Powered by CEO Thomas Kurian’s passionate commitment to build for the future rather than compete for the past, Google Cloud has become the world’s most powerful and influential cloud and AI provider and has ascended to the #1 spot on the Cloud Wars Top 10.
It has been a remarkable and relentlessly upward journey for Google Cloud. When I launched the Cloud Wars Top 10 rankings exactly nine years ago, Google Cloud debuted in the #9 spot. But, with the recruitment of Kurian two years later, the company immediately undertook an intense transformation from what was a world-class R&D lab largely detached from the business world to a customer-obsessed business-innovation powerhouse whose products, ecosystem, and go-to-market capabilities helped customers across industries and around the world do things never before possible.
In claiming the #1 position, Google Cloud has displaced Microsoft, which held that top spot for four years while becoming by far the world’s largest cloud vendor. Meanwhile, Oracle — formerly #3 on the Cloud Wars Top 10 — has also leapfrogged Microsoft and now holds the #2 spot in spite of Microsoft’s cloud revenue being 7X larger than Oracle’s.
The magnitude of these shifts prompted me to sit down for a chat with John Siefert, CEO, Cloud Wars and Dynamic Communities. Watch our in-depth video analysis, the first in a two-episode series. (The second episode will run tomorrow.)
Because, while size definitely matters in my evaluations for the Cloud Wars Top 10, the predominant factor is a vendor’s ability to provide the solutions and mindset that allow customers to create their own futures in the AI Economy: to grow, optimize operations, engage more intimately with customers, imagine and execute powerful new business models, attract world-class talent, and move at the speed of customers.
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So, despite Microsoft’s extraordinary revenue reach in the market — its cloud business generates $500 million in revenue every single day, seven days a week — I have decided to move Microsoft down to the #3 spot on the Cloud Wars Top 10 because both #1 Google Cloud and #2 Oracle have overtaken it in their abilities to help customers succeed in the AI Economy. And, over the next couple of weeks, I’ll go into significant detail in analyzing each of those moves and the outlooks for each of those companies.
But for now, I want to return to the world’s new #1 player in cloud and AI.
The keys behind Google Cloud’s relentless ascent span a range of elements essential for helping customers succeed and grow and innovate in the most disruptive time in human history:
- Understanding customers’ unique goals, challenges, and environments: Back in 2019, Kurian became the first tech-industry CEO to use the term “customer empathy” and his insistence on that mindset throughout the Google Cloud organization has been essential to the company’s remarkable growth.
- Rising revenue as the ultimate expression of customer demand: For the past 10 quarters, Google Cloud has been at or very close to the top of the Cloud Wars Growth Charts. Customers today have an extraordinary range of highly qualified cloud and AI vendors from which to choose —and that fact that Google Cloud’s revenue growth has frequently accelerated even as its revenue base has grown larger is an indisputable factor in its ascent to the #1 spot.
- Getting into security before security was cool: Four years ago, when Google Cloud acquired threat-intelligence specialist Mandiant, many “experts” were flabbergasted — ‘what the hell does security have to do with cloud infrastructure?’ they squealed. Google Cloud has continued to aggressively expand its security capabilities — most recently with the acquisition of Wiz — and that has become a strategic differentiator in the minds of customers. By contrast, I believe strongly that the exposure in early 2024 of Microsoft’s shocking security shortcomings have raised huge questions in the minds of corporate customers who view world-class cybersecurity as unconditional table stakes. For more on that, please see “Microsoft Cybersecurity Disaster Triggers Customer Doubt, Competitor Opportunity.”
- Rapid and massive buildout of enterprise-strength AI products and services: Centered on Gemini Enterprise, the Google Cloud AI portfolio extends deeply into developers with Vertex AI, into agentic applications via Google Cloud Applied AI, and an open architecture that is second to none. In combination with Google Cloud’s complete cloud stack, its top-to-bottom AI stack gives enterprise customers maximum flexibility, choice, and opportunity as they bet their companies on aligning with the right partner.
- Ecosystem program — and culture — that’s second to none: Under the leadership of Kevin Ichhpurani, Google Cloud has built a global ecosystem organization that’s been a huge growth-driver over the past several years, and the company has not missed a beat in weaving its AI offerings and programs across that partner network.
Final Thoughts
During Microsoft’s four-year reign atop the Cloud Wars Top 10, I sometimes referred to Microsoft having a “stranglehold” on the top spot, and more than once noted that while nobody owns first place, it would take a remarkable effort for someone to come along and displace Satya Nadella as the #1 player.
Well, that remarkable outcome has happened — and while Google Cloud’s quarterly revenue of $15.2 billion is not even one-third of Microsoft Cloud’s $49.1 billion, size might be a thing but it is surely not the only thing.
Over the next few weeks, I’ll be sharing deeper insights on why I’ve put Google Cloud at #1, Oracle at #2, and Microsoft at #3 — and I’ll also be laying out some other Cloud Wars Top 10 developments including but not limited to the new ranking for AWS (it has tumbled from its former spot at #4), a huge jump by Palantir, SAP’s move from #5 to #4, and OpenAI’s debut on the Cloud Wars Top 10.
Well done, Google Cloud and Oracle!
