Google lures Verizon away from Microsoft for cloud services, enhances competitive business services profile

Google HQ building

By stealing Verizon away from Microsoft as a storage services customer, Google is enhancing its profile in the cloud services market that’s been dominated by Amazon and Microsoft.

Verizon has migrated over 150,000 of its employees to Google’s G Suite product.

Citing a person familiar with the agreement, a Bloomberg report revealed that before it worked with Google Verizon had been using Microsoft’s Office app suite.

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Microsoft did not provide Bloomberg an immediate comment on its Verizon contract.

But Verizon is just one of several new high profile customers Google signed up for its cloud service offerings.

During a Google event held in San Francisco on Wednesday, the company also named Colgate-Palmolive Co., HSBC Holdings and EBay. 

“Cloud is just a transformational technology,” said Diane Greene, SVP for Google's cloud business, during the event. “It’s increasingly what is giving our customers their competitive advantage.”

Being able to highlight these new customer wins illustrates Google’s efforts to increase its business customer revenue share, which has been a key focus when Greene was tapped to head up the cloud division.

While Google does not publicly share its cloud revenues, Greene told attendees that half of its contract wins come when it goes up against Amazon Web Services (AWS) and Microsoft. A number of Google’s customers said that they also purchase cloud services from the company’s competitors.

Google certainly has its work cut out for itself in competing against AWS.

A fourth quarter Synergy Research Group report shows that AWS is maintaining its dominant share of the emerging public cloud services market at over 40%.  Meanwhile, the three main chasing cloud providers—Microsoft, Google and IBM—are taking share but at the expense of smaller players in the market.

Synergy said that in aggregate the three have increased their worldwide market share by almost five percentage points over the last year and together now account for 23% of the total public infrastructure as a service (IaaS) and platform as a service (PaaS) market due to strong growth at Microsoft and Google.

“While a few cloud providers are growing at extraordinary rates, AWS continues to impress as a dominant market leader that has no intention of letting its crown slip,” said John Dinsdale, a chief analyst and research director at Synergy Research Group, in a release. “Achieving and maintaining a leadership position in this market takes huge ongoing investments in infrastructure, a continued expansion in the range of cloud services offered, strong credibility with the large enterprise sector, consistently strong execution, and the wholehearted and long-term backing of senior management.”