Microsoft CEO Satya Nadella.
Microsoft CEO Satya Nadella.

Tech giants everywhere are fighting for their slice of the cloud pie, but Microsoft CEO Satya Nadella said during an on stage interview at Dell World this week that it’s starting to look like Microsoft and Amazon are running away with the competition.

“It’s a Seattle race,” he said at the high-profile Austin, Texas event. “Amazon clearly is the leader, but we are No. 2. We have a huge run-rate. All up, our cloud business last time we talked about it was over $8 billion of run-rate.”

Nadella has been talking up the company’s growing cloud business since before he was CEO, back when he was the vice president in charge of the blossoming Azure platform. But now, he says he doesn’t have to talk about some distant future.

“We’re the biggest [software as a service] vendor today,” he said.

It’s quite a claim, dismissing competitors like Google, IBM and Rackspace. But it doesn’t without some backup.

HP, which recently doubled down on its bid for an increased presence in the cloud, announced yesterday it’s shuttering its Helion Public Cloud altogether. It, like most tech titans, has struggled to find its place in a market increasingly dominated by a couple major players.

The Gartner research firm came to a similar conclusion last time it put out its Magic Quadrant for Cloud Infrastructure as a Service report in May.

Gartner's
Gartner’s Magic Quadrant for Cloud Infrastructure as a Service Report.

It found that Amazon Web Services is still by far the industry leader, with 10 times more cloud compute capacity in use than the next 14 contenders — including Microsoft —combined.

But Microsoft’s Azure took the No. 2 spot on Gartner’s report. It found that the company has leveraged its longstanding reputation with enterprise customers to pickup ground in a hurry, offering products that roll cloud infrastructure and the software that runs there into one unified package.

Meanwhile, Google, the report found is in the “rudimentary stages of learning to engage with enterprise and midmarket customers.”

Microsoft, Amazon and Google, will each unveil more details on their cloud businesses later today when they report earnings after the markets close. All three tech giants have identified the cloud as a major focus moving forward, so you can be certain that will be one race investors will be watching closely.

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