Facebook, Apple, Amazon, Microsoft and Google. All of them beat even the most optimistic estimates.
Will have to dig into whether the cost of being Apple's default search engine has risen. Generally speaking it should $10 / user / year. Apple just reported another 200M increase in Active Devices. There should be some hint, or may be it will have to wait until next contract negotiation.
I personally think Google can continue at this pace as GCP value is still not unlocked completely. I can't comment on the other services but in my previous job we did shift a lot of compute instances stuff to GCP from AWS because of ease of orchestration. If other services catch up to AWS and with unique offerings like Spanner, a lot of room for them to grow.
Though it is quite scary how these companies are so big and yet growing so fast, a lot of this is because of usurping new markets, like Apple did with Airpods. I just hope this doesn't suffocate smaller players in due time.
Serious question, do you think threatening to remove google as the default search engine is a serious threat? I use ddg and tried Bing when they were paying people to use it, but I have no illusions that google is by far the most superior search engine. It would be weird if they switched the default.
The growth in revenue at 20% is impressive given these players are already so massive.
One big takeaway, AWS is CRUSHING GCP on the financial side. There is basically a 50%?? delta here? Ie, AWS is +28% margin, GCP -30% margin? Still GCP is growing briskly though much smaller.
In short, AWS could do a lot more to compete on price if they wanted.
> One big takeaway, AWS is CRUSHING GCP on the financial side.
Or, Google is investing more to compete? AWS is financially stable now because of its investments in initial years. GCP revenue growth does seem promising.
I'm going to repost a comment I made a couple years ago because it's still 100% relevant:
------
Incredible that Google has been able to sustain almost 20% revenue growth for so long - much longer than most people expected.
For the past 6 or 7 years people have been predicting that Google's growth would soon slow because:
(a) The number of ads on a search result page had reached saturation point
(b) The percentage of people using the internet in rich countries had reached saturation point
Although real, these effects have proved to be outweighed by other, less limited factors of growth; in particular Google's ability improve the quality of match between advertiser and user. Even now I think there is significant room for Google to improve this matching - eg. when I put an iPad Pro in my online shopping basket at apple.com but don't buy it, why don't I then see iPad ads on YouTube? When I give Tesla $1,000 to reserve but not buy a Model 3, why don't I then see Model 3 ads reading The New York Times? Apple and Tesla are leaving money on the table, and when they wake up Google will make even more money
You can see this kind of comment in every YouTube related posts, please, there's no free lunch, either pay for the subscription or use tools to block the ads.
At this stage of cloud, all that's really important is revenue growth. GCP is only a quarter of the size of Azure and AWS - they need to gain market share regardless of how much investment it requires in the short term.
The big question is, does Google consider gcloud so core that it will never give up on it? We are not there yet but it will only take the smallest whiff and Google's reputation for abandoning products will utterly destroy their viability in the enterprise cloud computing market.
The comparisons between GCP and AWS are sobering. AWS booked $13.5 billion operating income on $45.4 billion revenue and is growing at 30% YoY.
GCP lost $5.6 billion on $13 billion in revenue. It’s growing a bit faster but not much considering the small base. The “we’re losing a ton of money because we’re growing” argument smells like the sort of thing unprofitable startups without a viable business model say. It looks really off when you’re competition is also growing super fast and is very profitable.
GCP doesn't need to beat AWS. It doesn't even need to increase market share, really: the cloud market as a whole is growing rapidly, and more money is more money, regardless of bragging rights. It just needs to get to profitability.
There's also a strategic aspect of clipping the wings of AWS by providing a BATNA in the big deal negotiations. With Amazon significantly cutting into Google's advertising market share, it needs another front to put pressure on its strongest competitor. If Google can prevent $10B in Amazon profits by burning $5B of its own money, that's arguably a win.
AWS launched compute and storage in 2006 and took until 2015 to first be profitable.
Google launched cloud compute in 2013 and arguably didn't take it seriously until the last few years. Growing nearly 50% is a great result, even if they're still a distant 3rd.
>The comparisons between GCP and AWS are sobering. AWS booked $13.5 billion operating income on $45.4 billion revenue and is growing at 30% YoY.
yep, AWS spent 30B and got 45B, Google spent 18B and got 13B, that is 2X+ difference in bang-for-buck. And that is without full effect of Graviton2,3, etc. which provides like 1.5x leap in perf/price and perf/energy. With Google loosing that much money one can wonder whether the bean counters there would even risk investment in their own ARM platform and without it the GCP would lose to AWS completely.
It is pretty rare for a company to successfully move down the stack as the margins are typically lower there. The GCP numbers illustrate the case very well.
It's crazy that these companies can grow at this speed even though they are larger than any that existed historically. We're talking about multiple companies with market caps north of one trillion USD with double-digit growth and massive profit margins. We need to have a revamp of anti-trust regulations to break them up, because with their immense financial warchests and the protection of network effects, they are not going to face real competition from anyone. An economy made up of many smaller companies will not just create better outcomes for customers but also distribute wealth better. But right now, I don't get the sense that the competition mechanism works well against these giants.
I don't agree that an economy made out entirely of smaller players is strictly better. I think there pros and cons to each of these scenarios. For example one thing smallest companies cannot do is effectively tackle problems that take huge amounts of funding, engineering and coordination.
> It's crazy that these companies can grow at this speed even though they are larger than any that existed historically.
It's likely that the Dutch East India Company (VOC) was the largest company of all time in both inflation-adjusted terms (estimates made in 2017 put it between $7.9 and $8.2 trillion dollars) and in terms of % share of world domestic product.
[+] [-] ksec|5 years ago|reply
Facebook, Apple, Amazon, Microsoft and Google. All of them beat even the most optimistic estimates.
Will have to dig into whether the cost of being Apple's default search engine has risen. Generally speaking it should $10 / user / year. Apple just reported another 200M increase in Active Devices. There should be some hint, or may be it will have to wait until next contract negotiation.
[+] [-] actuator|5 years ago|reply
Though it is quite scary how these companies are so big and yet growing so fast, a lot of this is because of usurping new markets, like Apple did with Airpods. I just hope this doesn't suffocate smaller players in due time.
[+] [-] panarky|5 years ago|reply
Even more astounding is that they're growing earnings even faster.
Simply unheard of for margins to expand at this point in a company's lifecycle.
[+] [-] bko|5 years ago|reply
But then again... apple maps.
[+] [-] jdminhbg|5 years ago|reply
Don't forget to subtract the ones in China.
[+] [-] nojito|5 years ago|reply
Not to mention the ad proliferation on YouTube.
[+] [-] random5634|5 years ago|reply
Net income $40B for the year through 12/31/2020.
The growth in revenue at 20% is impressive given these players are already so massive.
One big takeaway, AWS is CRUSHING GCP on the financial side. There is basically a 50%?? delta here? Ie, AWS is +28% margin, GCP -30% margin? Still GCP is growing briskly though much smaller.
In short, AWS could do a lot more to compete on price if they wanted.
[+] [-] jacques_chester|5 years ago|reply
Maybe. GCP can be subsidised by Google, but AWS is the breadwinner for Amazon.
[+] [-] amf12|5 years ago|reply
Or, Google is investing more to compete? AWS is financially stable now because of its investments in initial years. GCP revenue growth does seem promising.
[+] [-] MarkMc|5 years ago|reply
------
Incredible that Google has been able to sustain almost 20% revenue growth for so long - much longer than most people expected. For the past 6 or 7 years people have been predicting that Google's growth would soon slow because:
(a) The number of ads on a search result page had reached saturation point
(b) The percentage of people using the internet in rich countries had reached saturation point
Although real, these effects have proved to be outweighed by other, less limited factors of growth; in particular Google's ability improve the quality of match between advertiser and user. Even now I think there is significant room for Google to improve this matching - eg. when I put an iPad Pro in my online shopping basket at apple.com but don't buy it, why don't I then see iPad ads on YouTube? When I give Tesla $1,000 to reserve but not buy a Model 3, why don't I then see Model 3 ads reading The New York Times? Apple and Tesla are leaving money on the table, and when they wake up Google will make even more money
[+] [-] gundmc|5 years ago|reply
[+] [-] sniperjzp|5 years ago|reply
[+] [-] seaman1921|5 years ago|reply
And don't forget they are paying a huge sum to the content creators as well - it is a delicate balance.
[+] [-] 2OEH8eoCRo0|5 years ago|reply
https://github.com/TeamNewPipe/NewPipe
[+] [-] polote|5 years ago|reply
[+] [-] mav3rick|5 years ago|reply
[+] [-] jansan|5 years ago|reply
[+] [-] belval|5 years ago|reply
EDIT: https://vancedapp.com/
[+] [-] PieUser|5 years ago|reply
[+] [-] gundmc|5 years ago|reply
[+] [-] threatripper|5 years ago|reply
[+] [-] zmmmmm|5 years ago|reply
[+] [-] seshagiric|5 years ago|reply
[+] [-] JCM9|5 years ago|reply
GCP lost $5.6 billion on $13 billion in revenue. It’s growing a bit faster but not much considering the small base. The “we’re losing a ton of money because we’re growing” argument smells like the sort of thing unprofitable startups without a viable business model say. It looks really off when you’re competition is also growing super fast and is very profitable.
[+] [-] scarmig|5 years ago|reply
There's also a strategic aspect of clipping the wings of AWS by providing a BATNA in the big deal negotiations. With Amazon significantly cutting into Google's advertising market share, it needs another front to put pressure on its strongest competitor. If Google can prevent $10B in Amazon profits by burning $5B of its own money, that's arguably a win.
[+] [-] gundmc|5 years ago|reply
Google launched cloud compute in 2013 and arguably didn't take it seriously until the last few years. Growing nearly 50% is a great result, even if they're still a distant 3rd.
[+] [-] trhway|5 years ago|reply
yep, AWS spent 30B and got 45B, Google spent 18B and got 13B, that is 2X+ difference in bang-for-buck. And that is without full effect of Graviton2,3, etc. which provides like 1.5x leap in perf/price and perf/energy. With Google loosing that much money one can wonder whether the bean counters there would even risk investment in their own ARM platform and without it the GCP would lose to AWS completely.
It is pretty rare for a company to successfully move down the stack as the margins are typically lower there. The GCP numbers illustrate the case very well.
[+] [-] lawrenceyan|5 years ago|reply
[+] [-] throwawaysea|5 years ago|reply
[+] [-] d1zzy|5 years ago|reply
[+] [-] jacques_chester|5 years ago|reply
It's likely that the Dutch East India Company (VOC) was the largest company of all time in both inflation-adjusted terms (estimates made in 2017 put it between $7.9 and $8.2 trillion dollars) and in terms of % share of world domestic product.