IBM misses clout in global Cloud market

Cloud computing has created a cost-effective platform for businesses to upgrade their systems and enhance the functionality at their practices, eventually simplifying their digital transformation journey.
IBM HQ
The rising market opportunity has led cloud players like AWS, Google Cloud Platform, IBM Cloud and Microsoft Azure to partake in a series of competitions based on the software and infrastructure they offer.

IBM has estimated that the combined revenue of Microsoft, Amazon, IBM, Salesforce, SAP, Oracle and Google, in 2018, will surpass $100 billion. IBM, in particular has been upgrading their systems to allow their customers to increase their investments by synching with IBM Cloud Private.

According to Synergy Research Group, Amazon Web Services (AWS) remains the global market leader of public cloud services at 33 percent, followed by Microsoft Azure at 13 percent and Google Cloud Platform at 6 percent.

Due to its leading private cloud services, IBM market share stands at 8 percent but it remains unsure as to whether the big giant stands a chance against the other three, said Synergy Research Group.

Further, IBM’s shares fell 3 percent to $149.15 in the last year. The revenue generated from its technology and cloud platforms business also dropped 5.1 percent, bringing it down to $8.41 billion.

Although, IBM still generates a good amount of cloud revenue, it is severely lacking in other categories pertaining to public cloud services, which is giving rise to other companies.

With this decline in IBM’s market shares, Alibaba, due to its prominence in the Chinese market has reportedly ranked fourth worldwide overtaking IBM, Salesforce and Tencent who has been placed fifth.

The major reason to this usurp is because AWS, Microsoft’s Azure, Google Cloud Platform, and Alibaba Cloud all offer IaaS/PaaS solutions, which are gaining more demand due to their accessible servers. They also have implemented other features analytics and AI to these platforms to produce faster and more efficient results to companies who are relying on their services. IBM however, is still hesitant about upgrading its services and is currently sticking to it IBM Cloud Platform suite.

In addition to this, IBM being a forerunner of using non virtualized infrastructure, has smaller scalability as compared to public cloud servers used by AWS, Microsoft’s Azure, Google Cloud Platform, and Alibaba Cloud. The Public IaaS and PaaS servers being used by the top companies contribute the important segments that add to their revenue, hence giving IBM that much more of a disadvantage and is causing the big giant to lose its customers.

Also, IBM Cloud Private, who reported last year that it was developing into a more interactive system to promote its hybrid cloud growth, needs to upgrade its tools by implementing automatic and accessible packages for its services.

IBM Cloud being known for its expensive services and less partnership deals is also lacking in its core infrastructure. Perhaps, the company has not fully invested in other companies or upgrades that could bring a boost to its market shares. They need to expand their deals and gain productivity by implementing AI into their systems and not only for the development of apps.

Companies like IBM who have so much control over their ownership and underlying infrastructure often fail to provide their customers with the assurance and services that they need.

When customers turn over to cloud applications, they expect the performance of the cloud servers and applications to be at par with their expectations. Failing to do so, will cause customers to lose confidence in them and pave a way for other companies that do provide such systems, a position at the top.

Yadawanka Pala