a Google internal estimate implies that the company believes it is closer to second place than analysts assume. The estimate was created based on a stolen Microsoft document and other market figures.

As the largest and best-capitalized U.S. tech companies compete for contracts with big businesses and government organizations, which are increasingly moving their critical computing and storage needs outside of their own data centers, the cloud represents one of the most high-stakes technological battles. CRN reveals that tech companies Amazon, Microsoft, and Google collectively control 76 percent of the enterprise cloud services market in the United States, a share that is steadily rising.

These three cloud companies reportedly accounted for 66 percent of all enterprise cloud infrastructure spending globally, which surpassed $57 billion in the third quarter of 2022. Amazon Web Services is the market leader for enterprise cloud services globally, holding a 34 percent market share as of the third quarter of 2022. Meanwhile, in the third quarter, Microsoft held a 21% share of the worldwide cloud services market, while Google Cloud held an 11% share.

Read Also: Microsoft Under Fire After Leaking 2.4TB of Data From Customers Including Contracts, Emails, and More Google's Take on Microsoft Cloud Business in Leaked Doc According to Insider, Microsoft's last fiscal year in its Cloud division generated $75.2 billion in revenue. However, because of the unit's brevity, it is challenging to assess Azure's performance in comparison to rivals like the market leader Amazon Web Services, which generated $62.2 billion in revenue in 2021. However, a Google internal assessment shows that the company believes it is closer to the second position than experts assume, based on extrapolation of other market numbers from a leaked Microsoft document.

Based on the leaked document, Microsoft produced less than $29 billion in consumption income from Azure in its most recent fiscal year, which concluded on June 30. This figure reflects the value of the cloud infrastructure services used by customers.  "Analysts include revenue allocations from EMS and Power BI, both of which are highly profitable SaaS businesses with estimated gross margins above 80%," Google's document says. "For a realistic analysis of Azure's profitability these allocations have to be removed." The document from Google has Azure ending the 2022 fiscal year with an operating loss of almost $3 billion, down from a loss of more than $5 billion the prior year.

It claims Azure's sales and marketing costs approached $10 billion, accounting for 34% of consumption revenue. This is based on the US SEC's sales and marketing costs for Microsoft's equaled 11% of revenue over the same period. Related Article: Microsoft Detects a Significant Growth in Linux XorDDos Malware ⓒ 2022 All rights reserved.

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