Amazon.com, Inc. (NASDAQ:AMZN) is leading in the cloud computing segment and investing more in the industry “could prove to be huge” for the company according to veteran analyst Bill Miller, but don’t count out Alphabet Inc (NASDAQ:GOOGL) just yet. The search engine giant sealed a significant deal that could take it one step closer to market domination: Google just won Evernote as a customer.
According to a report, Google has won the contract against other bidders, which many believe include Amazon Web Services. Before coming to Google’s cloud, Evernote had its own servers in its own data center. The win is significant for Google because the cross-platform app has over 200 million users. Evernote is reportedly keeping billions of notes and approximately 5 billion attachments, all of which could be useful to the Mountain View, California-based company.
Google’s win goes against the usual model of managing a business, which starts in the cloud and then maintaining a data center once the business grows bigger. According to Diane Greene, Google’s head of cloud computing, more companies will start following Evernote’s lead.
Amazon was the first to see the changes happening, with the growing number of companies going completely on its cloud and shutting down their data centers. Greene said that Intuit Inc (NASDAQ:INTU), a company where she is a board member, has gone in the same direction.
Winning Evernote is the first victory for Google’s push to turn to the cloud. “You just couldn’t begin to do what we do in our data centers with our scale. We spent $10 billion in capex last year,” Greene says. She explained that Google makes the perfect partner for Evernote because the former can offer better security. Greene says Google has over 650 full-time security experts.
Google’s cloud computing services are the most affordable in the market. Because of the very low price tag on its cloud services, naysayers believe that Google is more interested in increasing the number of its customers rather than generate more revenues and profits from cloud deals. Meanwhile, Evernote has been focused on cutting costs.
But Greene said Google won the contract because it has a lot of benefits to offer Evernote. Speaking at the Disrupt tech conference in San Francisco on Tuesday, Greene said, “They’ll be able to innovate faster, partnered with us innovating on the backend for them.” And this, Greene said, is Google’s main strategy for dominating the cloud segment and surpass Amazon, which earns the top spot in the cloud industry.
Google believes that it can develop cloud computing into an even larger industry than its internet ad business. As for naysayers, Greene has this to say: “I think it’s how we partner with customers. Engineer to engineer. Good engineer to good engineer.” This means, apart from selling products to companies, Google is also providing access to the company’s pool of talented engineers.
Google is notorious for hiring only the best, brightest, and most talented engineers in the business and this, Greene said, is one thing that its rivals cannot offer.
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