Google's Cloud Business Grows Stronger
Google's Cloud Business Grows Stronger by UCStrategies Staff
It has been estimated by the analyst firm TBR that Google was able to generate $97 million in revenue in the fourth quarter of last year, and $314 million for the whole of last year.
According to TBR, the Google Apps, Google App Engine, and Google Compute Engine, which are all a part of Google’s cloud business, made a significant mark on the company’s “other” category, which increased 102 percent year-over-year. Google Play and content sales are also part of the “other” category. It is estimated that the company’s Google cloud business will triple this year to just under $1 billion.
TBR suggests that Google will be able to monetize Google Apps for Business for SMBs (which has been discontinued), and states that it could account for $65 million, or 67 percent of the company’s fourth quarter business.
Microsoft’s Office 365 and IBM’s recent SmartCloud Docs do, however, pose a threat to Google Apps, particularly with regard to data security, functionality and customer relationships.
TBR reported: “Google will develop its customer and revenue base while emphasizing core technological strengths while competing on prices.”
The price war between Amazon Web Services and Google rages on and the latter has been making cuts in the price of its IaaS Google Compute Engine. Prices were cut twice in the fourth quarter to $0.12/GB/hour for 0 to 1 TB – with reductions thus adding up to 30 percent. The IaaS leader, AWS, cut prices for its EC2 storage product by 25 percent to $0.10/GB/hour.
TBR stated: “In an increasingly competitive IaaS market that also saw Microsoft (NSDQ:MSFT) cut Windows Azure Storage prices by 28% in December, Google is aiming to gain IaaS market traction by capitalizing on cross-sell opportunities via integrating Google Compute Engine into its end-to-end portfolio (SaaS, PaaS, IaaS) of easy-to-deploy software, cloud and social networking products.”
Platform-as-a-service is still invested in by Google, and the Google App Engine is an example of this. TBR estimates that this accounts for 33 percent of Google’s cloud revenues.
Overall, a quarterly profit of $2.89 billion was announced by Google, an increase from $2.71 billion in the same quarter the previous year. The company’s net revenue totalled $11.34 billion. (CY) Link