Platformonomics - Follow the CAPEX: The Clown Car Race Checkered Flag
platformonomics.com/2024/04/follow-the-capex-the-clown-car-race-checkered-flag
What Jamie wrote
Great article that looks at the capital investment being made by cloud providers to check their PR messaging with the investment. The article is fundamentally highlighting that Oracle and IBM are just not in this market in any real way, but the real amazing thing to me is the amount of capital that AWS, Microsoft, and Google are continuously driving into their massive cloud operations.
In 2023, AWS spent $24.8 billion on CAPEX (over four times Oracle), Google spent $32.3 billion (over five times Oracle), and Microsoft $41.2 billion (almost seven times Oracle). Microsoft spent more on CAPEX in just 2023 than Oracle has in its entire nearly 50 year history.
Amazon and Microsoft are gradually driving more — from about 4% of revenue in 2001-2006 and now ramped up to 14-16% of revenue. So to compete in this market at scale you would need to pump $150 billion into capital? Incredible.