Amazon cloud services take a big bite out of Apple’s budget

Apple has been identified as the largest customer of Amazon Web Services, splashing tens of millions of dollars each month on public cloud infrastructure supplied by its rival.

RBC Capital Markets estimates that AWS leads the cloud computing space with about 50% market share.

Apple said previously it has uses AWS for iCloud storage, but has not revealed whether any other Apple services use other third-party clouds or AWS. But Apple look different when it grasps its cloud share, the company not only investing in its iCloud as well as venturing in Amazon's cloud.

iPhone maker Apple and Amazon may be business rivals.

The cloud infrastructure is required for online services, such as iOS App Store, iTunes, Apple Care, ApplePay, iCloud, and a new subscription service for video and magazines.

Early past year, the company announced a $10 billion plan to build multiple data centres in the US.

It's well documented that Apple has been increasing its services as the iPhone approaches saturation in the phone market.

Apple spends more on AWS' cloud services than ride-hailing company Lyft and image-sharing social media company Pinterest. Pinterest will have spent almost $750 million to Amazon for the cloud services at the end of its six-year contract in 2023. As a matter of fact, some analysts estimate that should Apple's investment continue to increase at the same rate, they will most likely spend more than the minimum $1.5 billion mandated in the deal's contract.

Should spending remain unchanged for the remainder of 2019, annual spending on AWS would check in at around $360 million.

For some points of comparison, Pinterest disclosed in its IPO filing that it's spent $309 million with Amazon Web Services since 2017, while Lyft has told investors that it's committed to spending $300 million with AWS by the end of 2021.

  • Wendy Palmer