Cloud computing: a gamble of Google
Late last March in San Francisco, President Eric Schmidt of Alphabet Inc., Google's parent company, was standing in front of thousands of developers in cloud computing field and "preaching" for 20 minutes about the strengths of internal software department at Google, presenting why the company’s products have to be more appreciated. It proves that Google’s cloud computing is still being "estranged" by businesses and customers.
Although Google has created a lot of data analysis tools and basic software for cloud computing right since the 1990s (only to serve the needs of internal use), Amazon was the first company commercializing this service 10 years ago with the advent of Amazon Web services, a service that lets other companies hire "data storage on the cloud" instead of spending huge amounts on technology infrastructure investment.
Two years after the launch of Amazon Web Services, Google App Engine was released, but it forced customers to let Google directly manage using computer resources instead of letting customers hire a part of “data storage" as Amazon. Schmidt admitted this was not a wise start.
Last year, Google earned $ 500 million from the cloud on total sales of $ 75 billion, according to estimates by Morgan Stanley, not much compared to $ 1.1 billion of Microsoft and approximately $ 8 billion of Amazon. According to Gartner, the enterprise cloud worth $ 20 billion could grow to 35% next year.
To turn things around, Google has invited Diane Greene to be in charge of cloud computing. Greene is a myth of Silicon Valley. She co-founded VMware Inc. in 1998 to bring a technology called virtualization in the data center of most large companies. Virtualization allows one computer do the job of multiple computers, an important factor helping Amazon Web services become feasible. The previous managers at VMware all agree Greene has really excellent technological acumen.
Can the "trump card" Diane Greene help Google gain a larger slice of cloud market in this harsh period? It can be seen, after the launch of App Engine failed, in 2012, the company has launched Google Compute Engine, more like Amazon's service. However, Google was still slow in bringing this product to potential customers. Greene says it is changing.
She is looking for more sales staff. The cloud sale team West Coast has nearly doubled to 50 people. She also requires employees to work more closely together and communicate with customers more frequently, and creates a team to meet customers directly. The aim is to ensure that Google develop right products to fulfil the needs of customers. This is normal for traditional companies like Salesforce.com and Oracle Corp. but is a new game is for Google, a company specializing in "self-serving" Web products.
Greene is trying to put more features that businesses expect to Google's cloud platform, especially supporting tools such as a tool to control law compliance and advanced private information protection. Greene also revealed that her next upgrades would focus on data analysis and machine learning.
Google is spending more money on cloud marketing to compete with rival focusing on enterprise subjects such as Microsoft. Greene also recruits more marketing staff, including Director of Marketing.
The increased investment in both sales and marketing is good news for Google's partners, because they will be able to sell more products if customers become familiar with their cloud technology. This year, Greene attended an important meeting with SADA Systems, a major partner of Google. This was the first time in 9 years, a Google’s senior executive attended a meeting with customer, according to CEO Tony Safoian of SADA. Google also enhanced support for enterprises to build and develop products working well with Google's cloud platform, for example Avere Systems Inc.
Not only that, Greene talked to “rivals” such as SAP, Microsoft and Oracle, to provide more products of these companies to Google’s cloud. This is a must for large companies, because they need “packed” software from providers to operate the business. There is currently no product of Oracle or SAP's on Google’s cloud platform yet. Microsoft and Oracle declined to comment, while SAP admitted they had initial talks with Google.
The biggest challenge and also biggest surprise of Google is its technology is too advanced. Because of main internal systems of Google work too deeply, so sharply, too differently, selling products becomes difficult. Can Greene's experience help her solve this problem?
Google's first attempt is App Engine, which allows enterprises to simply upload the software code, and Google will handle all the rest. It is a vision of distant future, but for now customers do not want to hire a “do-it-all” service like that. Instead, they prefer more flexible and less advanced from Amazon. In other words, Google's problem is how to put their products on the same "level" with customers.
According to Carl Brooks, an analyst at the 451 Group, Google will need to be patiently prove that their cloud products are just as good as Amazon or Microsoft’s.
By: Emma Lane