Google joins competition in the cloud

google-1

Google already runs much of the digital lives of consumers through email, internet searches and YouTube videos. Now it wants the corporations, too.

 

The search giant has for years been evasive about its plans for a so-called public cloud of computers and data storage that is rented to individuals and businesses. On Tuesday in the US, however, Google announced pricing, features and performance guarantees aimed at companies ranging from start-ups to multinationals.

 

It is the latest salvo in an escalating battle among some of the most influential companies in technology to control corporate and government computing through public clouds. That battle, which is expected to last years and cost the competitors billions of dollars annually in material and talent, already includes Microsoft, IBM and Amazon.

 

As businesses move from owning their own computers to renting data-crunching power and software over the internet, this resource-rich foursome is making big promises about computing clouds. Supercomputing-based research, for example, won’t be limited to organisations that can afford supercomputers. And tech companies with a hot idea will be able to get big fast because they won’t have to build their own computer networks.

 

Take Snapchat, the photo-swapping service that recently turned down a multibillion-dollar takeover offer from Facebook. It processes 4000 pictures a second on Google’s servers but is just two years old and has fewer than 30 employees. The company started out working with a Google service that helps young companies create applications and was chosen by Google to be an early customer of its cloud.

 

Working with Google has allowed Snapchat to avoid spending a lot to support its users.

 

“I’ve never owned a computer server,” said Bobby Murphy, a co-founder and the chief technical officer of Snapchat.

 

That is a big shift from the days when, for young companies, knowing how to build a complex data centre was just as important as creating a popular service.

 

“These things are incredibly fast – setting up new servers in a minute, when it used to take several weeks to order, install and test,” said Chris Gaun, an analyst with Gartner. “Finance, product research, crunching supercomputing data like genomic information can all happen faster.”

 

Amazon’s cloud, called Amazon Web Services, was arguably the pioneer of the public cloud and for now is the largest player. Amazon says its cloud has “hundreds of thousands” of customers. Although most of these are individuals and small businesses, it also counts big names like Netflix, which stopped building its own data centres in 2008 and was completely on Amazon’s cloud by 2012. All of Amazon’s services are run inside that cloud, too.

 

A more traditional consumer goods company, 3M, uses Microsoft’s public cloud, called Azure, to process images for 20,000 individuals and companies in 50 countries to analyse various product designs. Microsoft says Azure handles 100 petabytes of data a day, roughly 700 years of HD movies.

 

“People started out building things on Amazon’s service, but now there are a few big players,” said Murphy. “Hopefully the time between an idea and its implementation can get even quicker.”

 

Google is cutting prices for most of its services like online data storage and computer processing by 10 per cent and its high-end data storage prices by 60 per cent, while offering access to larger and more complex computing systems. Google is also guaranteeing that critical projects will remain working 99.95 per cent of the time, far better performance than in most corporate data centres.

 

“People make a mistake thinking this is just a version of the computers on their desks, at a lower cost,” said Greg DeMichillie, director of Google’s public cloud platform. “This is lots of distributed computing intelligence, not just in computers and phones, but in cars, in thermometers, everywhere. The demand will only increase.”

 

DeMichillie, who came to Google from Amazon Web Services, allowed that Google was far slower than Amazon to get into the business.

 

“I give them a lot of credit,” he said of Amazon, adding that in the long run he believes Google’s deep experience in data centres will help the company provide a stronger and more reliable service.

 

Google has a mixed record in similar efforts. The business version of Drive, its word processing, spreadsheet and storage service, was introduced under another name in 2007. It now has revenue of more than $US1 billion a year, but current and former executives have complained that it is a low priority inside the company because Google makes so much more money from consumer advertising.

 

But Google is one of the few companies that has the heft to compete with the others.

 

IBM, which in July paid $US2 billion to buy another cloud provider, will add 12 new facilities in 2014, eventually with 240,000 more servers around the globe, according to a senior IBM executive. It already has 25 such facilities. Hundreds of cloud-based services will be introduced, including cheap new communications systems and software for big, complex companies.

 

David Campbell, the chief technical officer of Microsoft’s cloud group, said he was often surprised by the growth of the clouds.

 

“It’s vastly different from anything anyone has done, a completely different beast,” he said.

 

And this shift is just beginning, maybe three years into a 10-year process that is democratising heavy-duty processing power, Campbell said.

 

imailsend wide banner ad

Sign up now for our FREE Newsletter!