Google Announces 12 new Data Centres – Game on for AWS


Google has announced that it will be opening 12 new Cloud Data centres over the next 12-18 months to compete with AWS. The first two data centres will be in Oregon and Japan, followed by 10 more centres in as yet undisclosed locations. 

It is doing this to directly target AWS and to a lesser extent Azure in the Public Cloud, Iaas/PaaS/SaaS marketplace. Clearly it will have an impact on other public cloud providers such as IBM and Rackspace.

Whilst the investment is a very positive move, (and parallels strongly with the recent Apple announcement) there is no doubt that Google has been far to slow to the enterprise market opportunity and customer outcomes. The strength of Google as a consumer company transposes sharply with the capability of it in the enterprise. It has lagged in strategy, execution, focus and most importantly customer outcomes. 

In the recently released Australian Infrastructure Management Services Capture Share report, capioIT ranked Google as a “Transform Focus” vendor. It was differentiated because it is Google, but lacked the scale and local capability to come close to challenging AWS. – (see https://t.co/SsaloPaHu7)

In July 2014 following a customer event we wrote that “capioIT was intrigued to find that front and centre at the entrance was a bowl of lemons. I can only guess that Google was going to make lemonade from lemons, sadly, whilst the day had moments of sweetness, Google could not set up the lemonade stand this time around.” (see – http://tinyurl.com/jspw7uw)

The new locations are not disclosed, but if Google is serious in competing with AWS and Azure it has to be in the majority of the following locations in this 12-18 month timeframe. Otherwise, it is not going to win the global scale argument or local reach requirements.

  • Australia
  • Brazil
  • Canada
  • China
  • Germany/Netherlands/France
  • India
  • Korea
  • Singapore
  • UK/Ireland
  • South Africa

If Google seriously wants to disrupt AWS it needs to challenge with locations. If it considers some of the following locations then it may be able to be a differentiated provider in the market. (Note these markets provide significant challenges from a network, regulatory and market perspective, but playing catchup requires risks)

  • Indonesia
  • Argentina/Chile
  • Thailand
  • Kenya/Nigeria
  • UAE

It is also hoped that it understands the customer requirements. When it launched the Taiwan facility, Google seemed to force itself to believe that the cutting edge nature of the centre was enough to make Asian customers rush to it. Except it was in Taiwan. Taiwan is a comparatively small market and had major issues for non-Taiwanese customers. It was a perplexing decision as an outside to Google.

AWS will of course respond. It is clearly the market leader, and the announcement by Google is not going to change that in the short to medium term. It will continue to innovate on price, but as it has done in the last 12-18 months, it will focus to refine the perspective around the ISV and partner ecosystem, functionality, scale and innovation. Amazon as a company has withstood significant competitive challenges whilst remaining dominant, though to be fair, they have not had to fight the likes of Microsoft and Google in the online retail space.

Microsoft has a strong installed base with Azure and of course the Office 365 suite. That will continue to be critical for it, alongside relationships with the likes of Salesforce. IBM’s Softlayer and Rackspace will come under even more pressure, and if Google follows up on the investment, it is difficult to see the need for a fourth provider, that is more than a niche. The differentiation for IBM in particular will take a significant amount of investment.

Capture Point

It finally appears that Google is finally being serious about the enterprise IT market, particularly from a cloud perspective with the announcement of 12 new data centres. The most important outcome of the investment is that enterprise customers (Of Google or others) will be the winner. capioIT strongly believes that competition drives innovation, so when the competition is increased, so to is innovation. That has to be good for the customer and for the entire competitive ecosystem. 

About capioIT - Phil Hassey

capioIT is an advisory firm focused on helping organisations to understand emerging technology in emerging markets. CEO Phil Hassey established the company in 2010
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