Each of the big three cloud providers—Amazon, Microsoft, and Google—recently announced earnings, with Amazon Web Services (AWS) and Microsoft Azure each touting impressive revenue gains. (Google was largely silent on its Google Cloud Platform business.) For AWS, cloud revenue grew 46 percent to put the company on a $27 billion run rate. Microsoft’s growth slowed to 76 percent, but that’s on an estimated $7.7 billion run rate in 2018, with the company’s hybrid cloud story selling well to enterprises.
One thing that’s pumping up those numbers no matter which of the big clouds you analyze: databases.
The money is in (cloud) data
Yes, databases. Given the pull of data gravity, data sat in on-premises database servers for decades, and companies like Oracle and IBM printed money selling them. As more applications move to the cloud, so too is their data and, by extension, the databases in which the data resides.
So much so, in fact, that Gartner is now projecting that 75 percent of all databases will live on a cloud platform by 2023. As Gartner analyst Merv Adrian has pointed out, this shift to the cloud isn’t a zero-sum game of pushing workloads from on-premises deployments to the cloud. Rather, the cloud is growing the overall pie: The database market “grew by nearly 13 percent from 2016 to 2017, to $38.8 billion— its first double-digit year-over-year growth in five years. And change continues—growth is coming from the cloud,” he said.
This transition to cloud is all the more impressive given that old database habits die hard. “The database has the most inertia [of all enterprise software],” said Dremio CMO (and former MongoDB executive) Kelly Stirman. “It’s the hardest thing to move because it has state. And it has the most valuable asset, the data itself.” Or, as Adrian once told me, “The greatest force in legacy DBMS is inertia.”
That inertia helps to explain why Oracle remains a database force despite its inability to make a dent on the cloud, as it continues to lose what little market share it has managed to muster in the cloud. Meanwhile, the Big 3—AWS, Microsoft Azure, and Google Cloud Platform—keep printing cloudy cash on the backs of their superior database investments.
Where database innovation happens: the cloud
As Bloomberg has highlighted, four of the world’s biggest R&D spenders are public cloud companies: AWS, Microsoft, Google, and Apple. Although not all of these companies’ R&D expenditures are cloud-related, much of them are, as Deloitte analyst and InfoWorld columnist David Linthicum has posited, leading to a “forced march” for the industry to the public cloud. Why? Because “most enterprises will move to technology where the real orperceived innovation does occur.”
Today that is public cloud and, by extension, the databases that public cloud providers keep introducing or improving.
This isn’t going unnoticed. According to DB-Engines’ comprehensive ranking of database popularity, the cloud databases keep soaring up the charts. No, none of them threatens to displace Oracle or Microsoft SQL Server anytime soon in terms of overall enterprise adoption, but for the new, innovative workloads that will increasingly differentiate enterprises? Those are going to be all cloud, all of the time.
Of course, there may be a downside.
Just as Oracle once built up a seemingly impregnable fortress of data so too are the public cloud vendors building services that capture more and more enterprise data, potentially prophesying decades of self-inflicted enterprise lockin. The more enterprises choose to embrace those services and associated databases, the more the data will live in their clouds, and the harder it will be to leave. For now, however, enterprises seem too determined to embrace the fast-paced innovation of the clouds to consider the slow-paced exit they may later want to take.