Top 11 Cloud Companies Versus IDC and Gartner estimated market sizes

The purpose of the table below is to estimate very roughly how much business in terms of revenues the cloud  companies collect today. Then I compared these numbers to much publicized IDC $56B per year and Gartner $146B per year. Assumptions:
  • I included top 10 2009 companies, top 15 2010 both from Network World
  • I added new names suggested by contributors to Google cloud computing discussion group (over 40,000 readers) 
  • I added the company  names suggested as comments to my previous blog entry
  • I divided the revenues as "Licenses sales and Services", "Hardware Sales" considered for Oracle only and advertising income, which is key
  • My research for revenues is minimal and I used these simplifications
    • Any cloud company that does not disclose revenues, gets $10M per year default assumption. This is generous for many start-ups, usually struggling with the first millions,and could be an underestimate for some other companies. Overall the number is adequate
    • Google advertising data is from published data
    • Oracle cloud income come from their estimated business on Amazon. and "cloud-in-box" future sales
    • The table does not list other hardware vendors, who also supply cloud service companies: Dell, HP, IBM
    • The table does not include Hadoop and analytics companies, as promising startups, like Cloudera are struggling to find a business model. If we include Cloudera and assign a default $10M in revenues, it will make no difference in final conclusion
Looking at the data, here are some starling conclusions:
  1. The 29 companies listed had revenues in Licenses ad Services just over $10B per year.That is barely 19% of the total market estimate of IDC ($56B per year). As most cloud companies are software and services, the current market size could be, say $15B , but not$ 56B !!!
  2. The discrepancy may be that IDC counted the hardware sold by Dell, IBM, HP, Sun (now Oracle) as part of the cloud market. Thus is a fuzzy assumption, as one does not know for sure, whether the 1,500 boxes Sales Force bought are the part of the cloud market, just 10,000 more servers were sold to other enterprises where we may guess will be used for clouds
  3. The definition of "cloud-in-a-box" will make easier to include the hardware as part of the cloud market
  4. The advertising revenues in cloud market size is 3x larger than software and services revenues
  5. In terms of revenues, Google and Yahoo pocket three quarters of the entire cloud revenues, almost exclusively through advertising and marketing services
  6. 11 companies in the next bullet capture almost 100% of the total revenues.



    • Google
    • YAHOO
    • Salesforce.com
    • Microsoft
    • Oracle
    • Amazon
    • SAVVIS
    • GoGrid
    • NetSuite
    • Rackspace
    • RightScale

    All the other 18 companies share a meager 0.5% of the market :-(
    Not much left over  from cloud sw and service market ?
     The take away is this: we usually call any company providing software and  service for cloud industry. This market is still very small and it is 10% of the total Gartner number including marketing services and add revenues. (Assumed $15B versus $146B per year)
    For all practical purposes, the cloud market for software and services is $15B maximum. This is realistic. This is what we should plan before. Don't base your business plan on market share, but on named customers, say 20, that you know for sure will buy from you once you have the product ready
    As earliest cloud adopters, Google and Yahoo cleaned the bulk of the revenues that go into their pockets comfortably


Revenues (US$ millions per year)

Company Lic & Services Hw Adds Total % Total Cum.
Google 762
23,000 23,762 59% 59%
YAHOO 100
6,000 6,100 15% 74%
Salesforce.com 5,000

5,000 12% 86%
Microsoft 2,000

2,000 5% 91%
Oracle 800 1,000
1,800 4% 96%
Amazon 600

600 1% 97%
SAVVIS 300

300 1% 98%
GoGrid 250

250 1% 99%
NetSuite 200

200 0% 99%
Rackspace 100

100 0% 99%
RightScale 100

100 0% 100%
Enomaly 10

10 0% 100%
Abiquo 10

10 0% 100%
Boom! 10

10 0% 100%
Cloudshare 10

10 0% 100%
Crosscheck Networks 10

10 0% 100%
Elastra 10

10 0% 100%
Egnyte 10

10 0% 100%
Good Data 10

10 0% 100%
Kaevo 10

10 0% 100%
Nasuni 10

10 0% 100%
Navajo Systems 10

10 0% 100%
Symplified 10

10 0% 100%
Terremark Worldwide 10

10 0% 100%
Viewfinity 10

10 0% 100%
Virtual Ark 10

10 0% 100%
VMlogix 10

10 0% 100%
CloudSwitch 10

10 0% 100%
Greenqloud 0

0 0% 100%
T O T A L 10,382 1,000 29,000 40,382








Market Estimate, no advertising IDC 56,000




Market Estimate with Advertising, Gartner


146,000

% 19%

28%




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