Don’t be fooled into thinking Google Cloud wants to compete on infrastructure alone

It’s no secret that Google Cloud is playing catch-up with AWS and Azure in the cloud wars. It has spent the last two years aggressively investing in infrastructure ($47bn+), now boasting 19 cloud regions across 14 countries. However, what’s becoming clear at the Google Cloud Next conference in San Francisco this week, is that the company has its sights set much higher than competing with AWS and Azure on infrastructure. It is (smartly, in my opinion) differentiating by thinking about the value it can add much higher up the stack - hoping to appeal more to the C-suite than developers.

Why is this smart? Because Google Cloud - or, I should talk Google more generally here, - is one of the largest data companies in the world. Data is about value, not about cheap tin. It recognises that if it has the infrastructure in place, upon which it can build neural networks, then it can create a gravitational pull for companies in industries that it can offer expertise in the form of AI/ML tools.

Google knows and understands how to use data at enterprise scale, which is why it makes sense to go to market with that expertise.

As an aside, new CEO Thomas Kurian, who previously spent over two decades with Oracle, is clearly bringing his enterprise experience with him to the company. And he may find himself competing with his ex-colleagues, rather than AWS or Azure, if what I heard today is anything to go by. His opening keynote at the conference was clearly aimed at appealing to digital change managers in the C-Suite, rather than developers looking for new tools (although there was some of that too).

Kurian laid out Google Cloud’s vision going forward as being separated into three parts:

• Providing customers with global scale, distributed infrastructure
• Enabling this with a digital transformation platform that helps people build “innovative digital transformation solutions” (data management, analytics, AI/ML, collaboration)
• Providing industry specific capability across a number of key verticals e.g. healthcare, finance, retail, media.

During his keynote, Kurian referred to Google Cloud as a “digital transformation provider” - he didn’t say an ‘IaaS alternative to AWS and Azure’. In fact, Google Cloud is open to the fact that enterprises may use multiple IaaS providers (more on that later). Kurian is clearly making a play for Google Cloud to become an enterprise technology vendor that has deep skin in the game with customers, focused on meaningful outcomes, rather than just a pay per usage alternative to other IaaS vendors.

Kurian also said that he wants to make it easier for enterprises to do deals with Google Cloud. He said:

“Our work in these industries would not be complete if we didn’t build enterprise capability. We at Google Cloud want to be the best strategic partner for organisations choosing their digital transformation journey. And we believe that we can do that in two important ways.

“The first way is bringing expertise to help you on that journey. The second is to be the easiest cloud provider to do business with. To help you on that journey, we are massively expanding our go to market organisation. Not just with sales people, but technical specialists that deeply understand technology and industries and can help you in your customer success role to build great new transformational opportunities using our technology foundation.

“To make it easy for our customers to do business with us, we are introducing a variety of new things - simplified pricing, easier contracting, co-innovation frameworks, and we are broadening our partner reach.”

The news

There were a number of news announcements this morning that play into Kurian’s ambitions. Firstly, and probably most importantly, Google Cloud announced the general availability of Anthos - a new platform for managing applications for multi-cloud.

What does that look like? Essentially Anthos is a service that allows customers to run an app anywhere - either on premise or in the cloud of your choosing (AWS was used as an example on stage). It also allows customers to manage Kubernetes workloads running on third party clouds.

Google Cloud is adopting open standards to help simplify the complexity that enterprises face in their multi-cloud environments. Anthos gives them a single view of all their workloads and allows them to be managed across multiple clouds or on premise, not just Google Cloud. See what I mean about aiming higher up the stack and bringing value? Google Cloud is looking to solve a complex problem for enterprise cloud buyers and be the overarching wrap around for their deployments.

Commenting on the announcement, Kurian said:

“It came from our listening to customers who wanted three important things from their cloud providers. First, the ability to have a technology stack that they could run in their data centre, next to their enterprise workloads that they couldn’t yet move to the cloud. Hybrid cloud.

“Second, a single programming model that gave them the choice and flexibility to move workloads to both Google Cloud, as well as other cloud providers without any change. And third, a platform that allows them to operate this infrastructure without complexity and to secure and manage across multiple clouds, in a single, consistent way.”

The other significant announcement out today was around Google Cloud entering strategic partnerships with leading open source companies in the area of data management and analytics - including MongoDB, Reid’s Labs, DataStax, Neo4j, Confluent and InfluxData.

Essentially, this is aimed at bringing open source and cloud closer together through tight integrations and serving it to enterprise buyers in a neat package, which includes things such as unified billing and support. Again, Google Cloud is recognising that customers want choice and flexibility, but want the ease of a traditional enterprise model. The open source vendors that spoke today also indicated that this will boost their investment in Google Cloud functionality and features. Equally, Google Cloud is likely to benefit from a network effect of these vendors going to market and promoting its platform.

Industry verticals

Another point worth reiterating, which plays into Google Cloud’s focus on business outcomes, rather than cheap and scalable infrastructure, is Kurian’s ambition to deliver industry vertical solutions to companies. We are expecting more on this tomorrow, but I know that this will largely focus on Google Cloud’s AI/ML expertise. Two industries that Kurian highlighted today include packaged AI solutions for healthcare and for media.

Again, this highlights Kurian’s desire to create stickiness with C-suite execs that are focused on both the bottom line and customer experience. During the keynote Kurian said:

“We at Google Cloud have a very clear vision on what we want to offer customers in a number of industries, who are going through digital transformation. We want to give them global scale, distributed, secure infrastructure. We want to give them a digital transformation platform that helps people build innovative digital transformation solutions. And then, industry specific capability for digital transformation in a number of industries.”

As noted above, we are expecting more detail on this tomorrow. But I don’t think it’s an approach many would expect from what is often (wrongly) perceived as an ‘IaaS play by Google’.

My take

I’ve been impressed by what I’ve heard and seen on day one of Google Cloud Next. I think the company is differentiating itself in all the right ways from AWS and Azure, playing to its strengths. That doesn’t mean it won’t have its challenges. Aligning itself with vendors that are focused on solving business problems, rather than technical ones, will be interesting to watch, given that Google Cloud is perceived as an infrastructure player. Equally, Google Cloud has its own internal challenges to solve - namely simplifying its go-to-market (one country manager told me that they’re overhauling their contracts, for example) and also scaling up its customer facing teams.

However, its approach, if my assumptions and sense about its strategy are correct, will be incredibly interesting to watch and it makes for a far more interesting battle with the other cloud providers. Namely because I think Google Cloud is actually more likely to need up competing with Oracle, than AWS or Azure.