“Google Cloud Bets $3.3 Billion More Against Its Rivals - Market Realist” plus 2 more

Google Cloud Bets $3.3 Billion More Against Its Rivals - Market Realist
Linux Foundation exec believes edge computing will be more important than cloud computing - ZDNet
AWS, Azure or Google: Do the differences between cloud providers really matter? - Cloud Tech

Google Cloud Bets $3.3 Billion More Against Its Rivals - Market Realist

Posted: 23 Sep 2019 11:04 AM PDT

Google Cloud plans to spend $3.3 billion more to expand its data center presence across Europe over the next two years. Google's (GOOGL) planned Europe data center investment includes $660 million that will go to expand its Hamina data center in Finland. That move will bring Google's investment in the Hamina data center to about $2.2 billion since 2009.

As data centers underpin cloud computing, cloud providers typically open more data centers or expand existing data centers to expand their cloud computing capacity. I think that's what Google's trying to achieve with its planned data center investments in Europe.

Europe is turning out to be a hot battleground for the top cloud computing companies. Europe's cloud market should expand 22% annually for the next three years. As we discussed earlier at Market Realist, Alibaba (BABA) has also been expanding its cloud capacity in Europe.

Meanwhile, Amazon (AMZN) and Microsoft (MSFT) also operate data centers in Europe that support their cloud services. Microsoft, for instance, has detailed plans for more data centers in the region to boost its cloud capacity.

Huge revenue opportunity for Google's cloud business

Demand for cloud services remains strong globally. I think that strength is encouraging companies like Google to make huge investments and expand their cloud infrastructure. Global spending on cloud services is set to rise to over $214 billion in 2019 from $182.4 billion in 2018, Gartner estimates. By 2022, the global cloud market should surpass $330 billion.

Google's planned Europe data center investment follows the company setting its sights on attracting large cloud customers. As we discussed earlier, Google has hired former SAP SE (SAP) executives to help attract big cloud customers. Plus, Google's expanding its cloud sales team to generally help it grow its cloud market share.

Presently, Amazon and Microsoft rule the global cloud market with 33% and 16% market shares, respectively, according to Synergy Research. Google comes in third with 8.0% market share. However, as we saw here, Google aims to overtake Microsoft by 2024 and become the world's second-largest cloud company.

Diversifying revenue sources

I think Google needs a big break in the cloud market to reduce its overreliance on advertising dollars. Currently, advertising contributes the vast majority of Google's revenue. While Google remains the top digital advertising company, it's no longer a sure bet. Amazon and other competitors are gaining ground in the digital advertising market, threatening Google's base.

So Google is looking for new revenue sources outside advertising, and cloud computing is one of the company's target markets. Currently, Google's tiny share of the cloud market shows it has more growth potential than rivals Amazon and Microsoft.

Linux Foundation exec believes edge computing will be more important than cloud computing - ZDNet

Posted: 23 Sep 2019 07:50 AM PDT

Edge computing

Once upon a time, back when we all had mainframes and then servers in our offices, we had edge computing. Our compute power was literally down the hall. Then, along came the cloud, and all that changed. Computers were hundreds of miles but milliseconds away. Now, with the rise of IoT, 5G, and our never-satisfied need for speed, edge computing is coming back with a vengeance. Indeed, at his keynote at Open Networking Summit in Belgium, Arpit Joshipura, The Linux Foundation's general manager of networking, said "edge computing will overtake cloud computing" by 2025.

When Joshipura is talking about edge computing, he means compute and storage resources that are five to 20 milliseconds away. He also means edge computing should be an open, interoperable framework. This framework should be independent of hardware, silicon, cloud, or operating system. Open-edge computing should also work with any edge-computing use case: Internet of Things (IoT) edge, a telecom edge, cloud edge, or enterprise edge, whatever, "Our goal here is to unify all of these."

This is being done via LF Edge. This Linux Foundation organization seeks to bring all edge computing players under one umbrella with one technology. Its purpose is to create a software stack that unifies a fragmented edge market around a common, open vision for the future of the industry.

To make this happen, Joshipura announced two more projects were being incorporated into LF Edge: Baetyl and Fledge.

Formerly known as Baidu OpenEdge, Baetyl is meant to seamlessly extend cloud computing, data, and services to edge devices, thus enabling developers to build light, secure, and scalable edge applications. Its target audience is IoT edge device developers who need cloud computing, data, and services.

Why did Baidu, China's answer to Google, contribute the code to LF Edge? Watson Yin, a Baidu VP, explained: "[Baidu] decided to donate Baetyl, the intelligent edge computing framework, to the community, hoping to reciprocate the open-source community while continuously contributing cutting-edge technologies to the global technology ecosystem."

In short, Baidu, like so many other companies, believes that open source helps its business.

Fledge, once known as FogLAMP, is an open-source framework and community for the industrial edge. Its focus is on critical operations, predictive maintenance, situational awareness, and safety. Fledge is designed to integrate Industrial Internet of Things (IIoT), sensors and modern machines by sharing a common set of administration and application APIs with industrial "brown field" systems and the cloud.

Like Baidu, Flege's creator, Dianomic Systems, brought its project to LF Edge because the company believes both the program and the business will be the better for it.

Tom Arthur, Dianomic Systems' CEO and co-founder, stated: "The LF Edge's efforts for an open, interoperable framework for the edge is especially needed for the industrial factory, plant, and mine -- where almost every brown field system, piece of equipment, or sensor uses its own proprietary protocols and data definitions."

That all sounds well and good for edge computing users and companies, but why does Joshipura think that edge computing will overtake cloud computing? After all, Gartner estimated the total worth of the public cloud market in 2019 will be $214.3 billion, with a growth rate of 17.5%. For that, you need to take a close look at LF Edge's view of edge computing.

In it, the LF Edge sees industrial, enterprise and consumer use cases in complex environments spanning multiple edges and domains (a.k.a pretty much everywhere). Edge computing also has killer apps. These include video content delivery, autonomous vehicles' augmented and virtual reality, 5G, and gaming.

There are two reasons you haven't heard more about important edge computing is going to be. The first is that edge computing efforts have often been at cross-purposes. The LF Edge's primary reason for existence is to bring unity to edge computing. The other reason is that most of edge computing's killer apps aren't here yet.

The key word is "yet."

With more and more support for the LF Edge and its projects, and the rise of these new technologies Joshipura may yet be proven right. Stay tuned.

Compute options

Though we are able to align comparable products across AWS, Azure, and Google Cloud, there are of course differences between these offerings. In fact, with the number of products and services available today (we've counted 176 from AWS alone), comparing each is beyond the scope of this article.

For our purposes, we can compare what is still the core product for cloud service providers: compute. Compute products make up about two thirds of most companies' cloud bills, so the similarities and differences here will account for the core of most users' cloud experiences.

Here's a brief comparison of the compute option features across cloud providers:

Of course, if you plan to make heavy use of a particular service, such as Function-as-a-Service/serverless, you'll want to do a detailed comparison of those offerings on their own.

Pricing

That covers functionality. How do the prices compare? One way to do this is by selecting a particular resource type, finding comparable versions across the cloud providers, and comparing prices. Here's an example of a few instances' costs as of this writing (all are Linux OS):

For more accurate results, pull up each cloud provider's price list. Of course, not all instance types will be as easy to compare across providers – especially once you get outside the core compute offerings into options that are more variable, more configurable, and perhaps even charged differently (in fact, AWS and Google actually charge per second).

Note that AWS and Azure list distinct prices for instance types with the Windows OS, while Google Cloud adds a per-core license charge, on top of the base instance cost.

The table above represents the default On Demand pricing options. However, each provider offers a variety of methods to reduce these base costs, which we'll look at in the Purchasing Options section.

Terminology

At first glance, it may seem like the cloud providers each have a unique spread of offerings. But many of these products and services are quite similar once you get the names aligned. Here are a few examples:

Obviously, this is not a sign of substantive differences in offerings – and just goes to show that the providers are often more similar than it might appear at first glance.

Purchasing options

Comparisons of the myriad purchasing options are worth several articles on their own, so I'll keep it high level here. These are the most commonly used – and discussed – options to lower costs from the listed On Demand prices for AWS, Microsoft Azure, and Google Cloud.

Reservations

Each of the major cloud providers offers a way for customers to purchase compute capacity in advance in exchange for a discount: AWS Reserved Instances, Azure Reserved Virtual Machine Instances, and Google Committed Use discounts. There are a few interesting variations, for example, AWS offers an option to purchase "Convertible Reserved Instances", which allow reservations to be exchanged across families, operating systems, and instance sizes. On the other hand, Azure offers similar flexibility in their core Reserved VM option. Google Cloud's program is somewhat more flexible regarding resources, as customers must only select a number of vCPUs and memory, rather than a specific instance size and type.

What about if you change your mind? AWS users have the option to resell their reservations on a marketplace if they decide they're no longer needed, while Azure users will pay a penalty to cancel, and Google users cannot cancel.

Spot and preemptible instances

Another discounting mechanism is the idea of spot instances in AWS, low-priority VMs in Azure, and preemptible VMs, as they're called on Google. These options allow users to purchase unused capacity for a steep discount. The cost of this discount is that these instances can be interrupted (or perhaps Azure puts it best with their "evicted" term) in favor of higher priority demand – i.e. someone who paid more. For this reason, this pricing structure is best used for fault-tolerant applications and short-lived processes, such as financial modeling, rendering, and testing. While there are variations in the exact mechanisms for purchasing and using these instance types across clouds, they have similar discount amounts and use cases.

Sustained use discounts

Google Cloud Platform offers another cost-saving option that doesn't have a direct equivalent in AWS or Azure: Sustained Use Discounts. This is an automatic, built-in discount for compute capacity, giving you a larger percentage off the more you run the instance. Be aware that the GCP prices listed can be somewhat misleading, as a sustained use discount is already built in, assuming full-month usage – but it is nice to see the cloud provider looking after its customers and requiring no extra cost or work for this discount.

Contracts

A last sort of "purchasing option" is related to contract agreements. With all three major cloud providers, enterprise contracts are available. Typically, these are aimed at enterprise customers, and encourage large companies to commit to specific levels of usage and spend in exchange for an across-the-board discount – for example, AWS EDPs, Azure Enterprise Agreements. As these are not published options and will depend on the size of your infrastructure, your relationship with the cloud provider, etc., it's hard to say what impact this will have on your bill and how it will compare between clouds.

The 'it' factor

There's also just the pure perception of the differences between cloud providers.

For instance, some may perceive Azure as a bit stodgy, while Google Cloud seems slick but perhaps less performant than AWS. Some appreciate AWS and Azure's enterprise support more and find Google Cloud lacking here, but this is changing as Google onboards more large customers and focuses on enterprise compatibility.

There are also perceptions regarding ease of use, but actually, we find these to be most affected by the platform you're used to using. Ultimately, whatever you're most familiar with is going to be the easiest – and any can be learned.

Do the differences really matter?

On some of the factors we went through above, the cloud providers do have variations. But on many variables, the providers and their offerings are so similar as to be equivalent. If there's a particular area that's especially important to your business (such as serverless, or integration with Microsoft applications), you may find that it becomes the deciding factor.

The fact of the matter is, you're likely to be using multiple clouds soon, if you're not already – so you will have access to the advantages of each provider. Additionally, applications and data are now more portable than ever due to containers.

So, prepare yourself and your environment for a multi-cloud reality. Build your applications to avoid vendor lock-in. Use cloud-agnostic tools where possible to take advantage of the benefits of abstraction layers.

Even if you're only considering one cloud at the moment, these choices will benefit you in the long run. And remember: if your company is telling you to use a specific cloud provider, or an obscure requirement drives you to one in particular – don't worry. The differences don't matter that much.

Interested in hearing industry leaders discuss subjects like this and sharing their experiences and use-cases? Attend the Cyber Security & Cloud Expo World Series with upcoming events in Silicon Valley, London and Amsterdam to learn more.

Cloud artiicle 14

Monday, September 23, 2019