Story image

Amazon and Facebook make 2017 the year of hyperscale

09 Mar 18

Hyperscale operator capex boomed in the last quarter of 2017, witnessing a 19% growth over 2016.

This comes from new data from Synergy Research Group which shows that the capex of hyperscale operators totalled $22 billion in the quarter and reached almost $75 billion for the full year.

Much of that hyperscale capex goes towards building and expanding huge data centers, which have now grown in number to 400.

The top five spenders are Google, Microsoft, Amazon, Apple and Facebook, which in aggregate account for over 70% of Q4 hyperscale capex.

On average during 2017, the top five of Google, Amazon, Microsoft, Apple and Facebook spent well over $13 billion per quarter combined.

The report also puts an emphasis on Amazon and Facebook as having particularly strong capex growth in 2017.

Beyond the top five, the report names the hyperscale market’s other major spenders as Alibaba, IBM, Oracle, SAP and Tencent.

Among these five, Alibaba capex more than doubled in 2017, while growth at both Oracle and SAP was also above average.

Other notables outside of the top ten include Baidu, eBay, JD.com, NTT, PayPal, Salesforce, Yahoo Japan and Yahoo/Oath.

Across all hyperscale operators, 2017 capex equated to just over 7% of total revenues, although the ratio varies greatly by company, from a low of 2% to a high of 17% depending on the nature of the business.

Synergy Research Group chief analyst and research director John Dinsdale says over the last four years the firm has seen many companies try and fail to compete with the leading cloud providers.

“The capex analysis emphasizes the biggest reason why those cloud providers are so difficult to challenge.”

“Can you afford to pump at least a billion dollars a quarter into your data center capex budget? If you can’t, then your ability to meaningfully compete with the market leaders is severely limited.”

“Of course, factors other than capex are at play, but the basic financial table stakes are enormous.”

Tensions on the rise after Huawei CFO arrest
“Recently our corporate CFO, Meng Wanzhou, was provisionally detained by the Canadian authorities on behalf of the United States of America."
Why total visibility is the key to zero trust
Over time, the basic zero trust model has evolved and matured into what Forrester calls the Zero Trust eXtended (ZTX) Ecosystem.
Gartner names Proofpoint Leader in enterprise information archiving
The report provides a detailed overview of the enterprise information archiving market and evaluates vendors based on completeness of vision and ability to execute.
QNAP introduces new 10GbE and Thunderbolt 3 NAS series
The new series is supposedly an all-in-one NAS solution for file storage, backup, sharing, synchronisation and centralised management. 
HPE to supply tech to Formula E racing team
“At HPE, we believe the future belongs to the fast, and we’re focused on accelerating what’s next for enterprises, including in the world of auto racing."
Data Exchange Networks achieves world-first
After receiving a new Uptime Institute award, DXN is now the first modular data centre developer in the world equipped to blend different standards.
Why the future of IT infrastructure is always on and always available
As more organisations embrace digital business, infrastructure and operations leaders will need to evolve their strategies and skills to keep up.
Malaysia investing in data-driven future – but obstacles remain
The country has openly expressed its desire to become the prime destination for high-tech industries in Southeast Asia.