Amazon, whose Amazon Web Services unit remains the biggest player in data-storage rental and computing capacity, saw its stock drop 2.5 percent after a report by a tech publication.
Google appears to have won some of Apple’s massive spending on cloud services as the search engine giant steps up its game in a lucrative market hitherto dominated by Amazon.com.
Amazon, whose Amazon Web Services (AWS) unit remains the biggest player in the rental of storage and computing capacity, saw its shares drop 2.6 percent in the wake of a report by tech publication CRN citing unnamed sources. It closed at $559.44, down $14.83.
Google and Apple didn’t reply to requests for comment. Amazon downplayed the idea of its Apple business being taken away by a competitor.
“It’s kind of a puzzler to us because vendors who understand doing business with enterprises respect (nondisclosure agreements) with their customers and don’t imply competitive defection where it doesn’t exist,” an Amazon spokesperson said.
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The news underscores how the huge potential of the cloud as a business is luring aggressive competition.
Amazon helped jump-start the field 10 years ago, and became the dominant player. But now Microsoft, Google and others are becoming important players, all seeking to capitalize on the recent trend of businesses migrating a big chunk of their data from their own centers into the cloud.
Apple, a big consumer-tech company with lots riding on the cloud, is a huge prize for any provider. CRN cites sources saying Apple is spending between $400 million and $600 million on the Google Cloud Platform.
Analysts with Morgan Stanley had said in February that Apple planned to spend $1 billion in 2016 with AWS — a huge chunk of Amazon’s cloud revenue, which is estimated to be about $10 billion a year.
The analysts warned that Apple plans to lessen its dependence on Amazon by building out its own data centers. Apple finds it is increasingly competing with Amazon on consumer products and tech services.
Google also competes with Apple, but signing up with Google’s cloud service would at least diminish Amazon’s hold on key Apple operations, and greatly boost a relative upstart in the cloud.
A Barclays research note says that if the CRN report is true, “signing Apple as a client would be another banner case study” for Google, which recently acquired the business of Spotify, a high-profile music streaming service much touted by AWS as a client.
Netflix, which last month announced it had completed its migration to the AWS cloud, will have a panelist at Google’s first-ever cloud conference next week in San Francisco.
Analysts with Morgan Stanley said in a research note Thursday that “any endorsement” or adoption from Netflix of Google’s platform would help buttress its credibility as an AWS competitor.