Re:Google Cloud Worth $225B, Deutsche Bank Says
by erikig on Friday October 04, 2019 @02:57PM
(#21160780)
This is just history repeating itself.
The same thing happened with the underlying server/architecture/processor providers. For a while it a vibrant field with multiple competitors and high margins. After a while, competition and differentiation drove down margins.
When the margins drop only the best players will be left. Those players will buy out the competition until there's just 2 or 3 big players who will then ratchet up the prices until they reach a stable equilibrium.
And then another layer gets added to this tasty lasagna:
- Processor
- Architecture
- OS
- VirtualizationService
- CloudProvider
And then we start the process of innovation to margin squeeze again...
The same thing happened with the underlying server/architecture/processor providers. For a while it a vibrant field with multiple competitors and high margins. After a while, competition and differentiation drove down margins.
When the margins drop only the best players will be left. Those players will buy out the competition until there's just 2 or 3 big players who will then ratchet up the prices until they reach a stable equilibrium.
And then another layer gets added to this tasty lasagna:
- Processor
- Architecture
- OS
- VirtualizationService
- CloudProvider
And then we start the process of innovation to margin squeeze again...