Hyperscalers like Amazon Web Services (AWS), Microsoft, and Google Cloud have all but cornered the large enterprise and government agency verticals, but that doesn't mean the game is over for smaller cloud providers, according to Forrester Principal Analyst Lee Sustar. “The global cloud market is far broader than the top players,” he explained in a blog.

The market research firm's Q4 2022 report on public cloud development and infrastructure platforms concluded hyperscalers' “sheer breadth of offering might best align with the needs of large enterprises and big government agencies,” however, “other cloud providers can succeed with more discrete approaches to the market around data, analytics, development, and integration,” Sustar wrote.

As the multicloud approach remains favored by growing enterprises avoiding vendor lock-in, “they’re exploring alternatives” for general purpose IT and artificial intelligence (AI) or machine learning (ML) workloads, he added.

Data and analytics are the most competitive “key battlegrounds” in the public cloud market, which Forrester expects will be worth more than $1 trillion by 2026. Since small percentages of market share could make or break a cloud provider, they're focusing on these higher-revenue data and analytics services.

“It’s more revenue to feed the never-ending hyperscaler build-out and keeps non-hyperscalers in the cloud game,” Sustar noted. “That’s good news for customers who increasingly demand services that enhance these capabilities and make them easier to adopt within their businesses.” It also pushes cloud providers beyond the traditional realm of IT operations “and into the lifeblood of customers’ organizations,” he added.

The report also found major cloud providers are significantly improving their security services. “Security consoles that once offered little more than a convenient portal are now festooned with functionality that would please even the most cynical security operations center pro,” Sustar said.

While the approach to security varies from silicon-centric for isolation and confidential computing to multicloud service offerings, “these are welcome developments for organizations seeking better alignment between security and cloud operations,” he noted.