Google intended to take Amazon instead

Source: Internet
Author: User
Keywords Cloud Computing Amazon

It seems the industry analysts, Google is positioning itself as the backbone of the cloud business instead of Amazon. Although there is still a big gap with it, but Google still have the opportunity to catch up and one day to seize its cloud overlord throne.

"Amazon basically accounts for 80% to 85% of the current platform-as-a-service market share," said Jagdish Rebello, head of research at IHS iSuppli. "The market is currently in its infancy and the main driver of this market step by step Amazon, of course, had an early lead, but despite its strength, Google and some other competitors were able to narrow the gap and eventually lead the pack. "

Amazon's cloud computing platform, Amazon Web Services (AWS), was initially launched in 2006 and has enjoyed rapid growth since its inception and remains on the cloud business market, which is almost exclusively established by it The unshakable advantage.

In addition to having up to 85% of the current market share, AWS has an active computing resource equivalent to five times the total of the other fourteen competitors, Gartner said in a 2013 survey.

AWS's business development has also maintained a high speed forward.

In a report last week, Amazon said that as of the first quarter of 2014 on March 31 this year, the company's "other" categories, including AWS, increased sales by 60% compared with the same period last year. That is to say, during the quarter this part of the revenue amount has reached about 1.2 billion US dollars, much higher than the same period in 2013 of 750 million US dollars.

As a company that started out as an online bookseller initially, Amazon also owns a rich ecosystem of competitors such as Google that simply could not be realized.

"One of the reasons why Amazon is in the superior position is its superior ecosystem," said Lauren Nelson, an analyst at Forrester Research Inc. "The company has one of the largest ecosystems of its kind right now, and you can see the long list of products Amazon has And are ready to help customers deploy them in a very fast, highly automated and scalable way, with thousands of businesses doing their business around AWS today, some of them working on security for AWS, some on device issues and the resulting ecosystem Already have a considerable size. "

However, in the long run, can Amazon continue its position in this market, especially in the face of increasing competitive pressure? Although Google is widely regarded as the most threatening challenger now, there are many other factors The latecomer deserves to be carefully prepared by Amazon. After years of monopoly over the public cloud market, Amazon now has to watch with sights on every move by technology giants such as Microsoft, IBM, Hewlett-Packard and Verizon.

There are even rumors that Facebook has also decided to join the fray and establish its own public cloud service.

In the face of a series of challenges ahead, Amazon's continuous development and consolidation of the advantages I am afraid will not be as smooth as in the past.

At the same time, Google has an excellent opportunity to break Amazon's power position. According to analysts, Google, an enterprise that rules the online search service market, has used Android to create huge waves in the mobile space and dwarf other free-to-use email products through Gmail - Amazon is now its next hit. Neither Google nor Amazon has commented on the competition in cloud services between the two parties, but we have compiled five reasons why Google has a good chance of finally overwhelming Amazon and becoming a new leader in cloud computing.

1. The market is still young and prone to change

It's been eight years since AWS was founded, and there is a steady stream of vendors involved in the cloud, but most business users, especially small and medium businesses, still prefer to keep their data on remote servers connected over the Internet. Despite the rapid development, cloud computing business coverage is still at a low level.

A report released by Forrester last week showed that the public cloud market is under the so-called "high growth" trend. Forrester said the market is projected to reach a total of $ 191 billion by 2020, a figure 20% above Forrester's previous forecast in April 2011.

"Although the current cloud business is modest, it is in an explosive development," said independent industry analyst Jeff Kagan. "We are still in the first turn of the game ... everyone should still remember the advantages and the business scale of the original BlackBerry, but after the launch of the iPhone, all this has undergone a major turning point. Yes, this is all we have personal experience The reality. "

Kagan pointed out that the cloud computing industry will continue to evolve and embrace more changes in the next five to ten years, and the participating vendors will inevitably expand and undergo many changes during this phase.

"Often, the initial dominant vendors often fail to keep up the momentum for the next five to 10 years," he concludes.

2. Google has both brand strength, but also hold a solid financial strength

Amazon's brand awareness is quite strong, but judging from the perspective of the company's first name, most users are still impressed with books and even sports retailers Amazon. com level. In contrast, Google's impression of corporate users is undoubtedly more competitive and convincing.

"When people mention Amazon, the first thing people think of is their Kindle product and retail network," Rebello said. "But Google Docs and Gmail are already deep into the business world of many enterprise users. People are equally familiar with the Android operating system, and Google views them as a service provider when viewed from an enterprise IT perspective. The impression that the Google program into the business environment will be a logical choice.

In addition to brand appeal, Google also has a competitive advantage in terms of financial resources.

Amazon certainly has the money it needs to move forward with technological change, but Ederle Group analyst Rob Enderle said the company's economic strength is still not comparable to that of Google.

"Amazon has put a considerable part of its own revenue into the development and promotion of cloud services," he added. "Google is just on the road, and if Google believes it is truly of strategic importance to grow cloud businesses, Amazon will be amazed at their vast financial resources, which Google can afford to spend more than Amazon on a weekly fixed-fee basis."

Several other analysts also pointed out that most business users who are open to the cloud are using multiple services simultaneously. This is a completely new area where these companies want to compare different services and determine which one works better and the development is more reliable.

In other words, there will be a large number of new users in the ignorant of the first to choose their own familiar vendors, that is, Google. If Google is able to invest significant financial resources in cloud research and development, its ultimate overwhelming other competitors to seize the user base is likely to be only a matter of time.

3. Google needs to start from the price counterattack

Backed by ample budgets, Google is pushing down the cost of using public cloud services and forcing Amazon to join the fierce price war.

Google executives have said that the price of cloud computing solutions should also follow Moore's Law - that is, double-digit annual rate of decline. This is a positive sign, and Google seems to be working hard to move forward with this strategic vision.

For example, Google announced a reduction in service pricing in March this year. The current Google Compute Engine average price is nearly 32% lower than before, and Google Storage average use cost is significantly reduced by 68%, not to mention the price drop of up to 85% Google BigQuery on-demand analysis services.

Just the day after Google announced a cut in service prices, Amazon Web Services followed suit with the announcement of its 42nd price cut since its inception. For example, Amazon's Simple Storage Service has seen a 51% reduction in average price.

"After thinking, it's not hard to find the key impetus driving business users into cloud computing, and the emergence of cloud services has given SMBs an unprecedented low-cost era of IT upfront spending," Rebello said. "Google is trying to further rewrite the price equation, and if it can push prices down even further while overcoming the key obstacle to security, the future of cloud services will be unobstructed."

At the same time, he added, Google's positive position in terms of price squeeze has been able to attract more corporate customers who have recently reached cloud services and also have the opportunity to win more supporters from the existing user base of AWS.

4. Google may make a large-scale capital investment for this purpose

Although no more specific details were provided, Google executives made it clear at an earnings conference this month that the company is actively planning investment projects designed to ensure that customers are provided with all relevant resources that are sufficient to meet their needs.

"Google is embarking on the necessary capital investment, eliminating some corporate IT managers' skepticism about Google Cloud Services," Rebello explained. "If you keep your data in a cloud environment, enterprise IT will naturally question the security and when it comes to the vendors' capabilities, and Google hopes to ensure that users really get the resources they need by expanding their infrastructure." He It also added that it would also make Google a more competitive cloud service option for IT administrators and other decision makers.

5. Google's future strategy is closely related to the cloud

Google is positioning cloud to be at the heart of its future growth strategy and hopes to help the company keep its role as first-class internet vendor in the coming years.

Earlier this year, Google acquired Nest Technologies, an enterprise that specializes in intelligent home thermostat solutions that users can program and manipulate from their own mobile devices. Google to 3.2 billion in cash price of the company acquired the move, the move also let Google directly airborne network access to the home market.

Rebello pointed out that Nest is also a company that is inseparable from cloud computing.

Although the intelligent temperature control solution is installed in the user's home environment, its intelligent service still needs to be implemented based on the cloud. As Nest's first step into smart home solutions, they come up with smart appliances, smart locks and window locks and other mechanisms, while the cloud computing is to save all the new information from the Internet of Things terminal.

"If you think the future of lighting, doors, windows and other devices will all have access to digital gateways, then the climate control solution is of course one of the most insidious parts of the equation, but as a starting point for exploration, the driving force behind consumer behavior and the adaptation process It still plays an extremely important role, "Rebello said. "And all this will be attributed to the cloud strategy.If Google hopes to accomplish something in the smart home market, you must build a cloud system as its backing."

Google's focus on cloud strategy is unlikely to falter, and such a strong push must make it a major challenger for the Amazon cloud program.

Many IT practitioners think that cloud computing represents the future direction of development. They have always wanted to figure out how to achieve this goal, how long it will take to achieve that goal, and with what kind of service they will achieve that goal. In the process of exploration, Google's door of opportunity will also be opened.

"I think it is not likely that companies in top positions will be able to move forward fast in emerging markets where growth is changing so rapidly," Kagan said. "The ebb and flow of ups and downs is sure to happen from time to time, and I think Google and Amazon will be battling endlessly in this protracted competition, which is my future judgment of the cloud computing market."

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