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TikTok Agreed to Buy More Than $800M in Cloud Services from Google
- DevX101 6y agoTikTok could have had hosting for cheaper from Alibaba, but now Google has an $800M incentive to keep TikTok alive in the U.S. Smart.
- dodobirdlord 6y agoAlibaba has a whole 2 regions in the US, and they’re much smaller than AWS/GCP regions. They are not a significant infrastructure player outside of China, and an app like TikTok is high bandwidth and latency sensitive. It’s not feasible to host something like that entirely out of datacenters in China.
- coliveira 6y agoGood move. Google will think twice if it is a good move to remove clients from their platform. I think TikTok has to show they cannot go around banning apps left and right without financial repercussions.
- subsubzero 6y agoTikTok/Bytedance seems to be growing like crazy, I had three different recruiters from that company reach out to me in the past month. I declined for many various reasons, but mainly what would happen if they were banned in the US which seems like it could happen( I would prb be without a job in short order!). Would all US operations cease and a contract like this be voided and refunded?
- deleted 6y ago[deleted]
- xvector 6y agoByteDance pays INSANE compensation. Significantly more than any of the FAANG. You should consider it.
- logicchains 6y agoGoogle is banned in China yet still has a decent sized office there.
- coronadisaster 6y agoMakes sense, now the US Government also gets their data.
- scarface74 6y agoJust for reference, GCP earns $10 Billion a year and this deal is $800 Million over three years. Whether this is a big deal is an exercise for the reader. https://www.zdnet.com/article/google-cloud-hits-a-10b-annual-revenue-run-rate/ https://www.zdnet.com/article/google-cloud-hits-a-10b-annual...
- pcl 6y agoThat comes to 2% of this year’s revenue. I’d say that’s a pretty big deal. I can’t imagine Google has many individual customers representing more than 2% of revenue. Math says that at the least, they are one of the top 50 customers.
- deleted 6y ago[deleted]
- scarface74 6y agoThere are two types of customers that every B2B company wants - customers that bring in a lot of money and “referenceable” customers that are willing to stand up on stage and have their companies listed in marketing documents. TikTok being referenceable means a lot more so sales people can go out and tell CxOs “look we are a safe choice because $x company trusts us”. Disclaimer: Just in case I get called out. I work for AWS consulting but I am so far removed from the sales process it’s not even relevant. All opinions are my own. I’ve been in the room more when “enterprise deals” were being made in smaller B2B companies.
- aubeards 6y agonice!!! let's get this referenceable asap!
- scarface74 6y agoYeah. I’ve heard that a previous companies. I am afraid that I’m going to become “that guy”....
- 6y ago
- replwoacause 6y ago"Join now to read the full story"? This is obnoxious. If you are going to share a news article the requirement shouldn't be that everyone interested in reading it must sign up for a new service. This isn't necessarily a dark pattern... but it seems related somehow. Is there a term for it? Also, why is theinformation the only news source I see reporting on this? Is this some kind of an exclusive?
- bigtones 6y agoFor comparison, another reference GCP customer is SnapChat who signed a 5 Year $2 Billion dollar contract with Google Cloud, as they disclosed in their IPO Prospectus. At that time (2017) they were by far the largest single customer on the Google Cloud Platform by spend. They spend the majority of that on App Engine, Cloud Storage, BigQuery, and bandwidth. Even after this disclosure of the TikTok $800M Agreement - SnapChat is still a much larger customer in spend per year. https://www.vox.com/2017/3/1/14661126/snap-snapchat-ipo-spending-2-billion-google-cloud https://www.vox.com/2017/3/1/14661126/snap-snapchat-ipo-spen...
- deleted 6y ago[deleted]
- ct520 6y agoIf tiktok had was under the influence with Chinese government why wouldn't think do this to keep things on the up and up. Look at us guys - we put data in US. All good nothing to see here. (as china still can request whatever it wants). I dont see the point in this.
- rafiki6 6y agoI really think this is just a company that went to get the best deal because the homegrown offering wasn't as competitive. I still think having TikTok isn't in the best interest of the democratic west, but you're right. There is not sinister play here.
- ct520 6y agoMan my iphone really butchers my messaging with weird auto correct now and days. Anyways I think you got the gist. Makes sense about best deal, thought didnt cross my mind.
- ngcc_hk 6y agoMoney can buy you everything. The country is so poor that what is left is money. Done. No; when is infrastructure is just a hardware where you run your software. When is the software hack that push a button send info back to China or analysing in American soil using American expert but helping communist to slightly bias and ... Is an American firm can be trusted even. And a Chinese controlled one?
- techntoke 6y agoExplains why they ignore the obvious violations and still publish the app in their store. Seems like a major conflict of interest.
- qserasera 6y agoBribery always works at suppressing outrage and information dissemination
- leptoniscool 6y agoThis might be a bit off-topic, but why is the US worried about Tiktok? They only show short funny/interesting videos that have almost no political content. If anything, apps like these bring people around the world together.
- qazpot 6y agoTikTok is a huge privacy concern because it is controlled by the Chinese state appratus which uses it to spy on other countries citizens
- x3n0ph3n3 6y agoIt's believed that TikTok scoops up more data from your device than you think and is a major data collection source for the CCP.
- hackerman123469 6y agoNot just believed but actually proved with reverse engineering. They even have the app download remote files and executing them which no app should ever do. (Only on Android since iOS does not allow that!)
- hackerman123469 6y agoYou haven't heard how much data collection they do? They even collect data about your other apps on your phone etc.
- rawoke083600 6y agoWasn't one of the promises of cloud - "it will save us money ?" It's hard to visualise the end result of "savings exercise" for ppl to put funny video's on the internet is 800M /s :) Yea I know they big and there is a lot I don't graps/knows about their system
- fooblat 6y agoGoogle Cloud sales are very aggressive with discounts and offers. They offered my company great prices vs AWS and they even offered to pay for local contractors to do some of the migration work from AWS for us. We took the deal and it's worked out well in both price and performance.
- timvisee 6y agoThis page presents me with an (email) paywall.
- jyriand 6y agoI might have missed the train somehow. First time I heard about TikTok was about half an year ago and now it's already buying services for 800M. How did it get so big so fast or was it already huge deal in China before it reached us?
- caretak3r 6y agoIt would be nice to have articles that don't force you to pay for a subscription.
- gowld 6y agoByteDance runs two video services. One is TikTok, which runs on non-China servers. The other is Douyin, a regular Chinese app. Of course TikTok is still subject to Chinese law governing Internet services provided to foreigners, which is cause for concern.
- varbhat 6y agoAren't US going to ban TikTok?(i heard something like this previous week) If US banned TikTok, willn't that decision affect TikTok? (like it affected Huawei)
- yellow_postit 6y agoPart of this commitment may be to incent Google to lobby on behalf of TikTok against a ban.
- jsnell 6y agoThat seems unlikely, given the readable part of the article says that this happened in "May 2019".
- ninjaturtlez 6y agoYou're right, they've been at it for a year already. Probably why the app isn't banned yet
- stu2b50 6y agoAt some point people in the administration talked about potentially doing something to that effect. I highly doubt it will ever materialize.
- enitihas 6y agoUnlike Huawei, TikTok doesn't have critical production dependency on the US (specialized semiconductors). Huawei also won't have been too impacted if just their imports were blocked in the US. TikTok will be hurt without US customers, but they are too big in China that they will easily survive. And will easily compete worldwide against any US company.
- sudosysgen 6y agoEven Huawei functionally has an advanced enough node at SMIC (14nm-ish) to fulfill their core industry.
- ArtWomb 6y agoI believe it. 1B daily users globally. Processed events per day probably somewhere in the trillions. In case you missed it, they recently shared some details on their algorithmic curation system ;) https://newsroom.tiktok.com/en-us/how-tiktok-recommends-videos-for-you/ https://newsroom.tiktok.com/en-us/how-tiktok-recommends-vide...
- soared 6y agoNo chance they have 1B DAU. That doesn’t pass the sniff test. That’s like 1.5B MAU, which is even more ridiculous. But let’s look.. 7 billion people, 4.5B have internet access. So more than over 15% of humans with internet access are using tiktok every day. 3.5B humans have a smart phone, so 1 in 3 are on tiktok every day? Nah. And honestly, I’m fairly even on china but I don’t really believe numbers the put out for most things. https://www.statista.com/statistics/617136/digital-population-worldwide/ https://www.statista.com/statistics/617136/digital-populatio... https://www.bankmycell.com/blog/how-many-phones-are-in-the-world https://www.bankmycell.com/blog/how-many-phones-are-in-the-w...
- gibolt 6y ago1.5B MAU is not unreasonable. A majority of Chinese users are using it. It is superfluous when you ride the subway or eat in a restaurant. Everyone. That alone could be .75-1+B. Then you only need a relatively small percentage of the rest of the world to reach that number. Just because you can't see it, doesn't mean it is not real.
- posnet 6y agoInteresting, I wonder what discount rate they are getting, or if 'buy' actually just means 'use'. GCP was throwing discounts and credits at companies not too long ago, if you were willing to publicly announce your move from a competitor to GCP.
- jeffbee 6y agoMust be all on the backend because everything they serve that I can see flying past is coming from either AWS or Akamai.
- habosa 6y agoOT: Can we stop sharing The Information links on HN? They seem to have the strictest paywall of anyone. I doubt many commenters here actually subscribe which means we're just discussing the headline.
- detaro 6y agoIndeed. Anyone have a working workaround link? (which is required to exist for paywalled sites according to HN rules?)
- pl0x 6y agoPlease pay for quality content or don't complain about clickbait journalism.
- nindalf 6y agoI think it's reasonable to ask for an alternate link.
- oh_sigh 6y agoComplaining that something is generally behind a paywall is different from complaining that a site centered around widespread discussion of content frequently promotes content behind a paywall. I'm fine paying for content, but the content rarely belongs on HN, because it is insane to say to the general HN reader "Hey, here's an interesting article. Pay to read it before you have any idea of what it is about beyond the title". What happens when you have pay-to-read content on HN is that no one actually discusses the content of the article, and only discusses general topics relating to the topic of the article - making for lower quality discussions.
- kgog 6y agoIt's relevant enough to get you to click on the link, then read through comments, and leave a long comment. If you want a good discussion for a topic you like, go pay for access to it. Nowhere in HN rules does it say that content cannot be behind paywalls.
- cairoshikobon 6y agoAm I missing something? The article says this was a May 2019 deal. Why is this news now?
- yogue 6y agoDitto^
- andy_ppp 6y agoInteresting, I suppose a little reminder to Google not to remove Tiktok?
- advisedwang 6y agoBecause it only just came to light!
- pl0x 6y agoGoogle is clearly in with the CCP at this point.
- baskire 6y agoMakes sense. It ensures google faces repercussions from removing tiktok from the Android play store.
- badrequest 6y agoThis deal is from May 2019, well before anybody was talking about banning TikTok.
- kutorio 6y agoIt's not hard to imagine them planning ahead. In fact you can argue that the parent company ByteDance has planned for such existential risk by setting up TikTok as a separate entity from Douyin.
- justicezyx 6y agoThat of course was the case. Mega corporations are as powerful as small sovereign nations, they have to behave like one...
- donedealomg 6y agoI disagree, many countries where already investigating TikTok in 2018. They had time enough to prepare.
- afrojack123 6y agoYep. They did the same thing to Amazon. Say the delete Tiktok email was sent in error or else risk losing our business.
- rafiki6 6y agoIt's a lot of money, but doesn't overall hurt the viability of GCP. That business is growing like crazy with or without Chinese companies.
- arvinaminpour 6y agoTikTok seemed to run off of Alibaba Cloud (from what I read which may be wrong) so it's an interesting move to buy Cloud Services from Google. I probably read this as a way of strengthening the case that they're an "American" software company since they run on the same infrastructure as any SV startup.
- throwawaybab323 6y agoJust curious, what is Alibaba Cloud is it a service similar to AWS?
- ed25519FUUU 6y agoAccording to Chinese law, the government can quietly demand any information they want on anyone. A warrant in China? Hah. All they have to do is say "Give us the data stored on GCP host" and TikTok is legally obligated to comply. To be fair, it's not much different than in the United States unless the data belongs to a US citizen, which is why many companies are attempting to domicile cloud data in their own country.
- noetokyo 6y agoWouldn't it look suspicious if they did that though? I'm curious to know. If they ever were audited wouldn't that stand out?
- kupopuffs 6y agoI dont see why. Accessing data on a service you are renting? Seems like normal everyday kinda stuff
- noetokyo 6y agoI was thinking about the volume of the data and the type. But yeah they probably could easily obfuscate it. Wouldn't it just be cheaper to buy it at that rate though? Am I missing something?
- jonplackett 6y agoI think snapchat have a similar massive deal with Google. It really does solidify a kind of class structure within these tech giants. Google, Apple, Microsoft, Amazon at the top and everyone else, even massive players like snap and tick tock are completely reliant upon them.
- deleted 6y ago[deleted]
- jgalt212 6y agoFANG has seized the means of production.
- bananabreakfast 6y agoNetflix is 100% AWS
- sitkack 6y agoNot for video delivery, AWS runs lots of stuff but not video delivery, so your statement might give people the wrong impression.
- scarface74 6y agoNetflix’s video encoding and I believe video delivery starts at AWS. They have their own boxes in data centers but those are cache servers.
- el-salvador 6y agoThe Netflix Open Connect appliances.
- jonas21 6y agoThat's an odd way to look at things. Google, Microsoft, and Amazon are in turn reliant on Intel for the CPUs that power their cloud services. Does that put Intel in a class above them? No -- it's just companies buying stuff from other companies so they can focus on what they're good at. * and going one step further, all of these rely on a handful of janitorial companies to operate. so maybe the ABMs of the world are in the top class?
- rwmj 6y agoI wonder if there is a salesperson getting an insane commission from this transaction. More generally/seriously how exactly does this conversation go? I've seen deals at my company which have been in the 7 figure range (involving many, many people) but never anything so large. Is this the kind of thing discussed only at C* level?
- Joe8Bit 6y agoI was tangentially involved as a consultant when a major bank bought a few billion USD in GCP services. Others have mentioned whole 50 person deal teams from both sides, multi year processes, all of Google’s most senior execs pressing the flesh etc. But to your question this type of deal usually goes beyond even the C Suite, to a companies board and shareholders. The bank I was involved with held an ‘Extraordinary General Meeting’ for reps of major shareholders, to present its case and get sign-off. This part of the process was actually the longest, it took ~6 months. That was because the shareholders of the bank had interests to be accommodated, for instance one of them was also a major holder of Amazon stock so they had a vested interest in having the bank choose AWS. They needed to be worked around or convinced choosing GCP would create more value for them than portfolio synergies.
- deadmutex 6y ago> for instance one of them was also a major holder of Amazon stock so they had a vested interest in having the bank choose AWS Thank you for highlighting this. It is a reminder to engineers that sometimes the best technical solution doesn't win because there are usually many factors at play.
- swyx 6y agothat sounds like a conflict of interest if a board member's shareholding has to be accommodated.
- Joe8Bit 6y agoWasn't a board member, it was a pension fund who held stock in the bank.