The volume of the European market for cloud services is five times larger today than at the beginning of 2017, according to the research company Synergy Research. In the second quarter of 2022, total revenues from cloud services in the region reached €10.4 billion.
Analysts estimate that in the period April-June 2022, European cloud providers increased their cloud service revenues by 167%. At the same time, their market share fell from 27% to 13% over the five-year period as they lagged behind the global market as a whole in terms of growth rates.
Amazon, Microsoft and Google the main beneficiaries of the growth of the cloud market, according to the analysis. The combined share of these three leading global cloud service providers in Europe today reaches 72% and continues to grow steadily.
Among European cloud providers, SAP and Deutsche Telekom are in the lead, each accounting for 2% of revenues in the regional market. They are followed by OVHcloud, Telecom Italia, Orange and a long list of national and regional players. The rest of the European market is occupied by small American and Asian cloud providers, whose total share is constantly decreasing.
In the last four quarters, revenues from cloud infrastructure services in Europe (including IaaS, PaaS and private cloud services) exceeded €27 billion, up 41% from the previous four quarters. More than 80% of the market turnover comes from IaaS and PaaS services.
Moreover, growth rates in these areas are higher than in the private cloud segment. Among the most dynamically developing market sectors, analysts note PaaS with database services, IoT and analytical services.
Commenting on the survey, Synergy Research Group Principal Analyst John Dinsdale noted that the cloud market is a game of scale where leadership contenders must make huge financial bets, have a long-term investment and profit strategy, remain focused and determined to succeed and also so that they constantly achieve the highest level of professionalism in their activities.
According to the specialist, none of the European suppliers has come close to this set of criteria. As a result, the six market leaders are companies from the USA.
“US cloud providers continue to invest more than €4 billion per quarter in European capital investment programs. This peak cannot be conquered by anyone who wants to seriously challenge the leaders and fight for market supremacy”, commented Dinsdale.
As a result, European cloud service providers have focused primarily on serving local groups of customers with certain specific needs, sometimes partnering with large US cloud operators. Some of these European suppliers will continue to grow, but are unlikely to change their overall share much, Dinsdale sums up.