Amazon has been the leader in the cloud space for years. Cloud service providers like Amazon, Google, and Microsoft let other companies save money on hardware by charging them to use their servers, storage, and database resources.
In 2013, Amazon Web Services (AWS) had more revenue than Microsoft Azure and Google Cloud Services combined, according to analysts from equity research firm Evercore.
Google is hosting an event today to talk about its cloud services. At Google’s Cloud Platform Live conference it will announce new offerings to make it easier for customers to set up cloud services and — it hopes — help make it a more attractive option than Amazon, Alistair Barr at The Wall Street Journal reports.
Amazon launched AWS in 2006. Google has always focused on building incredibly powerful data centres, but it didn’t start renting out computing power until two years later, in 2008. When Google did finally unveil its services, the company required customers to write software similar to the way that it does, and the lack of flexibility pushed people towards working with Amazon.
A former Amazon executive who now runs a cloud-management startup called Nimbula told Barr that at a meeting with Google executives in 2009 about potentially teaming up to compete against Amazon, they seemed nonplussed.
“Their answer was ‘Why,'” he says. “They weren’t convinced that this was a real business.”
Amazon Web Services accounted for 37% of the $US9 billion infrastructure as a service (IaaS) market in 2013, according to Evercore, and Gartner reports that the market will grow 35% a year to $US42 billion by 2018.
Despite Amazon’s huge lead, Google is determined to close the gap.
In September, Google announced a program called Cloud Platform for Startups where it gave fledgling companies $US100,000 in cloud computing credits for free, thereby enticing them into its ecosystem early. As the startups grow, they will likely stay with Google, which translates to increased business. Last year, Google launched Compute Engine, a flexible service similar to what Amazon offers.
Google will likely make similar new announcements at its Google Cloud Platform Live conference today.
This isn’t the only place where Amazon and Google are battling. They are both competing to win the same-day delivery battle. And they are competing to win over users who are searching for things to buy.
For years, Google was the starting point for anyone looking to buy something on the internet. As Amazon has grown, it’s become a starting point for lucrative commercial searches. This is a real threat to Google’s business.
For all the focus on Apple versus Google, and Google versus Microsoft, the real battle for Google is against Amazon. That’s why we’re going to see Google attack another big, core Amazon business line.
Disclosure: Jeff Bezos is an investor in Business Insider through his personal investment company Bezos Expeditions.
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