Hyperscaler

In short

A hyperscaler is one of the very largest cloud computing companies, such as Amazon Web Services, Microsoft Azure and Google Cloud. They own vast networks of data centres and rent out computing power, including AI chips, on demand.

Also called: Hyperscale cloud provider, Hyperscale cloud, Big cloud providers
Topic: Chips, compute and data centres
Level: Beginner

"Hyperscaler" is industry shorthand, not a legal term. It is used loosely for the few cloud providers that operate at the very largest scale. In one survey submitted to the UK's Competition and Markets Authority (CMA), AWS, Microsoft Azure, Google Cloud, IBM and Alibaba were given as examples of hyperscale public clouds¹.

What they sell is cloud services: shared computing power, storage and networking that customers rent rather than own². UK customers spent £10.5 billion on cloud services in 2024².

The market is concentrated. The CMA found that Microsoft and AWS each held 30 to 40% of the UK and EEA market for core cloud infrastructure in 2024, with Google third at 5 to 10%². It concluded in July 2025 that competition in cloud services was not working well².

Hyperscalers are also the main route to AI chips for most companies. The CMA found that Microsoft, AWS and Google are all strong providers of accelerated compute and AI cloud services, often through partnerships with AI model developers². Their spending is huge: Microsoft announced $80 billion for AI-enabled data centres in its 2025 financial year, and Alphabet planned $75 billion of capital spending in 2025¹.

Some newer firms that rent out GPUs, such as CoreWeave and Nscale, market themselves as "AI hyperscalers"¹. They are much smaller than the big three.

Example

A UK start-up building a chatbot can rent AI chips from AWS, Azure or Google Cloud instead of buying its own. The CMA found all three are strong providers of this "accelerated compute"².

Why it matters

A handful of hyperscalers control much of the world's computing power. Their prices, chip supply and deals with AI labs shape who can build AI and at what cost.

Questions people ask

Who are the hyperscalers?

Usually Amazon Web Services, Microsoft Azure and Google Cloud. In the UK, the CMA found Microsoft and AWS each held 30 to 40% of the cloud infrastructure market in 2024, with Google at 5 to 10%².

Is the CMA regulating hyperscalers?

The CMA found in July 2025 that cloud competition was not working well and recommended action on Microsoft and AWS². In March 2026 it opened a strategic market status investigation into Microsoft's business software, including cloud licensing, while Microsoft and AWS made non-binding moves on exit fees and interoperability³.

Is Nvidia a hyperscaler?

No. Nvidia makes the chips. Hyperscalers buy those chips and rent out the computing power in their own data centres².

Related terms

Sources

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