Google moves parts of YouTube to its cloud service
Sundar Pichai, CEO of Alphabet
David Paul Morris | Bloomberg | Getty Images
Google is moving parts of its popular YouTube video service from the advertising company’s internal data center infrastructure to the company’s cloud service, the Google cloud manager said.
The effort indicates that Google is looking inward as it seeks to expand its share of the growing cloud computing market and become less reliant on ads appearing on its web search engine and other properties.
Historically, Google has relied on its own systems to run its most used applications on computer servers in its data centers. The Google Cloud Platform offering coexisted separately, and Google did not undertake the effort to migrate its eponymous search engine, for example, to Google’s public cloud.
But the company’s perspective on the value of using the cloud by its best products, just like third-party apps, has changed.
“Part of the evolution of the cloud is that our own services are using it more and more, and they are,” Thomas Kurian, CEO of Google Cloud, told CNBC in an interview last month. “Parts of YouTube are in the process of migrating to Google Cloud.”
In 2019 Amazon mentionned its consumer business had deactivated its final Oracle database in favor of Amazon Web Services databases, after years of work. Microsoft has sought to make its LinkedIn social network and Minecraft video game no longer reliant on the company’s Azure public cloud.
The set of Google Workspace productivity apps formerly known as G Suite, the navigation app Waze and the artificial intelligence research group DeepMind all rely on Google’s cloud infrastructure, said Kurian.
YouTube is different. It is the second largest website on the Internet, according to Amazon Alexa Analysis Tool, with over 2 billion users every month. Google purchased the property in 2006 for $ 1.65 billion.
Google’s decision to consume public cloud resources for YouTube and other mainstream services could make life easier for corporate vendors, who are constantly trying to persuade large companies to try and rely on the cloud to Google or run existing apps on the Google Cloud platform. Vendors will be able to say that Google’s cloud is good enough for critical business workloads.
This, over time, could increase Google’s cloud revenue. In the first trimester nearly 58% of revenue for Google’s parent company, Alphabet was from the Google and Other Search category, which includes advertising displayed on the Google web search engine, Gmail, Google Maps and other online destinations it operates. Google’s cloud business, which includes public cloud and Google Workspace, generated 7% of revenue but grew faster.
The cloud unit has slashed Alphabet’s operating margin with billions in annual losses for at least three years, but the largest cloud infrastructure provider by revenue, Amazon Web Services, has become a key source of profit.
Google held 5% of the cloud infrastructure market in 2019, while Amazon held 45% and Microsoft around 18%, according to the tech industry research firm. Gartner. Gartner has not released more recent figures.