Cloud business pays out for Alphabet

Cloud business

Google’s parent company, Alphabet, has been doing well in the cloud business if its latest quarterly results are anything to go by. 

Alphabet’s cloud business – in which it includes digital content sold through its online Google Play store – reported an increase of 10 per cent.

Ruth Porat, Alphabet’s chief financial officer, says the revenue growth is a sign that Google’s investments in different businesses is beginning to pay off, according to eWeek.com.

“Google Cloud is generating substantial revenue growth, reflecting the ongoing momentum in the business as well as the enormous opportunity in this area,” said Porat.

Google CEO Sundar Pichai has been emphasising the company’s strengths in cloud services, which he believes are critical to the future of the company.

In a blog earlier this year, Pichai said that artificial intelligence will become much more integral to people’s lives, both at work and at home, and claimed that the very concept of the “device” will “fade away”.

“Most of these computing experiences are very likely to be built in the cloud,” he added.

While Google Cloud Platform has been making gains in the market, the current leader of the cloud market is Amazon, which is regarded to have originally articulated the idea of cloud computing.

A survey by Synergy Research suggests Amazon has a third of the cloud services market all to itself, while Google is grouped in “the next three”, with Microsoft and IBM, on a combined total of around 24 per cent.


Source: Synergy Research Group

 

Google seems to have reduced its investment in what it calls “Other Projects”, or “Moonshots”, and even discontinued or stopped updating what would otherwise seem like sensible technologies, such as its tablet computer range, the Nexus.

However, it continues to test its products and services in market which are new to the company which still makes the bulk of its money from its search engine.

And while it may not have announced a new Nexus, which is probably wise since nobody seems excited about such a thing, it did launch a new phone recently called Pixel.

The company also seems to be building a networking infrastructure to go with with its awesome data centre infrastructure. It’s no good having space-age data centres if the data stored in them can’t be delivered fast enough to the end users.

And as software is increasingly loaded with what is now called “artificial intelligence”, the likelihood is it will be too memory-hungry to store on individual users’ devices – even if they’re desktop computers – and would need to be stored at data centres.

But even today, users are increasingly likely to store their data – pictures, files, videos and pretty much everything else – on remote servers, or the cloud, rather than their own device.

Moreover, Apple signed a deal earlier this year to use Google’s servers for its iCloud services, a move which may put more pressure on Amazon’s market share.