Google: 'Dead Serious' About Enterprise Cloud

Mitch Wagner
3/24/2016
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SAN FRANCISCO -- Google on Wednesday launched cloud tools it claims will be critical to every business that has a major initial public offering in the future.

Rapid evaluation, cloud, machine learning and crowdsourced data "will be the basis and fundamental to every huge IPO win in five years," Google Executive Chairman Eric Schmidt said at a keynote for GCP NEXT 2016, the Google Cloud Platform Global User Conference Wednesday.

These new technologies, says Google, will create huge new platforms, companies, IPOs and wealth in the same way that the transition to apps created modern corporations such as Uber and Snapchat.

Google is positioning itself as toolmaker to this new generation of big business, and to that end introduced new services to enhance its Google Cloud Platform.

Google is opening access to its Cloud Machine Learning tools used in Google Now, Google Photos and voice recognition, to allow developers to incorporate machine learning capabilities such as voice and image recognition in applications using REST APIs, built using Google's open source TensorFlow machine learning library.

The Cloud Speech API available from Google does speech-to-test conversion in more than 80 languages. By opening those APIs for public consumption, Google is challenging Nuance, which dominates voice recognition.

Google is also enhancing its big data toolkit with long-term storage, and other capabilities.

It's all part of Google's drive to dominate in an industry segment where it has had limited success: the enterprise. Google has a long history of enterprise products -- at the outset of the conference here today, CEO Sundar Pichai namechecked the Google Search Appliance, the company's first enterprise product, introduced in 2002. It's had some success with Google Apps.

But even though Google recently achieved the largest market capitalization of any company in the world -- $508 billion as of Wednesday afternoon -- it has to prove itself to enterprise and cloud customers. Amazon.com Inc. (Nasdaq: AMZN) is by far the market leader in public cloud, with 31% market share; Microsoft Corp. (Nasdaq: MSFT) is a distant second at 9%; IBM Corp. (NYSE: IBM) is third, at 7%, and Google is a distant fourth at 4%, according to 4Q 2015 research from Synergy Research Group.

Diane Greene, the Google SVP heading up the cloud business, is a powerful weapon for Google in its latest attempt to win the enterprise cloud market. Greene, who previously co-founded VMware Inc. (NYSE: VMW), was named head of the Google cloud business in November.

"We are dead serious about this market," Greene said during a press Q&A Wednesday morning.

Urs Hölzle, Google senior VP technical infrastructure, agreed. "I've been quoted publicly as saying this could be larger than ads, and I very seriously believe it," he said. The addressable enterprise cloud market is much larger than the ads market. (See Google Makes VMware Co-Founder Cloud Boss.)

At a sales meeting this month, Greene told Google sales that they weren't taking corporate customers seriously enough and needed to sell harder, be hungrier and less complacent, according to a BloombergBusiness report. The company plans to hire additional cloud staff and expand into less technical markets.

The cloud news for Google isn't all bad. Google is growing gangbusters -- 108% year-over-year growth, compared with 124% for Microsoft, and 63% for Amazon, according to Synergy Research.

And it's not like Google is bereft of enterprise customers -- at the conference today, Walt Disney Consumer Products and Interactive Media, along with, Coca-Cola took the stage to issue brief endorsements of working with Google Cloud. Netflix -- a longtime AWS headline customer -- did a presentation on developing Spinnaker, a tool for deploying software objects in the cloud that it uses with AWS, in conjunction with Google.

As a challenger, how does Google differentiate from the market leaders? By being unique -- in particular, supporting a combination of open source and its own proprietary technology. Google also offers 50% better price/performance than its competitors, according to Greene.

Scale is another differentiator. Google offers service around the world, and can help enterprise multinationals extend internationally, Hölzle said. Google offers load balancing that makes workloads location-independent; developers don't have to be aware of where their applications are running.

Extending that global reach, Google said Tuesday it plans to add two new regions -- a US western region in Oregon, and East Asia region in Tokyo, with ten new regions coming online through 2017.

And Google is working hard on partnering with other companies to sell and support cloud services to the enterprise, Greene said.

A third differentiator is ease of management -- "NoOps" deployment, Google VP product management Brian Stevens said.

Like Greene, Stevens brings enterprise experience to Google. Prior to joining Google in 2014, Stevens served as EVP and CTO at Red Hat for 14 years, beginning in 2001.

Snapchat, one of Google Cloud's headline customers, went to 100 million users without hiring an operations team. "The VP of engineering says 'it's just me and one other guy.' It just works. It scales up," Greene said.

"We think it's important that developers are just focused on code. They're dealing with their customers and solving business problems," rather than configuring servers in data centers, Stevens said.


Find out more about cloud at our upcoming Big Communications Event in Austin, Texas, May 24-25. Register now!

As part of Google's cloud management tools, Google announced beta for Google Stackdriver on Wednesday, a service for monitoring, alerting, and visualizing cloud deployments. Recognizing that companies use multiple cloud services, Stackdriver supports both Google Cloud Platform and Amazon Web Services. Google acquired Stackdriver in 2014. (See Google Buys Cloud Monitoring Startup.)

Next, Google plans to integrate support for virtual machines for on-premises technologies.

Google is undecided whether to offer Microsoft Azure support to Stackdriver, Stevens said. Typical workloads for Google customers have been on Amazon and AWS.

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— Mitch Wagner, Follow me on TwitterVisit my LinkedIn profile, West Coast Bureau Chief, Light Reading.

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Joe Stanganelli
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Joe Stanganelli,
User Rank: Light Sabre
4/17/2016 | 8:50:20 PM
Re: Google... sigh
@Steve: I'm not a fan of Amazon, but here's why I root for companies like Amazon over companies like Google.

Google/Alphabet wants to make money, but it also wants to "change the world."

Well, changing the world rather means imposing your point of view on others (does it not?).  It means some form of totalitarianism.

Amazon just wants to make money.  You bet your patootie Jeff Bezos doesn't care about changing the world except insofar as it makes him money.

I like its search engine, but insofar as that changing the world stuff goes, I actively root for Google/Alphabet to fail.
mendyk
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mendyk,
User Rank: Light Sabre
4/1/2016 | 12:13:15 PM
Re: Google... sigh
One of the issues that's popping up fairly regularly with the early 21c giants is the tendency to approach new business opportunities with internal development, rather than do what giant companies can do best, which is to buy their way in. Google Fiber is one example. As others have pointed out over the years on the LR message boards, overbuilding wireline networks is a high risk/limited reward proposition. To take another example, Amazon has succeeded in destroying the brick-and-mortar bookselling business, and now it's apparently planning to open a chain of b-and-m bookstores. I agree that Google-phabet is not demonstrably more arrogant than its SV neighbors. But the comparison isn't flattering.
Mitch Wagner
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Mitch Wagner,
User Rank: Lightning
4/1/2016 | 11:28:24 AM
Re: Google... sigh
I was gearing up for a brisk defense of Google but then this happened.
Mitch Wagner
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Mitch Wagner,
User Rank: Lightning
3/31/2016 | 7:29:30 PM
Re: Google... sigh
Google's Urs Hözle says he sees the enterprise cloud as potentially being bigger revenue than the ad business. It seems like a natural fit for Google. And the search ad business is threatened as people do less searching. 

Google doesn't seem any more arrogant than any other consumer business in Silicon Valley. Today I saw a headlne on Techmeme about a company that does fitbit dogs. Fitbit for dogs! Millions of people in America are so desperate that Donald Trump looks like a good option, and meanwhile other people are making Fitbit for dogs. 

Found the link. The company was acquired for $100 million. 

Google is admirable in that it is a company that is looking to solve real problems, like finding information and not dying.
Steve Saunders
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Steve Saunders,
User Rank: Blogger
3/31/2016 | 2:47:26 PM
Google... sigh
Mitch,

As you know google is not my favorite company on the planet (or even my second, or third... actually, i don't think it gets onto the favorities list at all...) 

Two reasons: one to do with Google employees (off the record and in person a lot of the people that work there are a bunch of gigantic arrogant arseholes, when they aren't evicting Mission district renters from their tenements ... a.k.a. "cultural dissonance") and the other nothing to do with them, but totally to do with media (the media loves to crawl up their arse, for no reason other than "ooh, google").

So what i like about your coverage is how pragmatic it is... they are a big internet search ccompany (one with a serial history of failed new product launches) and effectively limitless real money and intellectual capital.

Neither of those attributes matter when it comes to winning "in the cloud" if they can't get their head around adding the cultural strengths which make real companies successful ... things like humility, a sense of history, and mundane things like good customer service, and sales people "with a brain" etc. etc.

Based on their history to date there is zero evidence they can do that, and your photo essay doesn't provide any new inputs (stilt walkers, tetris... 1993 much?)  

The future (five years out, ten years out) is a cloud, not a search engine, and this is where the wheels fall off their hubris driven internet machine, is my bet (Marrissa 2.0 if you will).  

Steve 

 

 

 
mendyk
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mendyk,
User Rank: Light Sabre
3/31/2016 | 11:59:35 AM
Re: What's in that cloud?
Well, plain vanilla isn't really just plain vanilla. There are quality differences that lovers of plain vanilla can discern. Which in a weird way adds to the point about standardization vs. proprietary innovation.
Joe Stanganelli
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Joe Stanganelli,
User Rank: Light Sabre
3/31/2016 | 11:25:02 AM
Re: What's in that cloud?
Well, there will always be people who prefer the standard, who prefer the everyday, who prefer the no-frills what-everyone-else-has.

I know a number of people whose favorite ice cream flavor is vanilla.  That's weird to me, but not as weird as it used to be -- once I started meeting more people for whom that's the case.
Joe Stanganelli
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Joe Stanganelli,
User Rank: Light Sabre
3/31/2016 | 11:23:23 AM
Re: limited
@Mitch: Certainly, but it's at least a market leader (if not the market leader).

Additionally, research shows that in terms of Shadow IT, Google Drive actually enjoys more use than Microsoft One-Drive!  So, there's that.  ;)
mendyk
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mendyk,
User Rank: Light Sabre
3/31/2016 | 11:13:11 AM
Re: What's in that cloud?
Understood, mostly. Again, though, innovation is what will drive progress, and the relationship between innovation and standardization is more about convenience. Plain vanilla anything is just ... boring. And not particularly valuable.
Mitch Wagner
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Mitch Wagner,
User Rank: Lightning
3/31/2016 | 11:00:36 AM
Re: What's in that cloud?
I don't hear about open source replacing everything – at least, I don't hear about it from folks like OPNFV and OpenDaylight. Most espouse some variant of AT&T's John Donovan's line, that most code should be open with proprietary code used for secret sauce, sparingly, like Tabasco. 

(To which I like to respond that I buy Tapatio sauce by the quart, but I understand Donovan is talking about NORMAL PEOPLE here.)

As for what will happen in a few years: Who knows? Maybe everything will go to open source. Recall that this notion of code being property that is separate from the hardware only goes back 40 years or so – for the first couple of decades of computers, software and hardware were two parts of a single whole. Fella named Bill Gates changed that. Go forward in time a few years and who knows where intellectual property laws and customs will go?
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