DataCenterNews Asia - Amazon and Facebook make 2017 the year of hyperscale


Amazon and Facebook make 2017 the year of hyperscale

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,, 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.”

Interested in this topic?
We can put you in touch with an expert.

Follow Us


next-story-thumb Scroll down to read: