Workforce issues 'genuine constriction' on Australia's AWS market

Amazon Web Services is expected to maintain its leadership position in Australia, ahead of Microsoft Azure and Google Cloud Platform, but the cloud giant and hyperscaler's service providers are facing labour headaches that represent a major challenge.

American technology research and advisory firm Information Services Group (ISG) says in its January 2023 Provider Lens report that Australia's private and public sectors have been hard hit by structural changes to the local workforce, and shifts in migration.

This is due to impacts from the COVID-19 pandemic, which resulted in a disruptive move to remote work causing human resource approach concerns, as well as security and business process issues, ISG noted.

On top of the above, the "Great Resignation" poses a threat to the market and AWS clients will need to manage that internally.

"It is also critical that they [AWS clients] understand how their service provider is able to manage the issue, and operate in a very tight labour market," ISG said.

With the top three hyperscalers absorbing a large part of the talent pool, the technology skills market has been disrupted considerably for the business and government segments.

Educational efforts are to slow to respond, leading to severe talent shortages which automation cannot fully solve, ISG noted.

In terms of top Australian providers, ISG rated 37 of these for positioning in AWS managed services, SAP workloads, data analytics and machine learning, IoT, migration and consulting.

Accenture, Deloitte, and Tata Consulting Services (TCS) were named as Leaders in all AWS service provision areas.

ISG defines Leaders as having comprehensive product and service offerings, strong market presence and an established competitive position.

Leaders have product portfolios and competitive strategies positioned to win business, and represent innovative strength.

Source: ISG. Used with permission.

Providers eligible to be included in the ISG report were also classified as Product Challengers that have portfolios that reflect excellent service and technology stacks; Market Challengers that have a strong presence and which offer a signficant edge over other providers based on competitive strength.

ISG's quadrant also classifies Contenders, which are promising provider or vendors that show evidence of investment in products and services, with the aim to becoming Product or Market Challengers within 12 to 18 months.