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March 17, 2016
By Business Cloud News
Apple has moved some of its iCloud services onto Google Cloud, reducing its reliance on AWS, according to a CRN report.
Though it will still remain an AWS customer, the story states Google claims Apple will now be spending between $400 million and $600 million on its cloud platform. Last month, financial services firm Morgan Stanley estimated Apple spends $1 billion annually on AWS public cloud, though this is likely to be reduced over the coming years as Apple invests more on its own datacentres.
The company currently operates four datacentres worldwide and apparently has plans to open three more. It has been widely reported that Apple has set aside $3.9 billion to open datacentres in Arizona, Ireland and Denmark, with plans to open the first later this year.
Google has been struggling to keep pace with AWS and Microsoft’s Azure, but recent deals indicate an improved performance. A recent survey from Rightscale demonstrated AWS’ dominance in the market, accounting for 57% of public cloud market share, while Azure currently commands seconds place and Google only accounts for 6% of the market.
To bolster its cloud business Google hired VMware co-founder Diane Greene to lead the business unit, which includes Google for Work, Cloud Platform, and Google Apps. The appointment, together with the acquisition of bebop, which was founded by Greene, highlights the company’s ambitions in the cloud world, where it claims it has larger data centre capacity than any other public cloud provider.
Industry insiders have told BCN that acquisitions such as this are one of the main reasons the public cloud market segment is becoming more competitive. Despite AWS’ market dominance, which some insiders attribute to it being first to market, offerings like Azure and Google are becoming more attractive propositions thanks in part to company and talent acquisitions.
Commenting on the deal Ovum’s Lead Cloud Analyst, Laurent Lachal said “Apple is right to seek to diversify its platform partners in order to pit them against one another to get the best deal, and to build some redundancy in case of problem in one of the platforms. A more balanced IaaS market, with a less dominant AWS, is in the interest of all parties as it will keep innovation (rather than merely cost cuts) going.
“It is good to see Google becoming more aggressive. However, it will take time for the company to catch up with AWS. This is fine for Google, which is clearly playing the long game when it comes to public cloud services,” said Lachal.
Last month, the Google team secured another significant win after confirming music streaming service Spotify as a customer. Spotify had toyed with the idea of managing its own datacentres but said in its blog“The storage, compute and network services available from cloud providers are as high quality, high performance and low cost as what the traditional approach provides.” The company also highlighted that the decision was made based on Google value adds in its data platform and tools.
While Google and Apple have yet to comment on the deal, an Amazon spokesperson has implied the deal may not have happened at all, sending BCN the following emailed statement. “It’s kind of a puzzler to us because vendors who understand doing business with enterprises respect NDAs with their customers and don’t imply competitive defection where it doesn’t exist.”
The rumoured Apple/Google deal marks a tough couple of weeks for AWS. Aside from Apple and Spotify, the company also lost the majority of Dropbox’s business. AWS is still occupies a strong position in the public cloud market but there are increasing signs its competitors are raising their game.
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