Who is winning the cloud AI race? Microsoft vs. AWS vs. Google

In short

• 22% of recently announced cloud implementations had an AI element, according to the 188-page Global Cloud Projects Report and Database 2024. The data shows that AI has become a driver for cloud demand, with generative AI (GenAI) playing an increasing role.
• According to the data, Microsoft is leading the overall AI and GenAI race. AWS leads in traditional AI, while Google has the highest share of AI customers.

Why it matters

• For cloud AI providers: The analysis and associated report/database give insights about the current competitive landscape and where customers are looking for cloud AI support.
• For cloud AI adopters: Understanding the current offerings and how vendors are developing their cloud AI offerings can inform current and future enterprise AI projects.

State of cloud AI projects in 2024

A fifth of cloud implementations now have an AI element. The 188-page Global Cloud Projects Report and Database 2024 (published October 2024) shows that between June 2023 and June 2024, over 2,700 new customer case studies were published by the top 5 global hyperscalers, 608 of which use a cloud AI service (22%). The report analyzes over 8,300 customer implementations of the largest cloud vendors of recent years (including deep dives on AI and IoT cloud projects).

Interest in enterprise AI rising. AI has been a technology of interest to enterprises for years, though it has remained out of the top 10 priorities until 2021. It is now a top 5 enterprise technology priority. Supporting this is the surge in CEO boardroom discussions about AI. In fact, in Q3 2024, only the topic of inflation surpassed AI in these discussions.  

As CEOs talk about AI, their teams use cloud AI technology (Example: Intuit). With widespread excitement about generative AI (GenAI), executives have not been shy about discussing some of their company’s AI initiatives in depth. For example, in Q2 2024, Mark Notarainni— Intuit’s chief customer success officer and executive VP—discussed how the company is embedding GenAI features in its accounting software:

“Generative AI is certainly a game changer for us in how you can help customers get prepared for taxes by getting their documents for them, doing work on those documents as you collect those in the platform and shifting our assisted experiences to be much more about advisory and decision-making and almost eliminating the data entry side of it, which is where the traditional market is.”

Mark Notarainni, Chief customer success officer and the executive VP at Intuit (June 2024)

The global cloud project report’s accompanying database* shows that Intuit is just one of 500 companies that have been building their AI stack on top of the AWS cloud, using tools such as AWS Bedrock and AWS SageMaker in conjunction with other AWS tools for the underlying data analytics infrastructure, such as AWS Kinesis.

*Note: The Excel file of over 8,000 cloud projects is available for purchase with Team User and Enterprise Premium licenses.

How representative is the cloud projects report 2024?

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The cloud project report aggregates all 8,374 publicly known cloud implementations to date in one database. Although there are tens of thousands of more projects that have not been made publicly available, the data appears representative enough to draw conclusions regarding the business footprint for each of the 5 vendors and specifically their AI business. The table below shows the 2023 public cloud market share (according to IoT Analytics’ own model) compared to the share of public customer references (for public cloud and new cloud AI projects) in the database that accompanies the report.

The share of overall cloud and cloud AI projects in the list is largely comparable to the actual market share of the vendors (although some deviations remain). The data provides a comprehensive snapshot of how the customer footprint of these companies varies by industry, region, and customer size, and they reveal some key customers in each vertical. IoT Analytics was also able to verify with various experts in the field that the 2023 version of the global cloud projects report appeared to be representative of the actual customer footprint of these vendors.

Comparing the hyperscalers’ new cloud AI offerings: Microsoft vs. AWS vs. Google

1. All cloud AI projects

Total number of AI case studies

Microsoft has added the most AI case studies. Among the 608 new cloud AI case studies, Microsoft had the most, with 274 case studies identified (45% of the 608). New AI customer wins in the analysis timeframe include insurance giant AXA, professional services company KPMG, industrial automation company Schneider Electric, and brewing company Heineken. AWS was second in this regard, with 207 (34%). Electronics giant Samsung and food and beverage manufacturer Nestlé were two notable new AWS AI customers. Google came in third with 102 (17%), adding customers such as pharmaceutical company Merck and travel agency Priceline.com. AWS had the highest number of traditional AI case studies—i.e., not counting GenAI—at 176. Of note, Google had the highest share of new AI case studies compared to new overall cloud case studies—102 of 280 (36%).

Number of AI case studies relative to market share

Microsoft has the largest percentage point (pp) gap between the share of new case studies and market share. AWS’s share of new cloud AI case studies (34%) is 3 pp lower than its 2023 cloud market share of 37%. Google’s case study share of 17% is 8 pp higher than its cloud market share of 9%, while Microsoft’s case study share of 45% is 16 pp higher than its 29% cloud market share. Microsoft and Google are thus outperforming their cloud market share.

2. Cloud GenAI projects

206 new GenAI case studies. The global cloud projects report and database includes 206 new GenAI case studies—34% of overall AI case studies.

Total number of cloud GenAI case studies

Microsoft leads with the most cloud GenAI case studies. Of the 206 cloud GenAI case studies, Microsoft takes a clear lead with 127 case studies (62% of the 206). Google is second in this regard, with 37 case studies (18%), and AWS has 33 (16%).

Number or GenAI case study relative to market share

Microsoft’s share of new cloud GenAI case studies far outweighs its cloud market share. AWS’s share of new cloud GenAI case studies (16%) is 21 pp lower than its 2023 cloud market share of 37%. Google’s case study share of 18% is 9 pp higher than its cloud market share of 9%, while Microsoft’s 62% share of new GenAI case studies was 33 pp higher than its 29% cloud market share.  Once again, Microsoft outperforms its peers in this aspect of the cloud AI race.

Analyst takeaway: Who is winning the cloud AI race?

Microsoft leads the cloud AI race in general and the GenAI race—for now. As it stands, when comparing new cloud AI case studies against overall cloud cast studies, Microsoft has a clear lead in the race and might remain so in the near term. Helping boost Microsoft into this spot is its significant lead in cloud GenAI, driven by its close relationship with OpenAI. Microsoft was a massive backer of OpenAI in 2019, and in January 2023 (less than two months since ChatGPT became publicly available), it expanded the relationship by increasing investment and making the Azure OpenAI service generally available. Many large enterprises have initiated their first GenAI projects on top of a Microsoft AI stack. However, with several LLMs closing the performance gap with OpenAI models, it remains to be seen if Microsoft’s early mover advantage fades or remains.

AWS leads with traditional AI. When cloud GenAI projects are removed from the overall cloud AI umbrella, the picture becomes different. AWS is the leader in terms of traditional cloud AI (i.e., cloud AI case studies without a GenAI element). Coinciding with this, AWS’s Amazon SageMaker—an AI/ML platform—was the most included product at 21% of cloud AI case studies. As AWS further develops its cloud AI offerings (especially GenAI), it could start upselling these services to its current and new customer base, see more cloud AI projects, and gain a larger share of new projects.

Google has the highest share of AI customers. Google, which has traditionally been popular with smaller-sized companies, also has its own strength in the cloud AI race. When looking at new case studies for each vendor, Google had the largest share of cloud AI case studies relative to its overall new case study count. 36% of Google’s new public cloud case studies make use of a cloud AI product, implying that AI is a bigger driver for Google Cloud than it is for any of the other hyperscalers.

AI is driving cloud demand, but there are other drivers. Looking ahead generally, enterprise appetite for AI applications will be pivotal, and the vendors offering the most or best services to support those projects stand to see market gains. However, while AI is expected to climb from the 8th-ranked enterprise technology priority in 2024 to the 4th in 2025, cybersecurity has been and is expected to remain the top priority for the foreseeable future. This, and many more cloud project insights, is reflected in the Global Cloud Projects Report and Database 2024 as well—when discounting new cloud AI case studies, cloud security services (such as Microsoft Sentinel and Google Cloud Armor) are among the fastest-growing products over the past year.

Disclosure

Companies mentioned in this article—along with their products—are used as examples to showcase market developments. No company paid or received preferential treatment in this article, and it is at the discretion of the analyst to select which examples are used. IoT Analytics makes efforts to vary the companies and products mentioned to help shine attention to the numerous IoT and related technology market players.

It is worth noting that IoT Analytics may have commercial relationships with some companies mentioned in its articles, as some companies license IoT Analytics market research. However, for confidentiality, IoT Analytics cannot disclose individual relationships. Please contact compliance(at)iot-analytics.com for any questions or concerns on this front.

More information and further reading

Are you interested in learning more about the cloud market?

Global Cloud Projects Report and Database 2024

A structured repository of 8,374 projects from five of the largest cloud vendors, accompanied by a 188-page report analyzing customer implementations, including a deep dive into IoT and GenAI cloud projects.

Download the sample to learn more about the report structure, select definitions, select data, additional data points, trends, and more.

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