Google Cloud Worth $225B, Deutsche Bank Says(bloomberg.com)
bloomberg.com
Google Cloud Worth $225B, Deutsche Bank Says
https://www.bloomberg.com/news/articles/2019-10-03/google-cloud-worth-double-ibm-s-market-cap-deutsche-bank-says
220 comments
I feel they entered the business because they AWS showed the industry that it actually has pretty good margins.
However, I think the sentiment is probably true that selling VPS is low-margin over the long-term, but i think the margins come from the other bits: global economies of scale, good infrastructure management & practices, and providing their proven internal technologies (ML/AI, managed distributed services). Long-term, it seems like Google could come out the winner, but only if the other aspects of business are also done well (like sales). It seems like Google Cloud is picking up market share, but still far away from the 3 As (AWS, Azure, Alibaba)
However, I think the sentiment is probably true that selling VPS is low-margin over the long-term, but i think the margins come from the other bits: global economies of scale, good infrastructure management & practices, and providing their proven internal technologies (ML/AI, managed distributed services). Long-term, it seems like Google could come out the winner, but only if the other aspects of business are also done well (like sales). It seems like Google Cloud is picking up market share, but still far away from the 3 As (AWS, Azure, Alibaba)
Market share is measured in some very, very funny ways. Like Office 365 being part of their cloud division, including when people download and install office on their computer. If Google was to switch things around, and have Ad-words, Gmail, maps, etc, all pay a small, internal fee to google cloud to host their servers own internal servers, I think the market-share conversation would be very, very different.
Most of internal Google services don't run on Google cloud. Was true as of a couple of years ago and I haven't heard differently from my Google friends recently.
Just reclassify Borg as Google Cloud Internal Edition and boom, everything runs on Google Cloud. This sounds stupid but it's no worse than what MS and IBM have done. Heck, when you are your own customer maybe you could even double-count some revenue...
FWIW... most of Amazon's internal infrastructure was NOT run on AWS as of a couple of years ago. The idea that AWS was built to support Amazon is a myth. In fact, most of their own IaaS was a very traditional data center built on converged infrastructure. This is why Amazon was up and running when AWS would have a large outage.
>> Like Office 365 being part of their cloud division, including when people download and install office on their computer.
It's even sillier than that: Microsoft counts (a significant portion of) boxed copies of Office that you buy in a store as Azure cloud revenue. The justification being that buying a copy Office in a box gets you the right to the cloud-based version rather than the offline one you actually bought. Ultimately it's about flexibility.
And in this case, the flexibility to make your Cloud business whatever percentage of your total company revenue it might take in order to claim the market share numbers you want.
It's even sillier than that: Microsoft counts (a significant portion of) boxed copies of Office that you buy in a store as Azure cloud revenue. The justification being that buying a copy Office in a box gets you the right to the cloud-based version rather than the offline one you actually bought. Ultimately it's about flexibility.
And in this case, the flexibility to make your Cloud business whatever percentage of your total company revenue it might take in order to claim the market share numbers you want.
I think you hit the nail on the head with managed services. In 2006 Google probably wasn't thinking much further than EC2 and S3
> I feel they entered the business because they AWS showed the industry that it actually has pretty good margins.
And they stayed because of Azure. Azure was making huge profit when google decided to increase number of data centers. This wouldn't be coincidence, IMO.
And they stayed because of Azure. Azure was making huge profit when google decided to increase number of data centers. This wouldn't be coincidence, IMO.
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My understanding was that market share is: AWS > Azure > GCP > Alibaba
The ad business is almost completely margin, almost any other business is going to be lower margin.
Yep, it reminds me of Dutch Disease [1] in economics where countries that happen upon an enormously profitable natural resource see a decline or an inability to compete internationally in other sectors of their economy.
[1] - https://en.wikipedia.org/wiki/Dutch_disease
[1] - https://en.wikipedia.org/wiki/Dutch_disease
Lucking across a local maximum seems to warp peoples' perspective on what to do next.
Of course little else is going to look like a better idea! Every direction is downhill!
But every other local maximum can only be reached by first crossing a valley.
Of course little else is going to look like a better idea! Every direction is downhill!
But every other local maximum can only be reached by first crossing a valley.
Whoever concluded that the margin is low is probably plain clueless about the enterprise IT, or they were looking at developer-friendly tech gigs or colo-providers, etc, not the IBM Oracle EMC Vmware NetApp etc.
When I joined Amazon in 2012, the message is clearly that AWS competes with IBM Oracle EMV Vmware NetApp. I do not have proof if the original plan was that in the early days. But given my impression on Amazon and AWS' executive team, I'd say very likely enterprise IT has always been Amazon's end game.
When I joined Amazon in 2012, the message is clearly that AWS competes with IBM Oracle EMV Vmware NetApp. I do not have proof if the original plan was that in the early days. But given my impression on Amazon and AWS' executive team, I'd say very likely enterprise IT has always been Amazon's end game.
I think AWS made a change in strategy between 2006 and 2012 because their early architecture and marketing were totally anti-enterprise.
Naturally you have to start with developer friendly marketing as a new comer, there is no direct to enterprise marketing workable for aws (which will be too expensive and an uphill battle)
Obviously I have zero information about how they came to that conclusion, but it sounds to me like they looked too far into the future.
With basically every major tech company (Amazon, Google, Microsoft, IBM) now having some cloud offering and so many companies switching their on-site infrastructure for the cloud, it seems like it's only a matter of time until compute time becomes a commodity. Once that happens pricing becomes a race to the bottom and margins become much smaller.
With basically every major tech company (Amazon, Google, Microsoft, IBM) now having some cloud offering and so many companies switching their on-site infrastructure for the cloud, it seems like it's only a matter of time until compute time becomes a commodity. Once that happens pricing becomes a race to the bottom and margins become much smaller.
> compute time becomes a commodity
The cloud is enormously expensive if people are buying it for "compute time".
But that's the miscalculation: thinking people buy cloud for "compute time". By and large they do not. They buy cloud for flexible provision, robust management, easier deployment, and better monitoring.
And those are differentiated qualities.
The cloud is enormously expensive if people are buying it for "compute time".
But that's the miscalculation: thinking people buy cloud for "compute time". By and large they do not. They buy cloud for flexible provision, robust management, easier deployment, and better monitoring.
And those are differentiated qualities.
I see a very different list of core benefits: more of ops, compliance, procurement is someone else's problem; capital conservation; and it's what the kids use to go fast, familiarity.
Compute being a commodity doesn't matter when storage has significant lock in, with cheaper prices for using the localized storage service of a particular cloud provider.
Even if moving a containerized application across cloud services was as simple as clicking a few buttons, if you're doing any sort of logging, and especially later any computation over those logs, you will be locked in one way or another.
Even if moving a containerized application across cloud services was as simple as clicking a few buttons, if you're doing any sort of logging, and especially later any computation over those logs, you will be locked in one way or another.
Why does this argument get made so much? Why is it assumed that the market will behave this way?
Probably because "product life-cycle" is MBA 101.
Not sure if this is the original from HBR but it is from 1965: https://hbr.org/1965/11/exploit-the-product-life-cycle
From "Maturity Stage":
> The market maturity stage typically calls for a new kind of emphasis on competing more effectively. The originator is increasingly forced to appeal to the consumer on the basis of price, marginal product differences, or both.
Not sure if this is the original from HBR but it is from 1965: https://hbr.org/1965/11/exploit-the-product-life-cycle
From "Maturity Stage":
> The market maturity stage typically calls for a new kind of emphasis on competing more effectively. The originator is increasingly forced to appeal to the consumer on the basis of price, marginal product differences, or both.
Because we have 100 years of free market capitalist based economic history that it would be unwise to ignore?
Enterprise computing was already pretty mature in the pre-cloud era yet prices were (and still are) very high. So when exactly does this commoditization kick in? 50 years? 100?
Enterprise computing? In what sense? Colocated hosting is indeed a race to the bottom, as are renting of bare metal servers and VPS’s
That's because that was 2006. They were wrong. There is nothing wrong with saying that. Corporations change strategies every 90 days, there is no reason for the infallible cult leader admiration.
Google AppEngine launched in 2008.
Google Cloud Storage launched in 2010
Google has been chasing Amazon since AWS started, and has been accelerating investment.
Google Cloud Storage launched in 2010
Google has been chasing Amazon since AWS started, and has been accelerating investment.
I thought margin on the cloud business is pretty high...
Margins are high because it's expensive. Cloud is in a big growth curve because it operationalizes capital spend and time to market (key for startups) and they have amazing software stacks which let you dump legacy people and costs.
But once you are there and make the cloud/devops process part of your DNA, you may find that it isn't the optimal place to live from a cost perspective. I moved a workload from a big cloud provider to a private datacenter recently and reduced the costs on an annual basis by like 60%. We did need to make a big capital investment.
But once you are there and make the cloud/devops process part of your DNA, you may find that it isn't the optimal place to live from a cost perspective. I moved a workload from a big cloud provider to a private datacenter recently and reduced the costs on an annual basis by like 60%. We did need to make a big capital investment.
There's more to being in a high-margin business than just putting your prices up and watching the money roll in. It depends (among other things) upon what you're selling. My sense is that what Google overlooked was the opportunity to add value.
It is today, but it won't last. As automation tooling gets better the barriers to entry drop and competition kicks in and lowers prices. You can see it already: Aws are constantly lowering their prices. It's not just to be nice, they're competing hard.
Core infrastructure may or may not be low margin (traffic rates are nearly pure margin designed to create a moat and may or may not eventually be challenged by regulators as anti-competitive; it remains to be seen). But the lion's share of cloud margin comes from value-added managed services e.g. AWS Lambda and GCP PubSub, which are exceedingly more expensive than their underlying infrastructure but not nearly so expensive as to justify small companies hiring FTE to manage open-source equivalents. And there aren't nearly enough cloud players to justify competition building out competing implementations for, say, the Lambda API, with the sole exception coming to mind being competing object storage providers implementing the S3 API.
Multi-cloud isn't a myth, but it's pretty close. It requires lots of discipline that most customers won't have. The smart money is on cloud providers improving their margins, not shrinking them.
Multi-cloud isn't a myth, but it's pretty close. It requires lots of discipline that most customers won't have. The smart money is on cloud providers improving their margins, not shrinking them.
I promise you this isn't true, maybe over the long term the value add services will be higher margin, but for most of the big players right now the margins are in the core infrastructure aspects like standard storage and compute.
I don't think your statements about (a) where cloud margins come from and (b) Lambda vs VM cost are correct.
> the barriers to entry drop
The barriers for entry on the Cloud will never drop. The Cloud grows more and complex and regional data centers across the globe are impossible for any company without gobs of money to compete with. The margins will drop, but only because the competition between the big 3 has barely even started; even that I believe is a decade away.
The barriers for entry on the Cloud will never drop. The Cloud grows more and complex and regional data centers across the globe are impossible for any company without gobs of money to compete with. The margins will drop, but only because the competition between the big 3 has barely even started; even that I believe is a decade away.
This is just history repeating itself.
The same thing happened with the underlying server/architecture/processor providers. For a while it a vibrant field with multiple competitors and high margins. After a while, competition and differentiation drove down margins.
When the margins drop only the best players will be left. Those players will buy out the competition until there's just 2 or 3 big players who will then ratchet up the prices until they reach a stable equilibrium.
And then another layer gets added to this tasty lasagna:
- Processor
- Architecture
- OS
- VirtualizationService
- CloudProvider
And then we start the process of innovation to margin squeeze again...
The same thing happened with the underlying server/architecture/processor providers. For a while it a vibrant field with multiple competitors and high margins. After a while, competition and differentiation drove down margins.
When the margins drop only the best players will be left. Those players will buy out the competition until there's just 2 or 3 big players who will then ratchet up the prices until they reach a stable equilibrium.
And then another layer gets added to this tasty lasagna:
- Processor
- Architecture
- OS
- VirtualizationService
- CloudProvider
And then we start the process of innovation to margin squeeze again...
> The margins will drop, but only because the competition between the big 3 has barely even started; even that I believe is a decade away.
Why? My guess is that the market for Cloud computing is constantly expanding and there isn't a plateau in sight?
Why? My guess is that the market for Cloud computing is constantly expanding and there isn't a plateau in sight?
I suppose it depends on the amount of lock-in they can achieve, if it's hard to move from one provider to another then that will keep margins higher.
> barriers to entry drop
Are more providers entering into the cloud space? I thought AWS and Azure had this on lock down, with Google a third fiddle.
Are new companies able to enter this space now? I assume the capital investment required for allocating and maintaining tons of data centers at edge nodes that are globally distributed would be too steep.
Are more providers entering into the cloud space? I thought AWS and Azure had this on lock down, with Google a third fiddle.
Are new companies able to enter this space now? I assume the capital investment required for allocating and maintaining tons of data centers at edge nodes that are globally distributed would be too steep.
Arguably the CDNs (Akamai, CloudFlare and friends) have made the capital investment, and are now in the cloud business.
But I don't see anybody competing with AWS/Azure/GCP anytime soon.
But I don't see anybody competing with AWS/Azure/GCP anytime soon.
Maaaaaybe. I see the CDNs bringing on compute & durablish storage at the edge. And id buy the argument theyre positioning themselves for the next round of “cloud” ala Lambda + DynamoDB.
But I strongly object to the capital characterization. Akamai, the gorilla in the CDN room, to looks to have capital expenditures of $200M or so for hardware/colo/etc. Cloudflare was spending $20-30M IIRC. Conversely Amazon “Cash capital expenditures were $6.7 billion, $10.1 billion, and $11.3 billion in 2016, 2017, and 2018, which primarily reflect additional capacity to support our fulfillment operations and additional investments in support of continued business growth in technology infrastructure (the majority of which is to support AWS).”
Money alone doesnt buy success but the CDN guys dont seem to showing up to the game yet. As youve noted I dont really see anyone else on the trajectory to general competition with the big three.
Disclaimer: Im a principal at AWS and have worked on CloudFront. All my comments are based on my personal reading of publicly available data like 10K & S1 filings.
But I strongly object to the capital characterization. Akamai, the gorilla in the CDN room, to looks to have capital expenditures of $200M or so for hardware/colo/etc. Cloudflare was spending $20-30M IIRC. Conversely Amazon “Cash capital expenditures were $6.7 billion, $10.1 billion, and $11.3 billion in 2016, 2017, and 2018, which primarily reflect additional capacity to support our fulfillment operations and additional investments in support of continued business growth in technology infrastructure (the majority of which is to support AWS).”
Money alone doesnt buy success but the CDN guys dont seem to showing up to the game yet. As youve noted I dont really see anyone else on the trajectory to general competition with the big three.
Disclaimer: Im a principal at AWS and have worked on CloudFront. All my comments are based on my personal reading of publicly available data like 10K & S1 filings.
"Your margin is my opportunity." [1]
[1] https://quoteinvestigator.com/2019/01/13/margin/
[1] https://quoteinvestigator.com/2019/01/13/margin/
You forgot storage and the huge lock-in that storage has.
It would cost $850,000 to move 10PB of data out of a cloud. People aren't going to do it. They aren't going to be able to afford to do it.
It would cost $850,000 to move 10PB of data out of a cloud. People aren't going to do it. They aren't going to be able to afford to do it.
AWS Snowball puts 10PB at $350k. They are already paying 200k/month for 10PB, paying 2 months worth to move it doesn't seem outrageous to me.
It is, though it requires significant capital.
And it was widely thought to not be high margin at the time. Cloud prices have not fallen as fast as hardware.
FWIW, many people still think it will become low margin.
And it was widely thought to not be high margin at the time. Cloud prices have not fallen as fast as hardware.
FWIW, many people still think it will become low margin.
It is, but that wasn't anticipated at the time and Amazon didn't reveal its margins until much later.
I believe most GCP services lose money. A few years ago when I left only a handful were profitable. It's probably profitable now overall, but not as wildly as one might think. Hence the recent curb-stomping of Diane Green.
I would say the Google strategy was wrong.
For every AWS API with significant adoption, Google should have implemented it. Make transitioning from AWS to GCE as simple as possible.
For every AWS API with significant adoption, Google should have implemented it. Make transitioning from AWS to GCE as simple as possible.
I'm really glad they took the opportunity to change the APIs and abstractions around. Some of the ones exposed by AWS are absolutely insane.
Not to mention some of the paradigms: regionalized dashboards/endpoints, the mess that is EC2Classic/VPC, lack of projects for compartmentalization/namespacing ... a lot of those APIs also leak internal implementation details of their products, and trying to match them would be silly.
And they did follow one API that everybody else has: S3. And that one is decent only because it's basically HTTP with some auth headers sprinkled in.
My overall experience with GCloud is much better thanks to these redesigns. AWS just seems like an underdesigned mess of loosely coupled components implemented by siloed teams.
Not to mention some of the paradigms: regionalized dashboards/endpoints, the mess that is EC2Classic/VPC, lack of projects for compartmentalization/namespacing ... a lot of those APIs also leak internal implementation details of their products, and trying to match them would be silly.
And they did follow one API that everybody else has: S3. And that one is decent only because it's basically HTTP with some auth headers sprinkled in.
My overall experience with GCloud is much better thanks to these redesigns. AWS just seems like an underdesigned mess of loosely coupled components implemented by siloed teams.
> AWS just seems like an underdesigned mess of loosely coupled components implemented by siloed teams
That was my experience as well. It felt like they never included any UX person throughout any of the decisions. Their naming convention alone always seemed confusing to me, although it does seem to be improving.
That was my experience as well. It felt like they never included any UX person throughout any of the decisions. Their naming convention alone always seemed confusing to me, although it does seem to be improving.
I don't follow you. Your suggestion just serves to turn this into a commodity low-margin business. What benefit does google have for doing that?
Google sees Amazon as its biggest and most threatening competitor. Starving your competitor of lots of high-margin revenue is a good thing to do.
If there's margin to be had, the first step is having customers.
AWS was the clear leader, and sure, you can try to attract different customers... but they should have also tried to make it as easy as possible for existing AWS customers to migrate.
Then, you offer your customers additional services that the other guy doesn't offer.
AWS was the clear leader, and sure, you can try to attract different customers... but they should have also tried to make it as easy as possible for existing AWS customers to migrate.
Then, you offer your customers additional services that the other guy doesn't offer.
Your question is basically how does hosting a quarter of the internet make money, well Amazon benefits a mil+ an hour in profit off AWS margins... plenty to entice Google and Microsoft to compete.
If we're using stock price as a metric to judge strategy, GOOG's gains have been stomped by AMZN since 2006 by about 8x: https://yhoo.it/30KNk3A
By that chart, GOOG's only about 5x-ed since 2006.
By that chart, GOOG's only about 5x-ed since 2006.
If you compare most companies to one of the best-performing publicly traded company in the history of the world, you'll find they'll get "stomped". Who is the say they wouldn't have lost money and done worse?
If they would have invested in on-demand streaming video, maybe they wouldn't have been "stomped" by Netflix's 60x return since a similar date?
If they would have invested in on-demand streaming video, maybe they wouldn't have been "stomped" by Netflix's 60x return since a similar date?
We're looking at the specific decision of whether or not to have invested in cloud services, which the GP poster said the Google execs had looked into and made a decision that was clearly wrong, which should have been obvious even when they made it. AWS helped Netflix build a competitor to Prime Video, but if Amazon didn't have AWS, Netflix would have just used another vendor.
> we should keep our infrastructure to ourselves.
Hilarious, now that we know amazon builds better infrastructure. How they say it? „don’t buy your own hype“!
Hilarious, now that we know amazon builds better infrastructure. How they say it? „don’t buy your own hype“!
(I work for Azure, so I don't really have a dog in this fight.)
Google's cloud seems pretty capable, they're just going through teething. They got to live migration extremely fast, and they seem to have nailed BigQuery and Spanner (albeit not the pricing model.) They will get more reliable.
Internally though, Google was (and maybe still is) a decade ahead. With Borg they deployed their entire infrastructure as containers, running at insanely high utilization via Heracles, and built homogeneous and highly-scalable networking. They invented synchronous georeplication with Spanner. From all accounts, it's a paradise.
It just turned out they were too greedy with keeping their innovations to themselves, too egotistical to believe the rest of the world would catch up, and it was too difficult to productize their infra.
For instance, their containers can only rely on API filters for security, so they couldn't bring Borg to the masses, other than cutting it down dramatically to make Kubernetes and requiring it to run on VMs. It looks like Spanner is also priced by the core, which implies it also can't be safely/compliantly commingled with their internal instances.
Still, for a company playing catch-up and needing to completely change their mindset (remember that initially they didn't even offer VMs), they're doing darn well. Especially now that they've pivoted to GKE/big data/ML and targeting multi-cloud or niche clients rather than enterprises.
Google deserves fame for its infra, it just didn't have good business sense when it came to cloud.
Google's cloud seems pretty capable, they're just going through teething. They got to live migration extremely fast, and they seem to have nailed BigQuery and Spanner (albeit not the pricing model.) They will get more reliable.
Internally though, Google was (and maybe still is) a decade ahead. With Borg they deployed their entire infrastructure as containers, running at insanely high utilization via Heracles, and built homogeneous and highly-scalable networking. They invented synchronous georeplication with Spanner. From all accounts, it's a paradise.
It just turned out they were too greedy with keeping their innovations to themselves, too egotistical to believe the rest of the world would catch up, and it was too difficult to productize their infra.
For instance, their containers can only rely on API filters for security, so they couldn't bring Borg to the masses, other than cutting it down dramatically to make Kubernetes and requiring it to run on VMs. It looks like Spanner is also priced by the core, which implies it also can't be safely/compliantly commingled with their internal instances.
Still, for a company playing catch-up and needing to completely change their mindset (remember that initially they didn't even offer VMs), they're doing darn well. Especially now that they've pivoted to GKE/big data/ML and targeting multi-cloud or niche clients rather than enterprises.
Google deserves fame for its infra, it just didn't have good business sense when it came to cloud.
> They will get more reliable
The road to higher reliability is a slow one when we are talking about cloud-level 9s. I get the feeling they are still in the early stages of adopting a B2B culture and everything that comes with that.
For example, the June global network outage was caused by a software bug that had global implications. AWS moved away from building software that crossed region boundaries years ago, I would guess because they had an issue like this one. It feels like GCP is many mistakes behind AWS.
Cloud reliability isn't due to genius, it's just software+infrastructure that has been improved again and again in response to new failure modes. I think it will be several years before GCP has reliability that is comparable to what AWS has today.
The road to higher reliability is a slow one when we are talking about cloud-level 9s. I get the feeling they are still in the early stages of adopting a B2B culture and everything that comes with that.
For example, the June global network outage was caused by a software bug that had global implications. AWS moved away from building software that crossed region boundaries years ago, I would guess because they had an issue like this one. It feels like GCP is many mistakes behind AWS.
Cloud reliability isn't due to genius, it's just software+infrastructure that has been improved again and again in response to new failure modes. I think it will be several years before GCP has reliability that is comparable to what AWS has today.
Compared to their ad business the cloud is lower revenue. Selling people is the real money maker.
I'd say it was wrong. Amazon and Microsoft now make huge amounts of money from their clouds. It can't be that low margin!
But I feel like their real mistake was trying to do things right, rather than compatibly. I think Google Cloud Engine is undeniably a better system than ad-hoc Linux VMs. But nobody really wants to rewrite all their code to work with it.
But I feel like their real mistake was trying to do things right, rather than compatibly. I think Google Cloud Engine is undeniably a better system than ad-hoc Linux VMs. But nobody really wants to rewrite all their code to work with it.
> The internal message was, we don't want to build a competitor.
Which is a fundamentally wrong analysis. Managed compute, network, and storage was going to happen whether or not Google got into the business, helping build Google's competitors. The only difference is that Amazon gets to collect the rent.
Just like Microsoft, which made bad decisions about the Internet but grew anyway so continued to reward its execs, Google completely fumbled in cloud but grew in other places and continued to overcompensate its execs.
Which is a fundamentally wrong analysis. Managed compute, network, and storage was going to happen whether or not Google got into the business, helping build Google's competitors. The only difference is that Amazon gets to collect the rent.
Just like Microsoft, which made bad decisions about the Internet but grew anyway so continued to reward its execs, Google completely fumbled in cloud but grew in other places and continued to overcompensate its execs.
Google Cloud is worth $225B and Waymo is worth $100B [1], so the rest of Alphabet is worth less than $500B in market cap? The math doesn't add up.
[1] https://www.cnbc.com/2019/09/27/waymo-valuation-cut-40percen...
[1] https://www.cnbc.com/2019/09/27/waymo-valuation-cut-40percen...
It's actually consistent. The point here is that Google Cloud is undervalued, hence the high buy rating with a target of $1.6k. That would imply a market cap of $~1.1 trillion, meaning that the worth of the rest of Alphabet (sans Cloud/Waymo valued @ $335B) would be $775B.
When we say "undervalued", you mean compared to competitors?
When the tech bubble bursts, either everyone gets bailed out, and it does become worth 200B. Or we are going to find out much of this tech money was speculation.
What's hard about running a server farm? Does it lend to this valuation?
When the tech bubble bursts, either everyone gets bailed out, and it does become worth 200B. Or we are going to find out much of this tech money was speculation.
What's hard about running a server farm? Does it lend to this valuation?
I'm not sure what "speculation" is meant to imply here. Deutsche is explicitly giving a speculative valuation here; they speculate that Google Cloud will reach $38 billion of revenue in 2025. But that's not some pie-in-the-sky impossible dream; AWS brought $25B (and operating income of $7B) last year.
There are two direct responses to your last question: all parts of running a server farm are hard, and a cloud platform is more than just a glorified server farm.
There are two direct responses to your last question: all parts of running a server farm are hard, and a cloud platform is more than just a glorified server farm.
The valuation doesn't add up. At 38B revenue we can assume 12B operating income so 20x profit. But your telling us today it is worth 225B not in 2025?
I can't find a copy of the analysis (it's unclear to me whether it's even public). But presumably Deutsche either thinks 38B is an an almost sure thing, or expects the business to grow even more after 2025.
No, undervalued means the market valuation of the company is less than what it should be. I.e. Deutsche Bank believes that Google's profits summed up for the future (and discounted to account for inflation/risk) will exceed what people are buying it for. As an example, if a share is $10 and it pays $5 per year then it's undervalued because it's value ≈ $5 + .9($5) + .9²($5) + .9³($5) + .... This is essentially how Deutsche Bank is setting their price target. Since their target exceeds the equilibrium price of Google, they have decided it's undervalued.
DB price target is $1600 which means they think Google is worth $1.1 Trillion.
Would be interesting to have a similar estimate for AWS. My personal pet theory is that (and was already at a stock price of 1k) that around 80% came from AWS. Since I'm by no means an expert getting real numbers would be nice!
It's DB, if they knew what they were talking about then maybe they could have predicted their own share price sliding 97% in a decade.
And even if they did know what they were talking about (read JP Morgan), that doesn’t mean their estimates are reliable. There are many forces/interests at play wrt these public statements, see the WeWork case.
This only means that Deutsche Bank is long on Google. 99% of these analyses are extremely biased and purposeful.
I'm not trying to peddle "banks are evil" it's normal, it's how this business works.
I worked in a leading asset management firm and never met a truly rich analyst. Usually bureaucratic employees nobody at the trading desk takes seriously.
I'm not trying to peddle "banks are evil" it's normal, it's how this business works.
I worked in a leading asset management firm and never met a truly rich analyst. Usually bureaucratic employees nobody at the trading desk takes seriously.
You can search for "Chinese Wall" in the context of banks for more context on this.
Google is dumping money into their enterprise programs. They hired some experienced people to run it. Their offerings are soooo much better quality than AWS. Try getting a GPU vm with a local SSD on AWS, does not exist... In GCP I can set custom values for CPU, MEM, GPU, SSD. Try to ssh to a machine, and then one without a public network connect.
Google is the only provider with a good portal to their partner program. They can actually communicate and we now have a dedicated account rep.
Google is the only provider with a good portal to their partner program. They can actually communicate and we now have a dedicated account rep.
> a GPU vm with a local SSD on AWS, does not exist
I'm pretty sure that's not true. I believe you can get V100s or T4s with local NVMe SSDs.
I'm pretty sure that's not true. I believe you can get V100s or T4s with local NVMe SSDs.
I looked just before the T4 landed at Amazon a monthish ago, GCP has had them almost a year now.
You're right though, what I meant was a machine I could do a hypervisor with, which is any VM on Google Cloud. Need baremetal on AWS, and that type does not have GPU options.
You're right though, what I meant was a machine I could do a hypervisor with, which is any VM on Google Cloud. Need baremetal on AWS, and that type does not have GPU options.
They're good until you get automatically banned for some reason and there is zero people you can contact to fix it.
Maybe don't run your critical service on a consumer google account that you're also doing shady stuff with?
I have people I can call, we have a business account.
We are going to be upgrading soon to a special partner account that gives us an enhanced portal / cloud console to make managing our clients' accounts much easier.
We migrate companies from AWS to GCP. If anyone is interested, please reach out. Happy to provide reference accounts.
We are going to be upgrading soon to a special partner account that gives us an enhanced portal / cloud console to make managing our clients' accounts much easier.
We migrate companies from AWS to GCP. If anyone is interested, please reach out. Happy to provide reference accounts.
Or they could just go visit https://cloud.google.com/support/ themselves.
Not one mention of AWS.
http://paulgraham.com/submarine.html
http://paulgraham.com/submarine.html
I hadn't read this submarine article before. This just blew my mind. I've got so many ideas for promoting my side business now.
The content farms (and Wikipedia) are modern day version of the print publications.
Wouldn't it be ironic if pg was paid by a PR firm to write this piece? :D
Wouldn't it be ironic if pg was paid by a PR firm to write this piece? :D
On an aside, Paul Graham clearly saw influencer marketing coming in his final paragraph.
The essay is from 2005. Internet marketers were seeing that trend in the run up to the dot com bubble. And porn sites were seeing it even earlier. (Internet marketers were learning from the latter at the time.)
Not surprised.
If AWS can't make their UI a bit more user-friendly (especially for beginners) and remove their AWS Educate for students (which by the way is horrible), I think a good chunk of developers and possible institutions might move over to GCP.
Other that UI, I think GCP in some instances may be cheaper (pretty sure I saw some instances that were cheaper... although I can't say for sure).
Other that UI, I think GCP in some instances may be cheaper (pretty sure I saw some instances that were cheaper... although I can't say for sure).
Why people keep saying that GCP UI/UX is good. Is it because of Firebase? Because granted, that's a very nice UX. But when you log in to the GCP console that thing is a fucking mess. Way more complicated than AWS, with a very subpar UX...
And don't get me started with their documentation. What a piece of crap. It's like nobody thought that things of this nature require a clear hierarchy. It's just a blob of concepts organized in no meaningful way... Not saying that AWS is perfect, but at least with their documentation, you just gotta keep reading until you find what you need. With Google Cloud sometimes you hit these walls that take you out of context and the only solution is to close that tab and start again.
Ohh. And just to be fair with everyone crappiness in this space, Azure is even worse. Their console is another horrible experience.
Nobody in this industry thought about the UX of these things. They are all disastrous...
And believe me that I have studied this from multiple angles. I worked at AWS for two years trying to solve UX issues and it's just an endless battle. Developers deserve better user experiences... Nobody is thinking about this with the intensity and focus that it deserves.
And don't get me started with their documentation. What a piece of crap. It's like nobody thought that things of this nature require a clear hierarchy. It's just a blob of concepts organized in no meaningful way... Not saying that AWS is perfect, but at least with their documentation, you just gotta keep reading until you find what you need. With Google Cloud sometimes you hit these walls that take you out of context and the only solution is to close that tab and start again.
Ohh. And just to be fair with everyone crappiness in this space, Azure is even worse. Their console is another horrible experience.
Nobody in this industry thought about the UX of these things. They are all disastrous...
And believe me that I have studied this from multiple angles. I worked at AWS for two years trying to solve UX issues and it's just an endless battle. Developers deserve better user experiences... Nobody is thinking about this with the intensity and focus that it deserves.
In GCP, I çan see all my instances of all regions in one go. I can't do that with aws.
In GCP, I can easily create networks between projects. It's really shitty to do in aws.
In GCP, I can create a machine and everyone in my team automatically has ssh access.
In GCP, I can make an instance, then mark the IP as reserved. In aws, I have to reserve the IP first.
Aws UX is the worst. I use both on an everyday basis. I could go on and on..
In GCP, I can easily create networks between projects. It's really shitty to do in aws.
In GCP, I can create a machine and everyone in my team automatically has ssh access.
In GCP, I can make an instance, then mark the IP as reserved. In aws, I have to reserve the IP first.
Aws UX is the worst. I use both on an everyday basis. I could go on and on..
It seems that you are talking about features. I never said that AWS UX isn't horrible. It is. But GCP is also pretty shitty. They don't deserve any praise in this area at all. They have useful features but that doesn't mean their UX is good.
Well, UX means user experience. If some little features give you a better experience to me, a user, isn't that a better UX?
They both have regions. One makes it easier to see at a glance.
They both have the concept of reserved IP, one doesn't need to be set first.
They both install ssh keys for you. One does it per user, the other per instance.
One sets up cross region VPC for you. The other one makes you suffer and do it yourself.
They both have regions. One makes it easier to see at a glance.
They both have the concept of reserved IP, one doesn't need to be set first.
They both install ssh keys for you. One does it per user, the other per instance.
One sets up cross region VPC for you. The other one makes you suffer and do it yourself.
Yeah, you're right. That's definitely a better UX. But since OP was talking about GCP UI as a potential value differentiator, I was also focusing on that. Certainly something like an easy VPC setup improves the overall experience within the platform.
But I was referring to things like their documentation, the way they organize resources inside the Web Console and the confusing paths to different functionality within their UI.
But I was referring to things like their documentation, the way they organize resources inside the Web Console and the confusing paths to different functionality within their UI.
Making it hard to cross regions is deliberate - I would guess it's a learning from s3 being designed as a global service. And I think if you compared global outages across cloud providers, you would see that strong region isolation has substantial benefits.
It seems like you're confusing UI and UX. My experience with either UI is almost nil, so I can't comment, but an ugly UI that streamlines common patterns and has sane and unsurprising defaults has good UX. As far as I know, you can accomplish all of the things GP mentioned with either AWS or GCP. Its just that doing so is much less confusing on GCP, hence better UX.
> But an ugly UI that streamlines common patterns and has sane and unsurprising defaults has good UX.
Yes. But that's not what I'm talking about (I'm a 9 to 5 designer so to keep my job I believe I need to have a strong enough foundation to not confuse UI and UX).
A product can be ugly but still functional. For example, HackerNews is kind of ugly but it has a decent UX. GCP sometimes has decent UIs with horrible UX or horrible UX with horrible UIs.
Of course, I'm speaking about web consoles. If we are going to talk about the whole developer experience (including the CLI, documentation, APIs, etc), I think it gets more complex than that. But as a user of both GCP and AWS, I think Google DX (developer experience) it's not great. Perhaps better in certain areas when compared to AWS, but not something that would deserve any praise.
Yes. But that's not what I'm talking about (I'm a 9 to 5 designer so to keep my job I believe I need to have a strong enough foundation to not confuse UI and UX).
A product can be ugly but still functional. For example, HackerNews is kind of ugly but it has a decent UX. GCP sometimes has decent UIs with horrible UX or horrible UX with horrible UIs.
Of course, I'm speaking about web consoles. If we are going to talk about the whole developer experience (including the CLI, documentation, APIs, etc), I think it gets more complex than that. But as a user of both GCP and AWS, I think Google DX (developer experience) it's not great. Perhaps better in certain areas when compared to AWS, but not something that would deserve any praise.
Perhaps there is a case once you learn AWS and GCP that they are similar in UX. But as a developer who doesn't typically deal with cloud deployments I found that setting up a GCP instance with all the security features (specifically network related) I want is significantly easier.
Maybe that isn't a good argument for a business to use GCP over AWS but it is an important point.
Maybe that isn't a good argument for a business to use GCP over AWS but it is an important point.
You fail to provide any evidence or even personal anectode to support any of your assertions.
You make claims, other fellow users counter your argument with objective statements, but you ignore everything and opt to double down on more baseless assertions. That is not helpful at all.
You make claims, other fellow users counter your argument with objective statements, but you ignore everything and opt to double down on more baseless assertions. That is not helpful at all.
I mean. I don't know what you want me to say. I'm not trying to prove that AWS UX is better than GCP or vice-versa. Perhaps GCP has features like the ones mentioned above that improve the whole developer experience, but that's not what I'm arguing here. I'm just trying to elevate the argument to another level and explain why all of them have horrible UX and it's not even worth it to compare them since the bar is so low.
I don't know what type of evidence you want me to provide. It is as simple as logging in to any of these major cloud providers' web consoles and come up with your own conclusions.
I don't know what type of evidence you want me to provide. It is as simple as logging in to any of these major cloud providers' web consoles and come up with your own conclusions.
What is bad about the UX when you log in, in your opinion?
- Navigation: A sidebar that doesn't scale with their growing offering. Dozens of services stacked in a scrollable sidebar.
- Hierarchy: A lack of hierarchy concepts and the overall feeling that everything is scattered around. No clear defined boundaries between entities. For example, they have something called API Library, which for some weird reason, seems to be the default path to enable things that are required in specific service consoles.
Also, the way they compartmentalize things. Why is there a section in the sidebar that reads "Products" and then there are other sections at the same hierarchy level like "Compute"..aren't the services under Compute products as well?
-Discoverability: Very poor discoverability across all services. For example, go down the path of enabling one of their flagship services like Google Vision. The expected path would be something like entering the console > going to the sidebar > Finding Vision > Enabling API. Does it work like that? Nope. There's only a link to the documentation that explains how to enable it.
- Visibility: Ok. Staying with the Vision example. Now I want to see my usage of this API. It would make sense to see this data inside that console. Is it there? Nope. You have to go back and start hunting down where to find this information. Apparently they expect you to know that this lives under the API console, but there's no way to know this especially if you used the CLI or one of the "Enable Buttons" within the documentation. Maybe they thought those were useful, but they just break the learnability of the platform.
I could keep going...but you get the idea. This is not usable. I don't blame them either, to be honest. Even Google and Amazon have limited resources and the UX is a low priority for them since the value proposition is coming from other areas (security, reliability, offering range, price, etc)... but I feel as this space matures this is gonna become an area where the legacy of their poor decisions will generate issues down the road.
- Hierarchy: A lack of hierarchy concepts and the overall feeling that everything is scattered around. No clear defined boundaries between entities. For example, they have something called API Library, which for some weird reason, seems to be the default path to enable things that are required in specific service consoles.
Also, the way they compartmentalize things. Why is there a section in the sidebar that reads "Products" and then there are other sections at the same hierarchy level like "Compute"..aren't the services under Compute products as well?
-Discoverability: Very poor discoverability across all services. For example, go down the path of enabling one of their flagship services like Google Vision. The expected path would be something like entering the console > going to the sidebar > Finding Vision > Enabling API. Does it work like that? Nope. There's only a link to the documentation that explains how to enable it.
- Visibility: Ok. Staying with the Vision example. Now I want to see my usage of this API. It would make sense to see this data inside that console. Is it there? Nope. You have to go back and start hunting down where to find this information. Apparently they expect you to know that this lives under the API console, but there's no way to know this especially if you used the CLI or one of the "Enable Buttons" within the documentation. Maybe they thought those were useful, but they just break the learnability of the platform.
I could keep going...but you get the idea. This is not usable. I don't blame them either, to be honest. Even Google and Amazon have limited resources and the UX is a low priority for them since the value proposition is coming from other areas (security, reliability, offering range, price, etc)... but I feel as this space matures this is gonna become an area where the legacy of their poor decisions will generate issues down the road.
You can pin items on the drawer to the top.
The search within console is fantastic for finding things quickly.
I have yet to find a platform that doesn't have some amount of learning curve.
The search within console is fantastic for finding things quickly.
I have yet to find a platform that doesn't have some amount of learning curve.
Completely agree. GCP is confusing as hell to navigate. I don't need some polished up pretty looking UI. I need to be able to access my resources quickly and move around the dashboard easily. Things are scattered everywhere in GCP.
My theory on this is that the web console isn’t actually the real UX for cloud providers - their API is the UX, and the web console is just a thing that they fling in at the end because everything is meant to have one
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There seems to be a common problem here, is it possible for a startup to come in and improve things.
Anecdotal story:
I was working on a personal project where I wanted to try a "server-less" setup and I found Google's firebase authentication pretty handy and when I was looking into Firestore I found these handy videos on Youtube that Google made that I thought were pretty good introductions ... and they even updated the videos here and there so they weren't up to date. I felt like I understood how things worked pretty quickly considering I was comming from SQL land.
I had previously been playing with AWS and tied a domain to some S3 stuff and some other things and holy crap it was pure frustration and I kept thinking using AWS that "There is nothing about how this works that I could possibly have guessed correctly without googling for a painfully long time... so if / when things go wrong how would I ever know how to fix it?"
Even when I found the "right" way to do things on AWS, just the setup felt wrong it was such a "click here click there now go back to ..." adventure.
I just felt unsure and had an uneasy feeling about AWS the entire time, even after I did it right...
Google Cloud I felt like they were trying to help me understand the complexity and once I completed the task I could do it again with limited difficulty. They also were providing services tied together for me already.
I was working on a personal project where I wanted to try a "server-less" setup and I found Google's firebase authentication pretty handy and when I was looking into Firestore I found these handy videos on Youtube that Google made that I thought were pretty good introductions ... and they even updated the videos here and there so they weren't up to date. I felt like I understood how things worked pretty quickly considering I was comming from SQL land.
I had previously been playing with AWS and tied a domain to some S3 stuff and some other things and holy crap it was pure frustration and I kept thinking using AWS that "There is nothing about how this works that I could possibly have guessed correctly without googling for a painfully long time... so if / when things go wrong how would I ever know how to fix it?"
Even when I found the "right" way to do things on AWS, just the setup felt wrong it was such a "click here click there now go back to ..." adventure.
I just felt unsure and had an uneasy feeling about AWS the entire time, even after I did it right...
Google Cloud I felt like they were trying to help me understand the complexity and once I completed the task I could do it again with limited difficulty. They also were providing services tied together for me already.
Have you tried aws cli though? The whole thing is 100x easire in the command line and the documentation is 1000x better. There's even help pages you can get as you type in help. aws s3 help basically list a bunch of option to deal with s3 and you could read through and do exactly what you want. Not saying that console are useless but AFAIK all possible action through console can be a command that's (probably easier).
I'll check it out for sure.
The thing that bothered me was that each entity, like S3, domain hosting, everything else I did felt like an island.
Google's version felt like a "solution" in terms of things being related documentation wise and everything else.
I fully admit that given a different situation I could feel differently about Google.
The thing that bothered me was that each entity, like S3, domain hosting, everything else I did felt like an island.
Google's version felt like a "solution" in terms of things being related documentation wise and everything else.
I fully admit that given a different situation I could feel differently about Google.
GCloud CLI is better in all these respects
Another thing that contributes to the mess of AWS UI is their docs. Probably a personal preference thing, but I don't like their cluttered UI for their docs either. Maybe if they had some developer advocates or pay websites/blogs to post about how to use all 300+ services of AWS (probably an exaggeration... but looking at their dropdown probably not) then it would be better for developers or even companies to come onboard a bit easier.
Actually I really like the AWS documentation, even more since they launched their public knowledge center [1], which offers answers for common use cases.
And AWS does have of course evangelists blogging about a lot of stuff. You should check out their blogs overview page [2] which lists 29 new posts since the beginning of October alone!
[1]: https://aws.amazon.com/premiumsupport/knowledge-center/
[2]: https://aws.amazon.com/blogs/
And AWS does have of course evangelists blogging about a lot of stuff. You should check out their blogs overview page [2] which lists 29 new posts since the beginning of October alone!
[1]: https://aws.amazon.com/premiumsupport/knowledge-center/
[2]: https://aws.amazon.com/blogs/
Amazon stuffs SEO with subpar docs, Google's are far superior. Just about every page has both CLI and web walk throughs. Many have SDK examples for multiple languages too
I find the GCP dashboard very confusing to navigate, and the material design does not help the information hierarchy one bit. I'd argue GCP is just as bad, if not worse, than AWS for beginners.
I'm already intimately familiar with the AWS dashboard. Just because GCP's dashboard has a bit more polish is not enough for me to switch. Even slightly lower prices may not be either.
I'm already intimately familiar with the AWS dashboard. Just because GCP's dashboard has a bit more polish is not enough for me to switch. Even slightly lower prices may not be either.
Agree with the docs part.
As I've explained in previous comments, can't really differentiate either AWS or GCP. But personally I'd say GCP is very slightly better; not sure exactly why, but probably due to the fact it's a bit more organized than AWS's dump that goes edge to edge with bad fonts.
I've always joked that the best argument for using infrastructure as code is you get to look at AWS's bad UI less
AWS isn't mentioned in the article at all... not sure why you're mentioning it. It's considered to have a similar valuation to Google Cloud though.
According to this, however, AWS seems like it should be valued considerably higher (and this is in line with my industry experience - AWS is used everywhere, Google Cloud is not): https://kinsta.com/blog/google-cloud-vs-aws/
According to this, however, AWS seems like it should be valued considerably higher (and this is in line with my industry experience - AWS is used everywhere, Google Cloud is not): https://kinsta.com/blog/google-cloud-vs-aws/
Is it really just the UI that's better designed in GCP compared to AWS? I find the "better designed" thing seems to apply to most aspects.
I don't really consider either having superior UI... but AWS's endless list of services when you click for the dropdown is a bit too much to handle. Not to mention how you'll have to use their search bar to get to what you want.
One thing I do credit them on is SSHing into an instance is a lot easier than GCP's "gcloud" way (I say this since I recently found the "gcloud" sdk to take over 10g on my laptop) and even if you use SSH on GCP, they make it considerably harder than AWS (although somewhat more secure for beginners... to prevent from attackers to getting to port 22).
One thing I do credit them on is SSHing into an instance is a lot easier than GCP's "gcloud" way (I say this since I recently found the "gcloud" sdk to take over 10g on my laptop) and even if you use SSH on GCP, they make it considerably harder than AWS (although somewhat more secure for beginners... to prevent from attackers to getting to port 22).
You don't need to use gcloud to ssh. Just add your keys in your projects' Metadata, and you'll have ssh access to all servers.
Each member of your team can do it, and it works retroactively.
Each member of your team can do it, and it works retroactively.
Yeah that does work (which I have managed to pull off)... but I feel like it's a bit more of a pain (very slightly) to change the metadata, open up the ports and whatnot to ssh. I think AWS just tells you to download a .pem file and ssh.
In conclusion, I guess both ways aren't bad. I just seem to prefer AWS here because for me it was a bit easier than GCP because I ran into several problems when sshing to GCP initially.
In conclusion, I guess both ways aren't bad. I just seem to prefer AWS here because for me it was a bit easier than GCP because I ran into several problems when sshing to GCP initially.
So it was easier for you to use AWS initially because you were used to AWS. Gotcha. ;)
The entire experience is much better, can you log into a EC2 instance that has no public IP with a simple CLI command that has no IP address or ssh keys to supply?
I never have any luck figuring out how to do most things in GCP. The disjointed UIs, the documentation that is out of date, etc leave me just going back to AWS.
I had such a different experience when I was trying out the two platforms in parallel about fours years ago.
I came from a background where we'd created/ran all of these kinds of services in-house - simply because we started building our stuff before AWS/GCP existed in any meaningful way.
Anyway, after switching employers four years ago I had a greenfield project. I had zero investment in either platform. (I had joined a hardware company with a responsibility to build the software org. Side note: don't do that. I now understand why hardware-centric companies often can't do software - the CEO and other key people in sales/marketing simply don't understand the field at all. And that does matter. They won't even be able to understand if you're doing a good or bad job.)
My impressions were:
1) AWS had many more services than GCP
2) GCP services were generally designed better, more carefully thought out, etc. I felt that AWS APIs were designed without a very large amount of thought put into it, on an individual basis. I imagined Werner Vogels laying out edicts for a generalized service API design, and the individual teams all had to follow them, or else. And then the individual team built each service, without being able to change the general API design guidelines.
GCP services meanwhile seemed they like they were built by a smaller (and more talented) team with more team cohesion and communication. They traded a better design for a slower API/service output over time.
3) GCP was cheaper.
I came from a background where we'd created/ran all of these kinds of services in-house - simply because we started building our stuff before AWS/GCP existed in any meaningful way.
Anyway, after switching employers four years ago I had a greenfield project. I had zero investment in either platform. (I had joined a hardware company with a responsibility to build the software org. Side note: don't do that. I now understand why hardware-centric companies often can't do software - the CEO and other key people in sales/marketing simply don't understand the field at all. And that does matter. They won't even be able to understand if you're doing a good or bad job.)
My impressions were:
1) AWS had many more services than GCP
2) GCP services were generally designed better, more carefully thought out, etc. I felt that AWS APIs were designed without a very large amount of thought put into it, on an individual basis. I imagined Werner Vogels laying out edicts for a generalized service API design, and the individual teams all had to follow them, or else. And then the individual team built each service, without being able to change the general API design guidelines.
GCP services meanwhile seemed they like they were built by a smaller (and more talented) team with more team cohesion and communication. They traded a better design for a slower API/service output over time.
3) GCP was cheaper.
Expanding on this:
* GCP gave me the feeling it was designed with taste, through every layer. Comparing this to the desktop platform fight; think Apple. Quality over volume.
* AWS gave me the feeling it was designed without taste. Think Microsoft. Volume over quality.
I'm talking about the combination of service design criteria, APIs, documentation, etc.
Another way of thinking about it: GCP is clearly designed by hackers schooled in the ways of UNIX over a very long time. Simplicity and elegance is valued very highly in terms of designs. For AWS: Simplicity is clearly not a design goal.
* GCP gave me the feeling it was designed with taste, through every layer. Comparing this to the desktop platform fight; think Apple. Quality over volume.
* AWS gave me the feeling it was designed without taste. Think Microsoft. Volume over quality.
I'm talking about the combination of service design criteria, APIs, documentation, etc.
Another way of thinking about it: GCP is clearly designed by hackers schooled in the ways of UNIX over a very long time. Simplicity and elegance is valued very highly in terms of designs. For AWS: Simplicity is clearly not a design goal.
I've tried to use several different gcp services. I am forced to use their UI for setting up google play services and the documentation never matches the UI. Their pubsub services, when I tried to use them had broken documentation. It just feels cobbled together everytime I dip back into it.
this. pretty UI but disjointed documentation. it's quite up to date (for what i do though) but
it's hard to get the whole picture.
UI is not that bad, but the product is very complicated for startups. For example, I can create a website on Azure with just a few clicks as a single item in my account. On AWS, (even if I use Beanstalk) I have to create VPC, load balancer, security groups, S3 bucket for code and a lot of other things... not easy to manage and takes a lot of time!
Setting things up in AWS is time consuming, but not as time consuming as debugging.The AWS documentation is huge and seems thorough, and yet never actually helps me solve any problems. There is always some obscure bit of configuration not covered in the tutorials and buried too deep in the docs to find that is needed to get anything past a hello world to work. Meanwhile, the errors in the log are too vague to make the solution googleable, and it takes days to figure out even the simplest things.
I've found the only way to make anything work in AWS is to search for hours and hours looking for the Stack Overflow question that tells you what the docs left out. And yet I stick with AWS because last time I tried Azure everything was broken. It'll be nice when this stuff gets a little more polished.
I've found the only way to make anything work in AWS is to search for hours and hours looking for the Stack Overflow question that tells you what the docs left out. And yet I stick with AWS because last time I tried Azure everything was broken. It'll be nice when this stuff gets a little more polished.
When was the last time you tried Azure?
Unfortunately, this is an opinion by a single analyst. Analysts are frequently wrong about their prediction. I would not put a whole lot of stock in it. Post Kurian, GCP has shown _some_ traction but it still has a long catch up game to play. Google really needs to capitalize on its strengths (ML/AI, BigData) in a major way. In addition it has to spend a major chunk of money in educating first-time developers and making it super easy to migrate into the Google ecosystem. We haven't seen major movement in these directions from GCP, yet. Hope they're coming soon.
Disclaimer: I am long GOOGL.
Disclaimer: I am long GOOGL.
its also Deutsche Bank one of the most reckless banks around.
Reckless? Loaning hundreds of million to the same people that just refused to pay you back the last few hundred you lent them, after they refused to pay back other backs before that, is the investment strategy of the future! /s
Incredible. They don't even mention Amazon.
Kind of telling how the chart has Oracle, Adobe and Intel as "peers" but AWS is nowhere to be seen. I didn't even know Intel or Adobe had cloud offerings.
The chart shows the entire market value of select other tech Giants, not their cloud offerings.
The purpose of the graphic was to say "Google Cloud is now worth more than all of Oracle", not to show Google's place in the cloud market relative to Amazon and Microsoft.
The purpose of the graphic was to say "Google Cloud is now worth more than all of Oracle", not to show Google's place in the cloud market relative to Amazon and Microsoft.
You can't say tech giant without mentioning Amazon or Microsoft.
> I didn't even know Intel or Adobe had cloud offerings.
Google includes their SaaS offerings as part of Google Cloud (like Gmail and Docs). Intel and Adobe have SaaS offerings.
They're comparing Gmail to hosted Photoshop basically.
Google includes their SaaS offerings as part of Google Cloud (like Gmail and Docs). Intel and Adobe have SaaS offerings.
They're comparing Gmail to hosted Photoshop basically.
G Suite for businesses, not all of Gmail.
Adobe's market cap has gone from a stagnant $20-$30x billion, to being as valuable as SAP, in five years, solely due to their booming cloud subscription business. Previously the stock hadn't net climbed higher basically between the dotcom bubble in 2000 and 2013.
Here is their chart back to 1986:
https://i.imgur.com/lVeAGHQ.jpg
Sales were hardly moving for years and have soared since fiscal 2015, from $4.7b to $10.6b (last four quarters). In that time operating income more than tripled from $900m to $3b.
Here is their chart back to 1986:
https://i.imgur.com/lVeAGHQ.jpg
Sales were hardly moving for years and have soared since fiscal 2015, from $4.7b to $10.6b (last four quarters). In that time operating income more than tripled from $900m to $3b.
And for Adobe, cloud is way more than just Creative Cloud and the subscriptions for Photoshop or whatever.
When Adobe bought Omniture, that was I would argue, one of the best acquisitions since DoubleClick, and Adobe has taken that and built out this very high-margin, very lucrative “marketing cloud” business for agencies and small businesses and large enterprises.
It’s genuinely impressive and brilliant to see how Adobe has turned its business around.
And as an end-user, I may dislike that it’s harder to pirate Photoshop (and if we’re legit honest, that’s what 95% of the complaints about Creative Cloud’s pricing comes down to), but if you’re a creative professional who relies on those tools, $600 a year is a worthwhile investment, especially since the updates have been higher quality and more frequent. My employer pays my sub but I’d pay it myself if I had to — just because it makes my life easier — and I’m not even a designer or video editor by trade (I do edit a lot of video, however).
When Adobe bought Omniture, that was I would argue, one of the best acquisitions since DoubleClick, and Adobe has taken that and built out this very high-margin, very lucrative “marketing cloud” business for agencies and small businesses and large enterprises.
It’s genuinely impressive and brilliant to see how Adobe has turned its business around.
And as an end-user, I may dislike that it’s harder to pirate Photoshop (and if we’re legit honest, that’s what 95% of the complaints about Creative Cloud’s pricing comes down to), but if you’re a creative professional who relies on those tools, $600 a year is a worthwhile investment, especially since the updates have been higher quality and more frequent. My employer pays my sub but I’d pay it myself if I had to — just because it makes my life easier — and I’m not even a designer or video editor by trade (I do edit a lot of video, however).
AWS are just developer tools and hosting, right? Google Cloud includes both GCP and gsuite, so it is more like Microsoft office 365 combined with Microsoft Azure.
AWS are trying to get into that game. They now have hosted email, documents, file sharing, customer support, and corporate voip products. No doubt more are lined up.
For now. The next logical extension of AWS, as they saturate the tools / hosting aspect, is to begin eating the ecosystem of software businesses that depend on them. They'll tread carefully and will do it non-the-less.
It's the same thing every platform or large service ends up attempting. From Reddit to Twitter to Google to Microsoft & Windows and so on.
Amazon understands that well, they're aggressively doing it in retail. It's guaranteed they will do it with AWS. As its growth rate slows, they'll accelerate that cannibalize-your-customers (CaaS, or CYCaaS) as the next growth opportunity.
Generic CRM, targeting Salesforce and Oracle. Etc. Amazon will view these types of offerings as just another block of software service on top of their AWS structure. The playbook is that Oracle's margin is their opportunity and it doesn't stop at databases.
It's the same thing every platform or large service ends up attempting. From Reddit to Twitter to Google to Microsoft & Windows and so on.
Amazon understands that well, they're aggressively doing it in retail. It's guaranteed they will do it with AWS. As its growth rate slows, they'll accelerate that cannibalize-your-customers (CaaS, or CYCaaS) as the next growth opportunity.
Generic CRM, targeting Salesforce and Oracle. Etc. Amazon will view these types of offerings as just another block of software service on top of their AWS structure. The playbook is that Oracle's margin is their opportunity and it doesn't stop at databases.
Working as a consultant in Europe.
Almost every business i walk in to has "something" in Azure (AD/SSO/Compute). 50-70% have "something" in AWS. Honestly under 10-15% have Google cloud products.
I work in the ERP segment so i like to think i experience a wide range of companies / cultures / budgets.
Almost every business i walk in to has "something" in Azure (AD/SSO/Compute). 50-70% have "something" in AWS. Honestly under 10-15% have Google cloud products.
I work in the ERP segment so i like to think i experience a wide range of companies / cultures / budgets.
"The unit could report compound annual growth of 55% between 2018 and 2022, and reach annual sales of about $38 billion by 2025, the analysts wrote."
I'm curious how they're making basing these predictions since Google Cloud revenues aren't currently reported.
I'm curious how they're making basing these predictions since Google Cloud revenues aren't currently reported.
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So my realization after the years have been these:
* Cloud margin is very high, using IBM Orale and so on, aka the "old guards" (as said by Andy Jassy: my favorite tech executive by a big margin, got to mention this as a fan boy), as the comparison.
* Cloud is the foundation of the next generation of developer platform, being irrelevant in this market is detrimental to Google. Although that was not as obvious to Google as Browser. But the metaphor is obvious now.
* Cloud is enterprise oriented, an area that both Amazon and Google were vastly behind Microsoft at 2006. Microsoft then already had a top-tier relationship with enterprise customers. Amazon was way earlier in realizing that, but Google was at least maybe 5 years behind. Diane Green's joining symbolizes the inception of the changing perception, but I'd say Diane's execution is poor (Dianne seems very distracted to me, during their time in Google).
* Cloud margin is very high, using IBM Orale and so on, aka the "old guards" (as said by Andy Jassy: my favorite tech executive by a big margin, got to mention this as a fan boy), as the comparison.
* Cloud is the foundation of the next generation of developer platform, being irrelevant in this market is detrimental to Google. Although that was not as obvious to Google as Browser. But the metaphor is obvious now.
* Cloud is enterprise oriented, an area that both Amazon and Google were vastly behind Microsoft at 2006. Microsoft then already had a top-tier relationship with enterprise customers. Amazon was way earlier in realizing that, but Google was at least maybe 5 years behind. Diane Green's joining symbolizes the inception of the changing perception, but I'd say Diane's execution is poor (Dianne seems very distracted to me, during their time in Google).
And WeWork is worth 40B according to the big banks.
Softbank != "the big banks"
The public markets did what they were supposed to do to WeWork.
The public markets did what they were supposed to do to WeWork.
Goldman Sachs = the big banks
IIRC Goldman valued WeWork at $60B
IIRC Goldman valued WeWork at $60B
Goldman valued WeWork at $60B, as part of their sales pitch to lead the IPO. The context makes all the difference since the point of that valuation was to aid a sales pitch, not be an accurate assessment.
This is incorrect. They pitched this at $60b but couldn't get a bookbuild at that price which never happens.
The key distinction with pitching to lead to the IPO is they sought to find investors (as opposed to wework management) at this price too, but not enough people bit to fill the raise.
The key distinction with pitching to lead to the IPO is they sought to find investors (as opposed to wework management) at this price too, but not enough people bit to fill the raise.
Softbank and WeWork reminds me painfully of the episode of Entourage I watched last night, where the boys are pitching their as-yet unseen prestige film at Cannes. Hyped to the extreme, on the verge of pulling a deal to make a boatload of money, but on closer inspection it's a huge stinker that falls apart disastrously.
To be fair it was the weWork ipo roadshow banks that came up with that fantastic number
Matt Levine made the point that to get chosen as one of the IPO banks, you had to pitch to WeWork that you could get them a good-yet-plausible valuation. I.e., take what their last (private) valuation was, and bump it up by a decent amount. Once you're selected, of course, then reality can take over.
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two weeks later they said it's only worth ~ 10B
How much are AWS and Azure worth?
More. A lot more. Azure is growing 20 points faster than GCP and from a much higher base too (and I will point out that it is in Microsoft's DNA to run this sort of business, unlike Google's).
How is it in Microsoft's DNA? They've always run the software, not the hardware. And for Azure, they just took all their Office customers and rebranded them as "Azure" customers, pumping their cloud numbers.
I think the point was that Microsoft has typically been very present in "enterprise" - lots of sales people in lots of industries with lots of connections and lots of experience making the sales and doing the deals. Google less so.
The hardware is just the hidden infrastructure that businesses don't really care about as long as it meets the SLAs, like I don't care about what the physical building materials are when I go and buy groceries or get my hair cut so long as the building meets it's SLAs (which for a building is I guess not falling down when I am inside it etc) I just want the service.
The hardware is just the hidden infrastructure that businesses don't really care about as long as it meets the SLAs, like I don't care about what the physical building materials are when I go and buy groceries or get my hair cut so long as the building meets it's SLAs (which for a building is I guess not falling down when I am inside it etc) I just want the service.
That's fair. Their sales team and the relationships they had made over the years is definitely a huge part of their success transitioning.
Enterprise Sales, Support, Training, Certifications, Deals for packing services/software/etc, Incentive programs, Extensive partner network, etc, etc, etc.
There's an entire realm of software development and consulting in and around Microsoft enterprise products - and that has extended to Azure as well.
Personally, I've worked with AWS,GCP and Azure in a professional capacity (data science consulting) - and while Azure has its fair share of warts, the level of integration and "it just works" between Azure and MS Enterprise products is fairly impressive.
For example, I'm big on postgres - but working with SQL Server on Azure is such as breeze. There's nothing I can do with it that I couldn't do on other platforms, but the combination of tooling (SSMS, VSCode) and smooth azure integration (Blob Storage, AzureSQL, Logic Apps, Azure Functions, etc) made it easy to make things that 1. worked and 2. could be mostly supported by a BA instead of a dev.
There's an entire realm of software development and consulting in and around Microsoft enterprise products - and that has extended to Azure as well.
Personally, I've worked with AWS,GCP and Azure in a professional capacity (data science consulting) - and while Azure has its fair share of warts, the level of integration and "it just works" between Azure and MS Enterprise products is fairly impressive.
For example, I'm big on postgres - but working with SQL Server on Azure is such as breeze. There's nothing I can do with it that I couldn't do on other platforms, but the combination of tooling (SSMS, VSCode) and smooth azure integration (Blob Storage, AzureSQL, Logic Apps, Azure Functions, etc) made it easy to make things that 1. worked and 2. could be mostly supported by a BA instead of a dev.
One of my favorite resources is https://docs.microsoft.com/en-us/azure/architecture/
It's a rich set of articles about various system design patterns. It's not even really set in the context of Azure, it's just plain "Here are things you should learn about". It's really well done.
I haven't seen anything close from Google or Amazon.
It's a rich set of articles about various system design patterns. It's not even really set in the context of Azure, it's just plain "Here are things you should learn about". It's really well done.
I haven't seen anything close from Google or Amazon.
That certainly covers operations in AWS, but take a look at the azure docs for cloud design patterns: https://docs.microsoft.com/en-us/azure/architecture/patterns...
For example, read Bulkhead, Circuit-Breaker, Queue-based load leveling, sharding. The level of detail around why you might want to do it this way is fantastic. AWS whitepapers and best practices never really get into the why, they just focus on the what.
For example, read Bulkhead, Circuit-Breaker, Queue-based load leveling, sharding. The level of detail around why you might want to do it this way is fantastic. AWS whitepapers and best practices never really get into the why, they just focus on the what.
They know how to sell to old stodgy Fortune 500's.
Google is excruciatingly awkward in the room with that group. Amazon is in the middle.
Google is excruciatingly awkward in the room with that group. Amazon is in the middle.
I'm a Satya naysayer as much as any Windows Phone victim, but Office 365 is not part of the "Intelligent Cloud" unit that Azure earnings are reported in.
Since when is the internet in Microsoft's DNA?
And isn't Azure's main feature the fact that they provide a service invented and developed by Google (kubernetes') and a first-class citizen in GCP?
And isn't Azure's main feature the fact that they provide a service invented and developed by Google (kubernetes') and a first-class citizen in GCP?
Microsoft's DNA is Enterprise with a capital E. Google has always had the startup pretense (or rather, the pretense of still being a startup, even when they're not by any stretch of the imagination), meanwhile in almost every Fortune 500 company you'll see offices full of Windows desktops running Office. The sales networks are there, and they can reuse them for Office 365 and Azure too.
Let me get this straight.
Wasn't Waymo valued at $210Bn like 5 months ago? Cloud is $225Bn. Google has $117Bn in cash. It's total market cap is $839Bn. That means the rest of Google is worth $287Bn. Really?
Wasn't Waymo valued at $210Bn like 5 months ago? Cloud is $225Bn. Google has $117Bn in cash. It's total market cap is $839Bn. That means the rest of Google is worth $287Bn. Really?
I am interested to know the valuation of AWS. If the values are apart then it makes sense that AWS was ahead of teh game. If GCP has caught up then that would be blazing-fast improvement.
From Bloomberg re GCP: "The unit could report compound annual growth of 55% between 2018 and 2022, and reach annual sales of about $38 billion by 2025"
AWS q2 2019 was was 8.4 billion so AWS in 2019 is near where GCP is projected to be in 2025. AWS q1 to q2 growth was 37%, so much slower growth than Azure and GCP.
From Barrons earlier this year: "He sees AWS revenues of $36.1 billion this year, growing about 31% a year to $140 billion in 2024. He ... estimates the value of AWS alone as $506 billion."
https://www.barrons.com/articles/amazon-stock-web-services-w...
AWS q2 2019 was was 8.4 billion so AWS in 2019 is near where GCP is projected to be in 2025. AWS q1 to q2 growth was 37%, so much slower growth than Azure and GCP.
From Barrons earlier this year: "He sees AWS revenues of $36.1 billion this year, growing about 31% a year to $140 billion in 2024. He ... estimates the value of AWS alone as $506 billion."
https://www.barrons.com/articles/amazon-stock-web-services-w...
AWS is probably worth more than Amazon retail. Amazon Retail is a low margin very competitive business.
Amazon is under valued.
Or everyone is overvalued and these are fantasy numbers pulled from the unicorn forest. There is no repercussion when an analysts predictions are "overly optimistic" (see: everyone pitching $50B-$100B valuations to WeWork to get their IPO biz).
Throwing darts would be just as accurate as the predictions investment banks are throwing out.
Throwing darts would be just as accurate as the predictions investment banks are throwing out.
Well, AWS actually is highly profitable and changed the game so most of the recent startups could actually be built. I wouldn't associate WeWork with it. I won't even associate Tesla with WeWork. At least if you give $10B to Musk, you get rocket ships and category-leading car companies out of it.
AWS is only highly profitable for an investor if you cut it loose from Amazon retail so it's not subsidizing it (spin it out) and other Amazon endeavors that aren't profitable. Otherwise, it's only of benefit to Amazon proper.
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And yet I still don't trust Google not to "sunset" services on a whim (despite being an almost $1 trillion business) so I'd rather stick with AWS.
How much are their shares of SpaceX worth?
GCP I'd say could worth definitely tens of billions, but not hundreds.
The thing that has confused most of the commenters here is that Google Cloud contains both GCP, which is a dumpster fire, and GSuite, which is probably very profitable.
If only Google could say the same about their investment in MapR.
I do not want to sound like a nay sayer but which responsible enterprise CIO would put their stack on Google Cloud. They have a well deserved reputation for being unresponsive and opaque and downright irresponsible with their customers' infrastructure.
Not that I want to defend Google or anything, but there are some impressive customers here [1]
[1] https://cloud.google.com/customers
[1] https://cloud.google.com/customers
That list is probably the exact list of google customers that get any real support from google
Anyone can get Google support with Google One [0] for as low as 2$ a month (along side 100GB of storage).
The issue is people expect free products they haven't paid a penny for to have live customer support, which doesn't make much sense at the billion user scale.
[0] https://one.google.com/
The issue is people expect free products they haven't paid a penny for to have live customer support, which doesn't make much sense at the billion user scale.
[0] https://one.google.com/
Have you ever interacted with Google support as a paying customer?
It's miserable in my experience.
It's miserable in my experience.
Anecdote on the other side - Small customer (~5k/mo google cloud / firebase spend). They're support has been decent. Sub 24hr email response and technically competent enough to quickly escalate. It was comparable to AWS basic support.
Usually, it's a case of "You get what you pay for".
For GCP, you can get 4-hour response time SLA for $100 per user. If you want 1-hour response SLA it's $250. Then there's Enterprise Support if you need 15-minute response SLA, TAM assigned etc which costs more.
Caveat: I work at Google Cloud.
For GCP, you can get 4-hour response time SLA for $100 per user. If you want 1-hour response SLA it's $250. Then there's Enterprise Support if you need 15-minute response SLA, TAM assigned etc which costs more.
Caveat: I work at Google Cloud.
I have as a Fi and as a One customer, and both services had very good customer support. In the half a dozen time I've contacted them, I got someone helping me within a minute and my issue resolved in under 15. That's a normal Google customer though, I can't speak about Cloud, which is an entirely different beast.
As an enterprise customer using Google Cloud, yes, and so far its been very good.
In my experience their customer support is poor even if you are a paying customer. It's cultural and it goes right to the top, they don't like interacting with people.
At some point the discounts offered to use the platform are too good to pass up. Doesn’t mean the support is good.
This HN thread was interesting to say the least
https://news.ycombinator.com/item?id=17431609
https://news.ycombinator.com/item?id=17431609
How they're using GCP probably varies a ton. A lot of places are doing multi-cloud for risk mitigation. Maybe some are using it for Kubernetes workloads that they can spread across public/private clouds. Probably a lot like the PaaS products like Firebase for prototyping. I haven't seen any shops that have bet the farm on GCP the way they do on AWS or Azure.
> I haven't seen any shops that have bet the farm on GCP the way they do on AWS or Azure.
Your examples sound a bit biased. Based on your argument, using GCP as part of a multi-cloud solution for risk mitigation could also imply that those clients don't trust AWS or Assure to provide a reliable service, thus they are compelled to use GCP for reliability. Using Kubernetes workloads means that GCP is trusted above any other competing offer to provide a fundamental service. Using GCP's PaaS offers means that GCP is able to better fulfill the client's needs with their enticing higher-level services. Your hypothetical claims ring as true as there statements, but your bias points in a different direction.
Your examples sound a bit biased. Based on your argument, using GCP as part of a multi-cloud solution for risk mitigation could also imply that those clients don't trust AWS or Assure to provide a reliable service, thus they are compelled to use GCP for reliability. Using Kubernetes workloads means that GCP is trusted above any other competing offer to provide a fundamental service. Using GCP's PaaS offers means that GCP is able to better fulfill the client's needs with their enticing higher-level services. Your hypothetical claims ring as true as there statements, but your bias points in a different direction.
You work for Google or something? I've been in an out of a ton of IT departments and I'm just reporting what I've seen. I've honestly never done a real evaluation of GCP as a whole. Only Firebase. From what I've seen first-hand, AWS is the default choice. Azure has substantial market share, particularly among orgs that are already bought into the Microsoft stack. GCP just doesn't have a strong story to tell. I should also say that I pretty commonly see senior IT decision makers just make arbitrary decisions.
> You work for Google or something? I've been in an out of a ton of IT departments and I'm just reporting what I've seen.
I don't work for google, nor does your attempt to switch to personal attacks change any of the points I made. In fact not only do your assertions sound heavily biased, you now admit that you never done a real evaluation of a service you're criticising. Frankly I don't care if X or Y has more market share, but people making baseless assertions regarding stuff they have no experience or knowledge in simply add noise to a discussion that's expected to be insightful.
I don't work for google, nor does your attempt to switch to personal attacks change any of the points I made. In fact not only do your assertions sound heavily biased, you now admit that you never done a real evaluation of a service you're criticising. Frankly I don't care if X or Y has more market share, but people making baseless assertions regarding stuff they have no experience or knowledge in simply add noise to a discussion that's expected to be insightful.
I didn't say anything about GCP's quality and I don't know why you think I'm demeaning it. I'm just saying I have not seen any IT org that was heavily invested. I have seen a bunch using this or that feature (Firebase or AI/ML services) enough to be mentioned as a client but none that use it as their primary infrastructure. My point being that just because they have an impressive list of clients doesn't mean they're winning anything. And winning is not necessarily correlated to the quality of their product.
Enterprise CIOs get an entirely different experience from Google than you or I do. It’s like the difference between flying Concorde and flying as a stowaway in the nose wheel landing gear.
If that's the case I absolutely hate to know what is the experience that you have.
Google is absolutely clueless in sales to enterprise. The only thing that they throw at enterprise is CAF and everyone has CAF, it is just called something else.
Google is absolutely clueless in sales to enterprise. The only thing that they throw at enterprise is CAF and everyone has CAF, it is just called something else.
What is CAF? My relationship with Google is basically like my relationship with Mount Everest. It exists and I spent about $10,000 with it but never got a response from it on anything.
Customer Acquisition Fund -- Google will spend its money to solve your problems using Google infrastructure if you spend the money on the Google infrastructure so you become a customer.
I wouldn't say the Google strategy was wrong per se - their stock has about 10x'd since then. But it's interesting to see how much things change over time.