Global hyperscalers are rapidly reshaping the enterprise IT landscape as their capital expenditure surges.
The top four players—Amazon Web Services, Microsoft Azure, Google Cloud, and Oracle—are expected to invest around $300 billion in 2025, climbing to $500 billion by 2030, potentially absorbing most of the incremental enterprise technology spending.
Fuelled by massive investments in artificial intelligence infrastructure, hyper-scalers are targeting a larger share of enterprise budgets traditionally allocated to IT services firms.
According to HSBC Global Investment Research, AI adoption could cause an 8–10% deflation in IT services by FY-2027, with annual impacts of 3–4% expected during 2025–27 as existing deals renew.
While IT companies have offset some of this pressure through higher project volumes, analysts predict a tug-of-war between this deflationary impact and favourable macro-economic tail-winds by 2026.
In 2024, the top three hyper-scalers collectively earned $260 billion in cloud revenues, adding nearly $46 billion year-on-year, compared with only $14 billion growth across the entire IT services sector, which reached $283 billion.
As enterprises consolidate their tech spending around AI, automation, and cloud ecosystems, hyper-scalers’ dominance—and the rise of agentic AI—could redefine the future of IT outsourcing.
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