According to new research from Canalys, the global technology market analysis firm, enterprise software sales through hyperscaler cloud marketplaces is expected to reach $85 billion, or £66bn~, by 2028.

This marks a considerable jump, considering that in 2023, hyperscaler cloud marketplace sales were $16bn (£12bn~).

The availability of cloud credits for third-party purchases via hyperscaler marketplaces, as well as the emergence of new digital-first buyers, are cited as key factors in changing enterprise customer procurement behaviour.

The Ease of Utilising Cloud Credits

Spend is shifting to the hyperscalers’ marketplaces as customers look to use their cloud credits on third-party software and SaaS.

With enterprises facing continued IT budget pressures, Canalys cited the opportunity to use pre-approved cloud budgets to buy a wide array of software and cybersecurity products—while taking advantage of simplified billing and consolidated purchasing—as highly compelling.

This is also tempting vendors themselves, and from across the technology spectrum too, to sell through the hyperscalers’ marketplaces.

Canalys noted that CrowdStrike and Snowflake were among the first to publicly claim $1bn (£775m~) in total cumulative sales through marketplaces, but a host of the largest software and cybersecurity vendors are actively embracing this trend.

Cisco, Citrix, IBM, NetApp, Nutanix, Red Hat, Salesforce, ServiceNow, and Zoom are cited as just some of the vendors that have launched or grown their sales on the hyperscalers’ marketplaces so far in 2024.

At the same time, many smaller “digital native” independent software vendors built on one of the three top hyperscalers’ cloud platforms are using their respective marketplaces as their primary routes to market.

In terms of marketplaces and sales volume, the research firm’s analysis found that AWS Marketplace is the clear frontrunner, but Microsoft and Google Cloud are focused on closing the gap.

Recommended reading

• Global Infrastructure as a Service Market Grew 16.2% in 2023
• AI and Cloud Dominating Business Priorities in 2024
• Comment | Responsible Cloud Migration

Channel Partners’ Growing Role in Hyperscaler Marketplaces

While most vendor sales through hyperscaler marketplaces are today “direct” to end customers, channel partners are playing, and are set to continue to play, an increasingly important role.

In fact, by 2027, Canalys expects that more than 50% of marketplace sales will be done via channel partners.

Speaking on this aspect, Alastair Edwards, chief analyst at Canalys, said: “Customers often prefer buying through trusted partners for help with managing cloud commitments and accessing professional services and technical expertise when sourcing complex technologies from multiple marketplaces.”

“The channel has concerns about the rise of marketplaces, but both hyperscalers and vendors acknowledge the vital role of channel partners in driving customer adoption and growth.”