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Amazon-Gogo's AWS Collaboration to Intensify Cloud Battle

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Amazon’s (AMZN - Free Report) cloud clientele continues to strengthen as evident from inflight Internet company Gogo’s (GOGO - Free Report) latest decision to go all-in on Amazon Web Services (“AWS”).

Gogo is set to shift its entire infrastructure to AWS is order to improvise cost structure and achieve better work efficiency by utilizing AWS storage, database, analytics and serverless services. Meanwhile, the company has already shifted its commercial and business aviation division.

The deal lends AWS a competitive edge against the likes of Microsoft’s (MSFT - Free Report) Azure, Alphabet’s (GOOGL - Free Report) Google Cloud and Alibaba’s cloud platform.

Portfolio Strength to Aid AWS Growth

Amazon’s continual efforts toward innovation and expansion are likely to help it maintain its cloud market lead.

AWS plans to acquire CloudEndure, which offers recovery services for cloud data during cyberattacks. Notably, this diversifies the company’s offerings by adding disaster-resilient services.

The company’s recently-introduced Amazon DocumentDB is a document database service that is compatible with MongoDB applications and tools. It offers scalability and availability to customers which help manage critical MongoDB workload.

Also, recently-launched centralized backup service, AWS Backup, will offer customers an automatic and continuous data backup to meet business and regulatory requirements.

The company’s AWS RoboMaker is also available now. The service helps in development, testing and deployment of robotic applications.

Amazon Reigns Supreme, Others Catching Up

Amazon remains the dominant player in the cloud space.

Per a report from Synergy Research Group, AWS continued to lead the cloud market in fourth-quarter 2018 with a 34% share. The addition of Ellie Mae, Korean Air, Santander’s Openbank, Pac-12, Mobileye, Guardian Life Insurance, Amgen and National Australia Bank as clients provided a huge impetus.

In comparison, Azure, Google Cloud and Alibaba Cloud acquired a respective 15%, 7% and 5% share of the market. However, the report shows that these companies are working on bridging the gap pretty fast.

Azure continued to strengthen with big names like Volkswagen, Starbucks, Walgreens Anheuser-Busch In Bev, The Kroger and Mastercard making their way to its client list last quarter.

Additionally, Microsoft and LG Electronics inked a deal at CES 2019. Per the agreement, Microsoft’s Azure cloud platform and AI capabilities will be utilized by LG to enhance its self-driving software. The partnership adds to Azure’s growing clout.

Further, Google and Alibaba’s cloud platforms are gaining traction in the market on their strengthening range of product offerings.

Recently, Alibaba Cloud unveiled seven solutions along with several powerful infrastructure enhancements to support intelligent businesses at a global scale.

Meanwhile, Google’s sustained focus on innovation of AI and machine learning (ML) techniques are enhancing its cloud offerings.

Can Expanding Clientele Counter Threats?

We believe increasing adoption rate of AWS will continue to strengthen market position and drive the top line.

Apart from Gogo, Lyft also picked AWS to fortify its position in the ridesharing marketplace. Lyft is leveraging on AWS’ database, serverless services, machine learning and analytics services. It uses Amazon DynamoDB, EKS, AWS Lambda, Redshift and S3 to support everyday business workload.

Additionally, Choice Hotels International selected AWS to migrate more than 1,000 technology applications to AWS in order to achieve scalability and operational efficiency through AWS’ machine learning and analytics services.

Currently, Amazon carries a Zacks Rank#3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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