Apple is stuck between two major competitors when it comes to obtaining cloud space. Historically, the iPhone maker has used Amazon Web Services and Microsoft Azure to store data and, while analysts have predicted it would turn away from AWS soon, heading over to Google didn’t quite seem like the move Apple would make.
But that’s what a report from CRN claims is happening now, with Apple spending as much as $600 million on a deal to use Google Cloud Platform for iCloud data storage. That’s more than half the estimated $1 billion Apple spends on AWS and would double the estimated 2015 fourth-quarter revenue of Google’s cloud platforms.
The move may just be a stopgap measure for Apple though. The company is building data centers around the world as it offers more cloud-based features on iOS and Mac. The company admitted in a 2015 security report that it stores encrypted files on Amazon S3 and Microsoft Azure cloud platforms.
The move would be a second big win for Google in recent weeks; Spotify picked Google for hosting its streaming music library less than a month ago. Spotify engineering head Nicholas Harteau said at the time that Google beat competitors on price. While none of the parties confirmed the move reported today, Google was likely willing to offer its services to Apple for a lower price point than Amazon or Microsoft.
Google’s extensive (and growing) fiber network may have also played a part. With Apple pushing app updates, new music and iMessages out to users around the globe, getting them out quickly can be big boost for Apple. And the fiber connections cut down on bandwidth payments, helping to reduce the costs further.
The decision may have also come down to talent, with Google recently bringing on VMWare co-founder Diane Greene to head a unified cloud services division. Google’s vice president of infrastructure claimed that the company’s cloud revenue will pass its advertising revenue before the end of the decade, a sign that Google takes the business very seriously.
Update: An AWS spokesperson reached out to GeekWire after this story was published.
“It’s kind of a puzzler to us because vendors who understand doing business with enterprises respect NDAs with their customers and don’t imply competitive defection where it doesn’t exist,” the spokesperson said.
While CRN didn’t name sources, the authors claim to have verified the move with multiple parties.