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Amazon Web Services’ growth “could moderate this year and next” amid rising competition from Microsoft and Google, according to a new research note from Pacific Crest Securities.

The firm is slightly reducing its target for Amazon’s overall share price as a result, to $895/share from $905/share previously. It’s another sign of how important the AWS business has become to Amazon’s overall financial picture, with more than $12 billion in revenue from AWS last year. Amazon is down slightly in trading today, around $853/share at the time of publication.

The research note, by Pacific Crest senior research analyst Brent Bracelin and colleagues, cites new momentum for Microsoft Azure, especially within large companies and government agencies that are shifting away from privately operated data centers to public cloud providers. The note also cites recent customer wins by Google Cloud, including Snapchat, Colgate-Palmolive, HSBC, eBay, Schlumberger and Verizon.

But Pacific Crest remains bullish on AWS overall, noting that its early lead in Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) continues to give it a first-mover advantage.

“Even though we are seeing Microsoft Azure and Google Cloud make some slight gains on the margin, the sheer size advantage that AWS has amassed today creates a high bar for competitors to narrow its outsized revenue lead,” the Pacific Crest research note says. “Ultimately, the law of large numbers and data gravity for these usage-based models will make it challenging for competitors to catch up within any single year, which suggests that the race to catch AWS will be a multiyear and multi-billion-dollar endeavor.”

Meanwhile, Oracle is continuing to pursue AWS, as well, citing new momentum in its own cloud business in its earnings report this week.

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