From two sources.

1) The article.

> The Google unit, which sells computing services to big companies, is under pressure from top management to pass Microsoft or Amazon—currently first and second, respectively, in cloud market share—or risk losing funding.

2) How Google treats all of its other "underperforming" products.

> 1) The article.

That only means that the team's head is on the chopping block. That's all.

> 2) How Google treats all of its other "underperforming" products.

This assertion is utterly absurd as you're describing the world's third largest cloud provider, and thus one of the dominant players, of being "underperforming" and justifying pulling the plug on a 8 billion-dolar a year business.

Google is far from the world’s “third largest provider”

https://www.techrepublic.com/article/public-cloud-market-sha...

As far as the manager “being on the chopping block” the article talks about “losing funding”.

$8 billion in revenue means nothing. Is it profitable?

This is the same company that left an entire city’s streets in disarray after abandoning Google Fiber.

https://arstechnica.com/information-technology/2019/02/googl...

> Google is far from the world’s “third largest provider”

You're being a bit disingenuous. Your own source states quite clearly that Google is in the 3rd spot and arguably, if you cherry-pick results, you can place it in 4th.

By cherry-picked results I'm referring to posting 2018 results and ignoring how GCP's revenue doubled in the last 18 months, nearly matching Azure's revenue.

So let’s look at the raw marketshare. It’s 10% of AWS.

Also revenue != profit. If it was profitable enough would management be complaining?

> So let’s look at the raw marketshare. It’s 10% of AWS.

Yes, AWS is 1st. What's your point? Azure is 2nd and GCP is currently 3rd and catching up with Azure. What does AWS has to do with whether GCP is 3rd or 4th?

Jesus, talk about hyperbole. "Far"? Trailing a couple percent behind Alibaba, a chinese only hosting provider? Get real

Alibaba operates and serves internationally.

Let’s take the raw numbers then. 4.8% compared to 47%.

At what growth rate?

Not high enough for management obviously. Also, is it growing profitably.

I believe the 8 billion a year number includes its G-Suite products. My understanding is that GCP itself makes only around 1-2 billion a year (excluding G-Suite). That doesn't seem enough to cover the CapEx, OpEx and engineering costs they are sinking into keeping GCP running.

Only Amazon breaks out its AWS numbers completely today, but the other cloud providers bundle their cloud computing numbers together with other "cloud" numbers, so it makes it very confusing to keep track of what numbers people are talking about.

Is not Amazon also doing this. Just that no one uses Amazon's Word (I just know it exists do not know even its name) :)

If it's profitable why do they care if it passes Amazon or Microsoft?

I'm fairly certain Google Cloud is not profitable. Even if it is profitable, Google will divest from business that don't hit a certain scale (billion $ businesses). Basically their goal is to never have employees staffed on projects which yield a low $ / employee ratio. They will invest for a while, but pull the plug after some arbitrary time if it doesn't hit the scale.

Exactly, which is the exact opposite of what AWS is doing. They have how many services that very few people use now? But at least they respect their customers and view the cost of running those services as goodwill for their customers.

They like to use small teams. I wouldn't be surprised if their least-used AWS product is still profitable (aside from brand-new stuff or obvious non-profits like Deep Racer). The idea is to get people into AWS and help keep them there. You don't do that by making life harder or unpredictable for your customers.

It's the opposite of what AWS is doing, but not what Amazon as a whole is doing. There was a recent article that said they're considering cost-cutting in the Alexa business unit [1].

[1] https://www.theinformation.com/articles/amazon-learns-a-new-...

Does it seriously take 10k people to make Alexa? And she's way dumber than Google. Yes, they should be cutting some costs.

Maybe it's one of those many-if-statements style AIs.

We prefer to call them decision trees. It sounds far fancier.

And that's not a bad way to move at least in the short term. The problem is that longterm, people will avoid your products pre-emptively for fear of them being vaporware. Especially with something as serious as cloud implementation in an organization. I would hate to be the guys who now have to rearch all their applications to go from GCP to AWS.

Because it's not profitable "enough". Presumably they'd like to reassign their engineers on projects that could make more money.

That makes sense in the abstract but of the dozens, maybe hundreds, of projects Google is currently working on, how many outside of Ads make a sizable amount of profit?

A mildly successful cloud provider would probably make FAR more money long term than the median Google product. Pulling the plug on GCP to build a couple dozen projects that will mostly get killed themselves seems like a huge waste, even without considering all of the negative externalities of burning even more customers by cancelling a major service.

Margin and expected future profits, I assume.

Breaking even doesn’t cut it since capital could be put toward something better. Unless it has some other strategic value (eg, bragging rights, growth potential, security, etc)

Pride? They want to be #1 or nothing at all?

If you look at the way profits are distributed in a category, this goal makes perfect logical sense. What percentage of ad-tech profits do you think Google gets from being #1?

Unfortunately it's nearly impossible to be #1 in every business you touch.

"The Google unit, which sells computing services to big companies, is under pressure from top management to pass Microsoft or Amazon—currently first and second, respectively, in cloud market share—or risk losing funding. "

A little bit of reading between the lines combined with Google's history of sunsetting services that aren't creating enough profit.

Since at least as of this writing, nobody else has mentioned this, and it's always someone's day [1] to hear something the first time, this is a variant of something that goes very far back in our industry called the Osbourne Effect: https://en.wikipedia.org/wiki/Osborne_effect

The traditional Osbourne Effect that earned the original namesake is to announce your v2 product a long time before it's available, thus trashing your v1 sales and eliminating the resources needed to make the v2 in the first place. But this is fairly similar; by announcing at what point Google is planning on throwing in the towel, everyone is going to think twice about going to GCP, because now everyone knows that everyone else is going to think twice about going to GCP. Consequently, the odds of this article actually creating the future in which Google pulls the plug on GCP are quite good.

Also, note how this is all about perception, and people's beliefs about what other people believe. Arguments like "But GCP is really good!" or "But GCP will surely continue to be very supported by Google right up until then!" would be missing the point. The point is that you need to change not only what everyone believes, but what everyone believes everyone else believes. Easier in some ways, harder in others, but none of those sorts of basic arguments will move the needle one bit. You need different arguments.

So, basically, in our industry, with this sort of folk wisdom widely known, Google damn near announced their plan to shut down GCP after 2023. They didn't. Quite. But damn near. Yes, it's a sort of second or third order conclusion from the literal text of the article, but it's a very easy one that lot of people can make, which ironically is the very thing that makes it true in the first place.

(Also, since PR is pervasively dishonest, putting out a PR release that says "No, srsly, we love GCP and would never dream of shutting it down" will not move the needle anywhere near as much as they'd like. Also in the "what people believe other people believe" department, Google has a reputation now of just shutting things down. GCP would be quite a bit bigger than anything else they've shut down, but, even so, they've shut down some pretty big "all hands on deck" initiatives before, like G+, so we're all going to believe that everyone else is going to find the idea that they might just pull the plug quite plausible. If they had a reputation for supporting things and gracefully shutting them down with care and concern, they'd be in significantly less trouble now.)

[1]: https://www.xkcd.com/1053/

An (in)famous recent example of the Osborne effect deserves mentioning here: https://blogs.wsj.com/tech-europe/2011/02/09/full-text-nokia...