Some things, even huge piles of money can’t buy.
One of those things might be the ability to unseat Amazon.com Inc.’s [stckqut]AMZN[/stckqut] AWS as the king of the cloud computing market. Not that others haven’t made a game effort. The two largest challengers— Microsoft Corp.[stckqut]MSFT[/stckqut] and Google parent Alphabet Inc.[stckqut]GOOGL[/stckqut]—have dropped about $52 billion combined in capital expenditures over the past three years, much of which goes toward their massive networks of data centers and related equipment. That’s double what the two spent over the previous three-year period.
It’s not been without results. Microsoft’s Azure cloud service more than doubled its revenue in 2016 to about $2.7 billion, according to estimates from J.P. Morgan. Google’s Cloud Platform surpassed $1 billion in revenue in 2016, estimates Aaron Kessler of Raymond James.
The latter is particularly of note, given that it’s been barely a year since Google brought in former VMware chief Diane Greene to run the cloud division and focus on enterprise customers. It took AWS at least five years to hit the $1 billion mark, judging from Amazon’s limited disclosures at the time.