Google IO is this week in San Francisco. The first round of announcements out of Google are around developer tools, and a new Big Data services called DataFlow, which is “meant to put standard MapReduce to shame. It’s advertised as a much simpler way to build data pipelines that can handle both batch processing and streaming data.”   According to Gigaom’s own Derrick Harris, who is covering the event.

I suspect that much will flow out of Google IO as the IaaS and PaaS cloud guys at Google show that they have not been just sitting around waiting for AWS to make a mistake for the last year. Indeed, the amount of new features that have gone into the GCE (Google Compute Engine) offering over the last year have been impressive, relative to the early days of their IaaS cloud.

This leads to larger questions about the behavior of the public IaaS marketplace over the next several years. Who will control the market, and to what degree? While most agree it will continue to explode, there are very different opinions about who, what, where, when, and why.

There are a few lines in the sand that I’m willing to draw right now, just on the data points that are coming back to me, as well as what I see in the market. These assertions include:

1. The public IaaS market will grow from about $23 billion to $34 billion, from 2014 to 2015. However, in 2016 we’ll see a decline in the acceleration of growth, with the market only growing to about $42 billion. These are limited to only public IaaS providers, and only those that actually provide core IaaS services.
2. After 2016, we’ll see more blending of cloud-based computing models, including IaaS and PaaS, as well as database and analytical services, security services, governance services, and complete IT systems delivered out of the cloud. Thus, the IaaS-specific features will be much more difficult to determine, and perhaps we won’t even try.
3. AWS will continue to dominate the public IaaS space at least to 2016, and show very strong growth. However, the public IaaS space will equalize around AWS, Microsoft, and Google, with an increasing percentage of share moving to both Microsoft and Google from this year to at least 2016.
4. Google and AWS seem to be courting the same portion of the market, and thus AWS will loose more to Google as the market continues to equalize. However, ongoing, AWS will still turn in stellar cloud numbers, as will Google. It will be a much closer race than many expected.
5. The ability for the cloud computing model to provide better sharing and access will drive enterprises to leverage several brands of clouds to form solutions. This multi-cloud approach will offer opportunities for those public IaaS clouds that have fallen behind, or have not yet caught up, and grab an increasing share of the market.

What should be clear is that I don’t make the assertion that AWS will make any huge mistakes in the marketplace anytime soon. The reason for the success of AWS is around both innovation and operations, and I see no reasons why AWS will not continue to deliver this value and meet or exceed industry expectations.

Indeed, this is not about AWS falling behind, because they won’t. It’s more about Microsoft and Google becoming much better cloud players over the next few years and reclaiming some of the share lost to AWS.

We’re moving away from de-facto leaders in a single market segment, such as IaaS, toward a model that looks more like a traditional buying pattern. This is where those who build and deploy applications go beyond a single brand to choose between best-of-breed services for database, compute, storage, etc., and thus why most enterprises deploy more than one IaaS cloud these days. So, that will typically be AWS and somebody else, but no longer just AWS.

We’re clearly moving to multi-cloud types of architectures, which will give enterprises more choices as to what cloud services to leverage from what cloud provider. With pricing being similar, those who consume cloud services around best-of-breed capabilities could likely drive the equalization of the market.

Microsoft already competes well with AWS, when it comes to developers using a cloud-based relational database. When given the choice, enterprises may find it’s easier and cheaper to turn to a database provider they already leverage, such as the provider of their Azure-delivered SQL server. Of course, this same concept can extend to storage and compute services, as well as specialized technology such as Big Data-oriented systems like Google’s new DataFlow.

A recent 2014 RightScale State of the Cloud Report proved that the movement to multi-cloud is real. As you can see in Figure 1, 74% of those surveyed stated that multi-cloud was their current strategic direction. Indeed, the movement to multi-cloud will largely drive the equalization of the public IaaS, and even the PaaS space. It’s just much easier to leverage several clouds within a single enterprise than it was a few years ago.

Figure 1: According to the recent RightScale 2014 State of the Cloud Report, about 74% of enterprises surveyed are moving toward multi-cloud types of architectures.

This change won’t come without some complications, including the fact that employing more than a single public IaaS provider does bring some complexity to the cloud solutions. However, much of this complexity can be mediated with tools, such as cloud management platforms (CMP). CMPS provide the ability to automate the use of public and private cloud resources by placing an abstraction layer between those who consume the cloud services and the cloud services themselves.

Moreover, it means there will be more costs to train cloud management. Those within enterprise IT will have to understand how to deal with multiple brands of public IaaS providers, or have a few different skillsets. Either will cost more than it would to support a single, homogeneous public IaaS provider.

The benefits of the public IaaS cloud market equalizing around the widespread use of multi-cloud should include continued price competition, and thus the continued lowering of prices. There will be more innovation and investment in the technology, because no single public IaaS cloud player will become the de-facto leader in the space. More options to build and deploy solutions typically leads to better business solutions, and thus to a better return on investment from the use of cloud computing.

No matter what you think of having more than a single, strong public IaaS cloud contender in the exploding IaaS cloud space, the writing on the wall is pretty clear at this point. Many feel the emerging cloud computing market will quickly produce a clear winner. The reality is that the cloud computing model itself supports the concept of choice and sharing, and this will lead us to have more provider choices for the foreseeable future.

We will still award innovation. While the market share of the public IaaS cloud market will certainly shift, those like AWS that continue to provide good technology and good value will continue to thrive. Thus, others that also provide innovation and value will also thrive as well, and together the market will continue to grow rapidly.