Can Google Cloud Platform Catch Up With AWS and Azure?

Back in December 2019, Google was forced to deny reports that top-level discussions had been held exploring the possibility of exiting the public cloud infrastructure market (IaaS), and in doing so, tacitly concede defeat to its two biggest cloud rivals, Amazon and Microsoft.

The denial was followed by a bold riposte - on the contrary, declared Google, our intention now is to dislodge Amazon Web Services (AWS) and Microsoft Azure from their perch at the top of the IaaS market and become the world’s number one or number two player by 2023.

The Google Cloud Platform (GCP) just about clings on in discussions about the ‘big three’ in public cloud infrastructure, and is still named as one of the industry’s three ‘leaders’ in Gartner’s magic quadrant. But the truth is it has some way to go to realise its ambition of catching its competitors.

The digitisation rush triggered by the COVID-19 pandemic made 2020 a bumper year for the global cloud market, growing by a staggering 33% in Q3 alone. Yet the rapid growth did nothing to shift the balance the power, with AWS enjoying a 32% market share to October 2020, Azure 19% and Google Cloud 7% - more or less identical to figures from the previous year when Google laid bare its intentions.

So why exactly are AWS and Azure so far ahead of GCP? And given the fact that Google hasn’t been able to flex its considerable might to take advantage of the COVID cloud rush to close the gap, what exactly does it have to do to fulfil its ambitions by 2023?

Up against history

There are historical reasons why Google has had to settle for third place in the cloud infrastructure market to date. It is no secret why Amazon controls such a big share. Sitting on masses of spare capacity at the hyperscale datacentres it built to run its global ecommerce empire from, Amazon pretty much invented the IaaS market when it struck on the idea of renting out this spare resource to other businesses.

Keeping up an impressive pace of new service releases ever since has helped AWS cling onto the advantage of its headstart. With more than 175 services offered, AWS simply lets companies do more than any other cloud platform available, and is a firm favourite with developers as a result.

Azure, meanwhile, might have launched a year after GCP, but Microsoft already had a headstart in terms of access to the enterprise market. Big companies that had long used and trusted Microsoft on-premise solutions were happy to adopt the company’s cloud offering as an upgrade. And just as Microsoft very successfully bundled its Windows operating system with software tools like the Office productivity suite, helping both become virtually default options in business computing, so the company has once again had success creating one-stop enterprise cloud packages comprising Azure, Office 365, Teams and more.

Innovation specialist

If AWS is the cloud infrastructure market first mover and Microsoft the slick enterprise player, Google is recognised as a great innovator in the infrastructure market. Now industry-standard technologies in data analytics, Machine Learning inference and, most famously, containerisation (i.e. Kubernetes) have all originated from Google DevOps teams.

Writing in Forbes, tech stock analyst Beth Kindig attributes this pioneering streak to the fact that Google, with its search engine, YouTube and other assets, is one of the world’s biggest cloud customers in its own right. Infrastructure innovations like automated container orchestration have been born of internal necessity, the technical demands of processing millions of searches or page hits every minute.

What Google has not been as slick at compared to, say, Amazon, is then packaging these assets for the wider market - perhaps, claims Kindig, because its primary focus is on other, bigger sources of revenue, namely search and YouTube again.

If Google is going to overhaul Microsoft and Amazon in the cloud infrastructure market, this has to change.

Shifts in the market

There are signs the market is heading in certain directions that could favour GCP. With multicloud deployments a growing trend as companies seek both to avoid vendor lock-in and build greater agility into their cloud strategies, each of the infrastructure ‘big three’ is seeing strong growth in containerisation services. With Kubernetes currently a narrow second only to Docker as the most widely used container technology, this should play into Google’s hands.

Another aspect to multicloud is offering a management layer to rationalise control of distributed app deployments. GCP currently offers this via Anthos, its Kubernetes-based API launched in 2019. Anthos has been widely tipped as a key strategic play to help Google increase its share of the enterprise market.

Aside from tech, there are also signs that Google has shifted its thinking on how it positions its cloud offerings, in many ways taking a leaf out of Microsoft’s book. So rather than relying on a hard infrastructure/technical focus, it is starting to integrate its GCP and G Suite SaaS sales channels, and building bespoke industry-specific ‘whole cloud’ packages.

It’s a big ask for Google to make up the ground to Microsoft Azure in two years, never mind AWS. But with cloud markets looking all set to evolve and grow rapidly in the wake of COVID, it won’t get a better opportunity. And from the perspective of cloud users, enterprises and developers, more competition right at the top can only be a good thing.