Google is taking a differentiated approach to providing cloud services to the enterprise. Mindful that its primary competitors in the enterprise cloud space have already built substantial installed bases, Google will leverage made-by-Google software to add value beyond re-hosting and lift-and-shift workloads. Its Google Cloud Platform NEXT 2016 (GCP NEXT) conference in San Francisco (March 23 – March 24, 2016) showcased these next-gen workloads, as early adopter customers described their use of Google-hosted applications.
Deep investments have already been made – with $9.9 Billion invested to build out the GCP business – and customers will be able to deploy workloads across more than a dozen datacenters worldwide. Google announced the opening of two more GCP regions: one in Oregon, and the other in Tokyo – with 10 more regions planned in 2017. In addition, the company provided a 360-degree view of the current Oregon data center in a new video. Price/performance for the services is set to be competitive for compute and storage, as Google is mindful that AWS and Azure have substantial cloud-services customers already. But the key to the enterprise, Google executives said, will be providing net-new capabilities in deep analytics, machine learning, sorting through image-and voice-based data and real-time “snapshots” of business data. Google is bringing these capabilities to market: some are generally available now, while others are in alpha-stage and beta-stage programs.
Key takeaways from the two-day GCP NEXT conference, held March 23-March 24 in San Francisco:
- Google is investing to gain mindshare and market share in the enterprise cloud service provider market. It is well aware that two of the largest cloud service providers – Amazon Web Services (AWS) and Microsoft Azure – are well-established in the enterprise space, with others, including IBM and Oracle, serving hybrid cloud customers. These large CSPs will compete for larger shares of a rapidly growing worldwide demand for hosted services and hybrid-computing applications linking enterprise data centers and cloud services. This competition is being fueled by enterprise moves to reduce Capital Expenditures (capex) for in-house datacenters while containing operational costs. As a consequence, more enterprise workloads are migrating to the CSPs. Google is far more interested in selling Google-style services than in re-hosting existing applications – although it could do that, as well. Takeaway: Google needs to spell out how its new applications will link to customers’ databases and business applications.
- Google is leveraging its internal IT infrastructure – dozens of data centers, and tens of thousands of servers worldwide — to provide the capacity and scalability aspects of hosting enterprise computing and web-scale applications for analytics and machine learning. Example workloads: genomics, analytics for streaming data, media & entertainment. At GCP NEXT 2016, Google outlined its strategy and initial enterprise services, but this is only the beginning of what Google plans to be a much bigger enterprise business over the next several years. Takeaway: This is one more way Google (Alphabet) is diversifying beyond its original search business, which was fueled by advertising sales; the new GCP business will generate usage-based subscription revenue. Google plans to build on its earlier Google Apps for Work SaaS offerings, which, Google said, already have 2 million customers.
- Google is leveraging capabilities developed for its search business — for image-processing, language translation and voice-based information – that will be marketed in new ways to enterprise customers. These capabilities will integrate new functionality – grafting it on top of other application and database workloads already running in the enterprise. Some of these GCP services are available already – but more are moving through the alpha and beta phases of final development, with customer feedback during these phases. Lighthouse customer deployments, like those at Coca-Cola, Disney, Home Depot, Snapchat and Spotify, spoke at GCP NEXT to show the model for these application development and analytics tools – and to shed light on their GCP usage scenarios. Takeaway: Google believes it will attract new customers through this lighthouse-program approach, in which customers provide insights and references based on their own experience with GCP and Google’s app-dev and management software tools.
Google is building out an ecosystem to expand its presence in the enterprise space. That is a wise and astute move, which will surround Google technology with well-established enterprise business partners. It is absolutely essential for this new market segment to blossom into a sizeable opportunity for Google, and its parent company, Alphabet.
More than 20 providers, including software companies, hardware companies and system integrators, had booths and demos in the conference’s exhibits space. The demos served to illustrate the next-gen flavor of the enterprise workloads under discussion. For example, Chef and Puppet showed sample workloads; Avere demonstrated cloud bursting to GCP resources; Intel and Brocade showed compute and networking support for GCP services; and PricewaterhouseCoopers (PwC) described its role in customer engagements spanning the enterprise and cloud services. Google and its partners are helping and advising these lighthouse customers, which are early adopters of GCP NEXT technologies.
GCP NEXT made it clear that Google is focused on gaining traction in the enterprise world. Clearly, Google has the economic resources and the technical capacity to deliver on its GCP strategy. The toughest challenge it faces is ensuring that its communications are heard clearly by business leaders in the enterprise: The business leaders are the ones funding the move to cloud services, but they are not as technically oriented as their own IT organizations. Takeaway: Google’s natural inclination towards the technical, which makes it an attractive partner for technical transformation, means it must turn up the volume on the business value of GCP to reach its key business audience.