Semiconductor and Supply Chain Shortages Limit Data Center Buildouts

Incline Village, NV.  August 23, 2021 —  According to a newly released report issued by the 650 Group, US hyperscaler cloud market revenue grew 43% Y/Y in 2Q21 while the supply chain for Data Center Equipment into hyperscalers performed unevenly due to continued semiconductor and component shortages.  

650 Group’s Cloud Report covers Colocation, Infrastructure as a Service (IaaS), SaaS, and Search & Social for companies such as Amazon, Apple, Facebook, Google and Microsoft.

“2Q21 IaaS revenue hit a record, far exceeding 4Q20’s previous revenue record,” said Alan Weckel, founding analyst for 650 Group. “IaaS continues to increase in influence throughout the entire component and semiconductor supply chain.  The number of applications that enterprises and consumers use each day continues to increase, and the majority of those applications exist in hyperscalers IaaS data centers.  Many critical components for cloud data center build-outs during the quarter remain constrained.”

2Q’21 Highlights:
o    Search and Social revenue surges.  Google and Facebook remain dominant, but the rest of the market shows signs of gaining ground
o    IaaS revenue growth was robust as many enterprises rely on the cloud to support their new-normal hybrid workforce and environments
o    US Hyperscaler made approximately $1M in cloud revenue every minute during 2Q21
o    Supply Constraints remain in 2Q21 related to COVID-19 and trade war events
o    Hyperscalers are poised to ramp next-generation server and networking architectures over the next two years
o    US Hyperscaler Revenue is Nearly 10X the size of Chinese Hyperscaler Revenue in 1H21
o    US Hyperscaler influence on the supply chain is increasing

The Cloud reports include CAPEX studies for the Colocation, IaaS, SaaS, and Search and Social Media markets, including a unique look at spending specifically for data center equipment.  Going beyond just cloud revenue provides a unique look into where and how the largest cloud providers deploy equipment.  In the report, you can see the trend towards more CAPEX spending occurring in IaaS as many SaaS providers choose IaaS instead of building out their own infrastructure.

About 650 Group 650 Group is a leading Market Intelligence Research firm for communications, data center, and cloud markets.  ​Our team has decades of research experience, has worked in the technology industry, and is actively involved in standards bodies.  650 Group focuses on leading-edge market trends and research and prides itself on first to market research with over 12 research programs focused on Cloud trends.

Profits Remain Elusive as Cloud Providers Target Revenue Growth over Profitability

INCLINE VILLAGE, NV, Feb. 22, 2021 - According to a new report published by 650 Group, titled: IaaS Hyperscaler SWOT Report 2020-2025, IaaS revenue grew to over $100 B in 2020 and $50 B in Capital Expenditures for data center equipment (servers, storage, networking) and other compute and IT equipment.  Amazon AWS, Microsoft Azure, and Google GCP made up over 60% of the revenue with Alibaba being the largest non-US provider.

AWS brought in $86,000 per minute in revenue and made $26,000 per minute in profit dollars.  While GCP, in third place, brought in $3,300 per minute in revenue while losing $1,400 per minute in 2020.  Additionally, 2020 saw Alibaba record its first profitable quarter.

"While revenue continues to surge for IaaS as many businesses rely on it as a foundational building block for their data, profit dollars remain challenging as companies look to grow and expand instead of relying solely of profit to make investment decisions," said Alan Weckel, Founding Technology Analyst at 650 Group.

Continued Weckel: "2021 is shaping up as an important battle of US IaaS hyperscalers as they invest to their strengths to continuing expanding.  The battle for Artificial Intelligence (AI/ML) with IaaS providers is presently in its infancy with many suppliers vying for position for the underlying technology."

Purchase the Report:
650 Group offers this report for $995 to a single user at a single company and $1,995 to a group of five users at a single company and have additional options for redistribution and external use of the data.  To purchase:  https://650group.com/IaaS-Hyperscaler-SWOT-report.html

Companies covered in the report include hyperscale cloud providers Amazon Web Services (AWS), Microsoft Azure, Google GCP in addition to IaaS comparisons with IBM, Oracle, and Alibaba. The report also discusses the strengths, weaknesses, opportunities, and threats of the US Top-3 IaaS hyperscalers.

About 650 Group
650 Group is a leading Market Intelligence Research firm for communications, data center, and cloud markets.  Our team has decades of research experience, has worked in the technology industry, and is actively involved in standards bodies.  650 Group focuses on leading-edge market trends and research and prides itself on first to market research with numerous research programs focused on Cloud and technology trends. For more information, visit: http://www.650group.com
 
For more information, contact:
650 Group Media Relations:
Greg Cross
greg@650group.com

Enterprise and Consumer’s Use of Cloud Resources Changing to the New Normal because of COVID-19

PORTOLA VALLEY, Calif.  Aug. 5, 2020 —  According to a newly released report issued by founding analysts of 650 Group, US Hyperscaler Cloud market revenue grew 11% Y/Y in 2Q’20 while the supply chain for Data Center Equipment into Hyperscalers performed unevenly due to shifting lead times and trade war impacts.

650 Group’s Cloud Report covers Colocation, IaaS, SaaS, and Search & Social.

2Q’20 Highlights:
* o    Search and Social revenue growth was uneven based on the change of viewing habits of consumers from COVID-19 as advertisers and consumers shifted behavior significantly during the quarter
* o    IaaS revenue growth was robust led by most surge capacity placed in IaaS companies' infrastructure instead of their own build-outs
* o    Four of the five largest hyperscalers are under US government scrutiny for monopolistic behavior
* o    Market capitalization is averaging over $1 Trillion for this group of companies
* o    Supply constraints remain in 3Q’20 related to COVID-19 and trade war events
* o    Hyperscalers are poised to ramp next-generation server and networking architectures over the next two years
* o    US hyperscaler revenue is nearly 10X the size compared to Chinese hyperscaler revenue in 1H’20
* o    US hyperscaler influence on the supply chain is increasing

The 650 Group Cloud Reports include CAPEX studies for the Colocation, IaaS, SaaS, and Search and Social Media markets, including a unique look at spending specifically for data center equipment.  Going beyond just cloud revenue provides a unique look into where and how the largest cloud providers deploy equipment.  In the report, you can see the trend towards more CAPEX spending occurring in IaaS as many SaaS providers choose IaaS instead of building out their own infrastructure.

“2Q20 IaaS cloud hit a record, far exceeding 4Q’19’s previous revenue record and over twice the revenue from just three years ago,” said Alan Weckel, founding analyst for 650 Group. “US trade war activities, mainly against Huawei, caused significant lead time increases in many critical components for cloud data center build-outs during the quarter as the 5G battle against China is having ripple effects into the cloud supply chain.”

About 650 Group 650 Group (www.650group.com) is a leading Market Intelligence Research firm for communications, data center, and cloud markets.  ​Our team has decades of research experience, has worked in the technology industry, and is actively involved in standards bodies.  650 Group focuses on leading-edge market trends and research and prides itself on first to market research with over 12 research programs focused on Cloud trends.

ASIC Diversity at the Leaf/Spine and DCI Core Key to 400 Gbps at Apple, AWS, Facebook, Google and Microsoft Azure


PORTOLA VALLEY, Calif.– June 22, 2020 – A newly released report by 650 Group, a leading Market Intelligence Research firm for communications, data center, and cloud markets, indicates that the ASIC segment of the data center switching market is rapidly migrating to 12.8 Tbps and 56 Gbps SERDES based products.  The report also showed significant evaluations occurring at each of the hyperscalers at the ASIC and system level for both Top-of-Rack (Leaf / Spine) L2 ASICs and L3+ ASICs for the Core (DCI, Metro Spine).

“1Q20 recorded record shipments in 400 Gbps and strong 100 Gbps demand in the hysperscalers,” said Alan Weckel, Founder and Technology Analyst at 650 Group.  “ASIC diversity is critical to hyperscalers goal of a diversified supply chain. Historically Cloud providers would pick the same ASIC and have multiply vendors manufacture a switch platform. With current-generation products, hyperscalers are pushing towards additional ASIC diversity.”'

The 650 Group Quarterly Merchant Silicon report also indicates what impact the industry standards bodies efforts on 224 Gbps SERDES and co-packaging on the Ethernet Switch and Router markets.  The report highlights the migration away from 10 Gbps ports to 25 Gbps ports in the enterprise and the Cloud migration towards 100 Gbps and 400 Gbps.

About the Merchant Silicon Quarterly Report
The Merchant Silicon Quarterly Report offers a market assessment of vendor performance and market share in the ASICs that sell into the Ethernet Switch market.  The report covers ASICs by SERDES speed and tracks companies like Broadcom, Innovium, Intel (Barefoot), Nvidia(Mellanox) as well as other ASICs sold into the data center.  For more information about the report, contact the sales department at 650 Group at +1 650 600 7104 or val@650group.com.

About 650 Group
650 Group is a leading Market Intelligence Research firm for communications, data center, and cloud markets.  ​Our team has decades of research experience, has worked in the technology industry, and is actively involved in standards bodies. Learn more at http://www.650group.com

Surge Spending and Different Usage Patterns Change 2020 and 2021 CAPEX Trends

PORTOLA VALLEY, Calif.  May 5, 2020 —  According to a newly released report issued by founding analysts of 650 Group, the US Hyperscaler Cloud market revenue grew 20% Y/Y in Q1’20 while CAPEX used for Data Center Equipment grew unevenly during the same timeframe.

650 Group’s Cloud Report covers Colocation, IaaS, SaaS, and Search & Social.

Q1’20 Highlights:
* o    Revenue Growth for US Hyperscalers was the slowest it has been in a decade
* o    The majority of Cloud Providers lowered CAPEX projections for 2020
* o    US Hyperscaler Cloud providers are running their servers and networks more efficiently compared to 2019, allowing them to surge capacity at a faster rate than DC buildouts
* o    Surge capacity in Q1’20 was very different between Search and Social companies like Facebook and Google and IaaS companies like Amazon and Microsoft.
* o    Capital Equipment Expenditures were constrained by supply constraints related to COVID-19; supply constraints remain in 2Q’20

The Cloud reports include CAPEX studies for the Colocation, IaaS, SaaS, and Search and Social Media markets, including a unique look at spending specifically for data center equipment.  Going beyond just Cloud revenue provides a unique look into where and how the largest Cloud providers deploy equipment.  In the report, you can see the trend towards more CAPEX spending occurring in IaaS as many SaaS providers choose IaaS instead of building out their own infrastructure.

“Q1’20 Cloud results diverged from normal seasonality as the world rapidly shifted to work-from-home and remote forms of social and society interaction,” said Alan Weckel, founding analyst for 650 Group. “Cloud-based companies became increasingly important to society as social norms changed rapidly during Q1’20.  For businesses, the use of Cloud services becomes even more important in all verticals.  As we look towards the second half of 2020, companies that better use cloud resources to do business will emerge in a stronger position.”
For more information about the report, contact the sales department at 650 Group at +1 650 600 7104 or val@650group.com or www.650group.com
About 650 Group 650 Group is a leading Market Intelligence Research firm for communications, data center, and cloud markets.  ​Our team has decades of research experience, has worked in the technology industry, and is actively involved in standards bodies.  650 Group focuses on leading-edge market trends and research and prides itself on first to market research.