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>, otherwise it will risk losing funding. Are you doing anything about this to de-risk? To level-set, I don't think customers need to worry about GCP literally
by jasode 4y ago
>, otherwise it will risk losing funding. Are you doing anything about this to de-risk?
To level-set, I don't think customers need to worry about GCP literally "shutting down" like Stadia being discontinued.
GCP already has many significant customers including Walmart, Sabre travel reservations, etc. Many customers have long-term 10-year multi-billion dollar contracts with Google Cloud.
But the $22 billion in revenue which finally had positive margins just this year[1] may not be compelling enough for Google to focus on as a strategic business.
If so, the worst case scenario if GCP doesn't "earn its keep" at Alphabet is to spin it out as a separate company or sell their cloud business to IBM, Oracle, or Microsoft. Even if Alphabet calls it quits on Google Cloud, all the customers utilizing the service won't have their servers shut down. It won't be a Stadia type of shutdown.
Big companies sell pieces of the company all the time. E.g. IBM sells pc/latop business to Lenovo. Intuit sells Quicken to a private equity firm. Microsoft spun out the Expedia division into a separate company.
The real risk of staying on GCP is whether that platform will stay "cutting edge" on par with AWS because of parent company's continued focus and investment. If Alphabet sells GCP to a stodgy slower company like IBM or Oracle, customers may end up with a stagnant platform. If it gets sold to a more nimble company like Microsoft that has proven track record in making Azure profitable, customers may win by getting more platform innovation that Alphabet would have no longer wanted to fund.
The GCP business -- some form or another -- will continue to run for the next 10+ years; it just may not be owned by Alphabet.
[1] https://seekingalpha.com/article/4501164-google-cloud-trillion-dollar-valuation-is-in-sight https://seekingalpha.com/article/4501164-google-cloud-trilli...
- candiddevmike 4y agoGCP is practically embedded into Google's internal infrastructure and global network. You can't spin that out, it's too intertwined.
- wsgeorge 4y ago> You can't spin that out, it's too intertwined. Which, I imagine, makes a complete shut down unlikely. Not that that is required for customers to lose confidence in the product...