According to industry sources, Google’s cloud data platform has secured a major new customer this week – tech rival Apple. The news is a significant boost for Google, as the company looks to close the gap on Amazon Web Service (AWS), the leading cloud data service provider in the market. Apple has apparently chosen Google’s data platform to help diversify away from a reliance on Amazon’s platform and Microsoft’s Azure, although the company will continue to make use of these services too.
Google has been looking to secure a number of larger businesses for its platform, and may have offered a significant deal to its tech rival. The company has long been a distant third in the market, behind Amazon and Microsoft. A recent RightScale survey found that only 6 percent of respondents used Google’s infrastructure, while 17 percent use Microsoft, and 57 percent opt for Amazon. Sources have suggested that Apple is spending a significant amount for Google’s Cloud Platform, with the figure pegged at somewhere between $400 and $600 million for the year.
However, the deal may not last into the long term. Apple also appears to be building its own in house system to store data from its millions of consumer devices. Apple has announced that it will be opening three data centers soon, as it looks to cut the estimated $1 billion that it spent purchasing data services from Amazon last year. Analysts expect that Apple may break even on its own data centers in about three years, as costs would be lower than the fees it would pay to Amazon, Google, and Microsoft.
Even if the deal is short lived, Google will continue to step up efforts to secure larger contracts for its data services. Previously the company had focused on smaller companies and start-ups, but last month the tech giant announced that Spotify’s music streaming service would be moving over to the Google Cloud platform from AWS.
Cloud-computing services are a major focus for Google going forward. The company anticipates that it may generate more revenue from these types of services than it does from advertising by the year 2020.