Tech giants fight to offer cloud service to companies of all sizes

Machine learning offered as well as storage

TORONTO • Cloud storage was once primarily thought of as a place to keep data online securely or to host a website, but some tech giants want more of their customers to think a lot more about what can be done with the data once it is put there — and, of course, to pay for services that manipulate it.

Large corporations have been using servers to store large amounts of data where it can be analyzed for trends or to predict results, but the cloud is also becoming useful for smaller organizations to quickly get much-needed results through machine learning and programs hosted within the cloud as well.

For example, a car insurance company could do instant on-site assessments: agents upload photos of an accident's damage through an app to the cloud where machine learning and artificial intelligence analyze them and quickly send back an approximate quote. That eliminates the need to return to the office where it could take hours or days to do an assessment.

Or a small medical office in a remote community may do a screening for diabetic retinopathy by uploading a photo of the patient's eye to a cloudbased machine-learning platform to get instant results instead of sending a patient away to a larger city for a proper diagnosis.

The demand for such applications and others that save time and bring in more revenue is growing and the tech giants want a piece of the action.

“Cloud is the great equalizer. It allows very small organizations to compete with very big organizations,” said Jim Lambe, Google Cloud's country manager for Canada. “Historically, the big organizations beat up on the small ones, but now it is the quicker organizations that are going to beat up on the slower ones.”

The worldwide public cloud services market is expected to grow by 18 per cent in 2017 to US$246.8 billion, according to a report this year by research company Gartner. By 2020, cloud adoption strategies are expected to influence more than 50 per cent of IT outsourcing deals.

Google has long harnessed the cloud for its own webbased services such as Gmail, YouTube and Google Docs, but the tech giant decided to double-down on the space after seeing the number of other companies that want their own cloud platforms to quickly grow.

Google said it considers itself one of the few that can properly lead the space given the high upfront cost for new entrants to develop the infrastructure, such as large data centres, needed to provide cloud storage.

“If you are not already an incumbent with the DNA to do this, you can't really enter this market because ... you companies like Box Inc. have been offering cloud storage solutions as well.

Amazon, Microsoft and Google in particular emphasize their computational and large-scale advantages rather than just their ability to securely host files.

Amazon is still the juggernaut with 40-per-cent market share as of February 2017, according to Synergy Research Group, but Microsoft is growing twice as fast.

Google is also ramping up its efforts now as well, having recently opened data centres in new international markets such as Canada, something Amazon and Microsoft were already doing (the latter still leads the way with a presence in 42 announced regions).

“Cloud is really driving the data centre expansion strategy for Google,” Stevens said. “Typically, there is a longer cycle for bringing up a new data centre, but now with cloud and, for example, with the company.

“The Waterloo office is a big contributor to the success of cloud ... and this is a really good place for us to be as we have really been looking for other ways to make a big contribution to Google, Canada and the world.”

Google's Montreal office also has engineers who work on cloud-related products (and others), but Waterloo's advantage is its proximity to the University of Waterloo, which is one of the schools that the tech giant recruits the most graduates from.

“Canada is well positioned as a big contributor in this space. People have heard a lot about the cloud and they don't really know exactly what it means,” Phillips said. “There is a lot of ways Canada can contribute here and one way is on the engineering side and being involved in what is developed, how these things come together and how it serves customers all around the world.”

The battle in the cloud is still in its early stages, but it is already fierce. Companies such as Google and Microsoft are playing catchup with Amazon, but say their platforms have more appeal because they are companies known for their machine learning, artificial intelligence and algorithms. Amazon, though the marketshare leader, isn't necessarily the first company that comes to mind for big data analysis.

Google also releases the source code to some of its cloud platforms for others to see, use and build upon, hoping to create a better end product and be recognized as a company that cares about the space, even if that means people take the code to a competitor's service.

The company said it is important to be welcomed in the open source community first and then business will follow.

“We could have just said we have the best machine learning technology and you can only use it on Google Cloud. Instead we said no, we are going to open it up,” Stevens said, adding that the response has been positive.

“That gets you to a place where it has long-term sustainable impact for the end user and for us.”