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​So, Google is making big gains in Cloud

Cloud business builds on corporate innovation to accelerate adoption.

Adoption of Google’s Cloud business continues to accelerate, with Apps for Work and Cloud Platform businesses directly benefiting from Alphabet’s culture of innovation.

With global infrastructure expansion efforts underway and Cloud portfolio feature expansion, particularly in the realm of machine learning, a continual focus of growing engineering teams, Google’s Cloud revenue grew almost 62 percent to $US989 million in 2Q16 by analyst estimations.

Breaking Google’s Cloud business down, the portfolio consists of Google Apps for Work, for Education and for Government, as well as Google Cloud Platform, which is expected to expand over the $US1 billion mark in 3Q16.

“While advertising revenues dominate Alphabet’s revenues consistently, Google’s Cloud business continues to grow steadily,” Technology Business Research analyst, Meaghan McGrath, said.

For McGrath, machine learning remains core to product evolution and differentiation across the entire Google portfolio.

During the company’s earning call, CEO Sundar Pichai explained that more than 100 teams at Google are using machine learning, with this type of technology driving the company’s future in the years ahead.

In addition to energy efficiency improvements realised from applying DeepMind algorithms to Google datacentre operations, Google Cloud Platform (GCP) grew its machine learning capabilities for users’ development substantially across 1H16.

At the forefront of these innovations are Google’s multilingual Speech API and Cloud Natural Language API, which, in addition to its Vision API and Translate API, are designed to allow developers with predefined models that parse voice, text and image inputs to extract deeper information about the subject.

“However, while powerful in their pre-configuration and expansiveness of supporting data, these models cannot be based on data specific to enterprise applications,” McGrath said.

To address this gap, McGrath said Google also unveiled Cloud Machine Learning (Cloud ML), which allows users to build intelligent applications and predictive models using their own training data, and thus return tailored, enterprise-specific results.

“Cloud ML integrates with other GCP products, and can be supplemented with pre-trained models and other data from the TensorFlow machine learning library, and automatically ingests data and continues learning from new inputs,” McGrath explained.

In addition, Google introduced TensorFlow Processing Units (TPUs) in May, which are proprietary chips built specifically for accelerated machine learning processing and tailored for TensorFlow.

“Though just unveiled to users, these processing units have been in use at Google for more than a year, and will continue to increase the performance of GCP machine learning services as they gain greater traction in the market,” McGrath added.

Building functionality

In competition with other business productivity suites, Microsoft Office 365 in particular, McGrath said Google continues to build out functionality that will increase the competitiveness and differentiation of Google Apps for Work as it further penetrates the large enterprise market.

Recently launched features that add these capabilities include Google Springboard and a new User Hub, which enables users to search through all applications simultaneously, while also recommending relevant tasks and business information to users throughout the work day.

“The artificial intelligence-backed content recommendation and search capabilities will speed user navigation of files and add value as a type of workday assistant, catering to businesses’ needs,” McGrath observed.

“Once past the Early Adopter Program and made widely available, the instant accessibility of vital and current information will drive adoption of the Apps for Work portfolio by enterprises looking to improve efficiency and productivity, while having an easy-to-monitor daily guide of current activities.”

Microsoft, however, offers Office Delve, a feature similar to Google Springboard that provides a dashboard of current projects and documents being produced by connected users and enables users to search all of their files.

“The similarities between Delve and Springboard mean that Google's addition of this feature only supports competitiveness with Office, rather than elevating and differentiating Google’s productivity suite,” McGrath explained.

Conversely, the new User Hub, which was added in March, provides a landing page for users that shows all of the Google Apps turned on for that user in addition to any applications approved by the user’s admin or that may be of interest and are available for download.

While this feature does not necessarily improve a user’s daily efficiency, McGrath said it provides user self-service and relieves some IT communication stress.

“Seemingly small feature additions like this can still elevate Google Apps for Work’s enterprise appeal,” McGrath concluded.