Apple’s iCloud May Be Drifting To Google

March 16, 2016, 10:38 PM UTC
Apple Profit Rises 78% On Demand For IPads, IPhones, As Steve Jobs Takes Leave Of Absence
The 1 Infinite Loop building stands at Apple Inc.'s headquarters campus in Cupertino, California, U.S., on Wednesday, Jan. 19, 2011. Apple Inc., whose Chief Executive Officer Steve Jobs said on Monday that he is taking a medical leave of absence, posted a 78 percent jump in quarterly profit, helped by holiday buying of iPads, iPhones, and Macintosh computers. Photographer: Tony Avelar/Bloomberg via Getty Images
Photograph by Tony Avelar — Bloomberg via Getty Images


This is interesting: Apple may be moving a chunk of its iCloud business—you know, that ethereal place where you store your photos and documents— to Google’s cloud, lessening its dependence on Amazon Web Services, according to a report from tech news site CRN that cites unnamed sources.

If true it will be a big boost for the Google (GOOG) Cloud Platform at a time when it is trying to position itself as one of the big three public cloud providers along with market leader Amazon (AMZN) Web Services and Microsoft (MSFT) Azure.

In the public cloud model, one company buys and operates huge amounts of compute power, storage and networking bandwidth that it rents out to businesses that do not want to build more of their own infrastructure.

The report comes a week before the Google Next conference, at which the company will likely announce new features and customers for its cloud platform. Diane Greene, the VMware (VMW) co-founder who was named as head of Google’s enterprise efforts, will be on hand in her first major public forum since taking that job last November.

From the story:

According to the sources, Google executives have told partners that Apple is spending between $400 million and $600 million on Google Cloud Platform, although this couldn’t be independently confirmed. Also unclear is whether this range refers to an annual spending rate or a set amount of capacity.


So that’s a bunch of wiggle room. Presumably this could also affect Apple’s use of Microsoft Azure. Although the companies are typically tight-lipped on such topics. Apple let slip its use of Azure and AWS in this white paper.

Fortune has reached out to all of these companies. Google and Apple did not return calls. An Amazon spokesman sent the following statement:

“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.”

In cloud, Google jockeys for position

But here’s the thing. Given Apple’s famous insular nature, it’s hard to see it relying on these big players in the long term.

Apple is spending a ton on its own data center infrastructure. Last month Morgan Stanley analysts cited $3.9 billion in planned capital spending as an indicator that it is building its own massive data centers in the U.S. and Europe. The analysts said that as Apple starts using more of its own data center capacity, its spending on AWS—which the analysts estimated to be $1 billion a year—will trail off.

For a look back at iCloud history, check out this video:

The bottom line is that no one outside these companies knows anything officially, but I would guess that Apple knows it has to control its own destiny when it comes to cloud infrastructure.

This is especially true as Google, Amazon, and Microsoft are all huge competitors to various pieces of Apple’s business. So for Apple to allow a dependency to grow on one or more of their clouds just doesn’t seem likely.

Still it takes years to build data centers. I agree with one long-time cloud watcher and IT consultant who said Apple always wants to control its own technology stack which means Apple will play these cloud providers off against each other until such time it’s ready to jettison all of them.

But hey, I’ve been wrong before.

Note: this story was updated at 7:51 a.m. EDT on March 17, to add a link to the Apple white paper mentioning iCloud’s use of AWS and Azure and Amazon’s statement.

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