Google Cloud infrastructure head Urs Hölzle stepping down

Urs Hölzle began working for Google in 1999 at a time when people were using Yahoo and Alta Vista to search the internet. As Google grew in popularity over the years, he moved through the ranks. Most recently he has been running infrastructure for Google Cloud, reporting directly to CEO Thomas Kurian, but today the company confirmed reports that Hölzle was stepping away from his executive role.

Hölzle, who was employee number 8 at Google, won’t be leaving the company, however. Instead, he’ll be moving into an individual contributor role where he’ll be a Google Fellow, an individual research role at the company.

It’s quite a shock for someone with Hölzle’s unique understanding of the company to be stepping away from the infrastructure role he held for so long. Ray Wang, founder and principal analyst at Constellation Research says Hölzle was a key figure at the company, and through his vast experience was kind of the glue between Google and Google Cloud.

“He helped with marshaling the forces within Google to make the transition from niche cloud to enterprise class cloud. Being the 8th employee he’s been wanting to explore new ideas and get back to innovation,” Wang told TechCrunch. Being in the Fellow role should help enable him to do that.

But moving from a leadership role to an individual contributor will very likely have an impact on Google Cloud. “He’s done a good job helping the engineering teams understand what a product-led culture looks like, as opposed to the rest of Google which does not have the engineering discipline enterprises expect from their vendors,” Wang said.

As he moves on, Hölzle will be replaced by Chris Vonderhaar, who spent 13 years at AWS in various data center operations roles. Before stepping down quite suddenly last month, he held the title of VP of AWS Data Center Community where he was responsible for the design, planning, construction and operations of the AWS data centers, according to his LinkedIn profile. While he’s stepping into big shoes, Vonderhaar is no slouch having spent well over a decade helping build infrastructure for AWS.

At Google, Vonderhaar’s title will be vice president of demand and supply management, a curious title to be sure, but one where he should be able to put his vast experience to work helping replace Hölzle’s knowledge running the company’s infrastructure.

Google Cloud infrastructure head Urs Hölzle stepping down by Ron Miller originally published on TechCrunch

Google is acquiring security intelligence firm Mandiant for $5.4B

At a time when cyber security is top of mind for many firms, Google announced it was paying $5.4 billion to acquire security intelligence company Mandiant, giving it access to security data gathering capabilities, as well as a team of hundreds of security consultants. The company will become part of Google Cloud upon closing.

Google Cloud head Thomas Kurian pointed out that companies were facing unprecedented security threats, especially as the war in Ukraine rages, and Mandiant gives the company a platform of security services to add to the Google Cloud platform.

“This is an opportunity to deliver an end-to-end security operations suite and extend one of the best consulting organizations in the world. Together we can make a profound impact in securing the cloud, accelerating the adoption of cloud computing and ultimately make the world safer,” Kurian said in a statement.

The company plans to pay Mandiant $23 a share, representing a 57% premium over the 10 day weighted stock price average. The stock is up almost 18% over the last year and took a nice spike in the last couple of days as rumors began to surface about a possible deal.

Patrick Moorhead, founder and principal analyst at Moor Insights & Strategy says that the deal should improve and expand Google’s existing strong security stance. “Google Cloud has always had a good reputation for security offerings inside of its own cloud. The Mandiant acquisition opens the aperture to any cloud or on premise configuration,” Moorhead told me.

Gartner analyst Neil MacDonald, who watches the cloud security space carefully, agrees pointing out that when combined with the acquisition of Siemplify earlier this year, it is building a strong security business. “After Google’s recent acquisition of Siemplify for security orchestration automation and response (SOAR), the Mandiant acquisition is another clear signal that Google is serious about growing revenue in its security division – which is a part of the Google Cloud business unit,” MacDonald explained.

He added that the acquisition should enhance the company’s security argument, especially for potential customers who may still worry about securing workloads in the cloud. “By improving its security capabilities and brand awareness as a security vendor, Google also benefits by helping to remove security as an inhibitor to the adoption of GCP,” he said.

Mandiant launched in 2004 and raised $70 million along the way, according to Crunchbase data. The company was sold to FireEye in 2013 for $1 billion. Last year the two companies split with FireEye being sold to a private equity consortium led by Symphony Technology Group for $1.2 billion.

At the time company founder Kevin Mandiant, who had become FireEye CEO, said the deal was designed to unlock the value of Mandiant as a stand-alone business. It certainly fetched a much heftier price than FireEye did.

Mandiant took the position of many an acquired company, saying that the deal gave his company access to the scale and resources of Google Cloud. “Together, we will deliver our expertise and intelligence at scale via the Mandiant Advantage SaaS platform, as part of the Google Cloud security portfolio,” he said in a statement announcing the deal.

Before it gets to the finish line, the transaction will have to run the regulatory gauntlet and garner Mandiant stockholder approval. The companies are predicting a close date some time later this year.

Google Cloud teams up with NLP startup Cohere on multiyear partnership around TPUs

Google Cloud announced a multiyear partnership with Cohere, an early-stage startup that is building a natural language processing platform to make it easier for developers to build natural language processing models into applications. The solution requires a fair amount of infrastructure resources to pull off, and Google Cloud Platform (GCP) is going to provide them under the terms of this deal.

The two companies are also planning a go-to-market effort together, giving Cohere a big lift as a startup to help jumpstart usage and sales with the power of the GCP sales team.

Google Cloud CEO Thomas Kurian said that Cohere offers a great use case for Google Cloud Tensor Processing Unit (TPUs) chips that builds on work Google has been doing in-house.

“First of all, this is a perfect example of a technology that we built at Google for our own use, these high-scale TPUs. We’re now making them available in the cloud to other platform companies,” Kurian told me. “But here is an example [with Cohere] where they find that the ability to use and build models and train them on TPUs provides them very differentiated capability.”

Aidan Gomez, co-founder and CEO at Cohere, who previously worked at Google Brain, said his company is trying to build an NLP solution that makes all of this advanced technology available to any developer. “We scrape the data to train these big models, we train them on massive TPU pods, and we optimize them because they’re extremely large, and want them to fit the latency tolerances of pretty much any production system,” Gomez explained.

He said that by optimizing the workloads, Cohere can open up access to all of this advanced technology, enabling developers to access the models and start building NLP-based solutions based on the models that Cohere is providing. Kurian said that he is starting to see this shift from the text-based UI to one that’s more driven by natural language interactions, and Cohere is a good example of how to make this happen.

“If you look at the state of the art, the way that the vast majority of people use computers is through graphical user interfaces or screens. I don’t think that people want to experience computers through just one sense, which is the sense of sight,” Kurian said. “They want to interact with computers in more ways and they want to interact in more natural ways. So language is the next big phase of evolution of the way that people interact with systems.”

It’s not every day that you see the CEO of one of the big three cloud platforms get on a call to discuss a partnership with a startup, but Kurian believes this is a particularly compelling and creative example of TPU usage. “If you actually use the Cohere technology, you will find that it works very elegantly because of the combination of the software that Aidan’s team has built and the computational infrastructure that TPUs provide.”

Cohere was founded in 2019 by Gomez, Nick Frosst and Ivan Zhang in Toronto. The company has raised $40 million from Index Ventures, Radical Ventures, Section 32, and a who’s who of industry AI angels including Geoffrey Hinton and Fei-Fei Li, among others.

Google Cloud launches a new support option for mission critical workloads

Google Cloud today announced the launch of a new support option for its Premium Support customers that run mission-critical services on its platform. The new service, imaginatively dubbed Mission Critical Services (MCS), brings Google’s own experience with Site Reliability Engineering to its customers. This is not Google completely taking over the management of these services, though. Instead, the company describes it as a “consultative offering in which we partner with you on a journey toward readiness.”

Initially, Google will work with its customers to improve — or develop — the architecture of their apps and help them instrument the right monitoring systems and controls, as well as help them set and raise their service-level objectives (a key feature in the Site Reliability Engineering philosophy).

Later, Google will also provide ongoing check-ins with its engineers and walk customers through tune-ups architecture reviews. “Our highest tier of engineers will have deep familiarity with your workloads, allowing us to monitor, prevent, and mitigate impacts quickly, delivering the fastest response in the industry. For example, if you have any issues–24-hours-a-day, seven-days-a-week–we’ll spin up a live war room with our experts within five minutes,” Google Cloud’s VP for Customer Experience, John Jester, explains in today’s announcement.

This new offering is another example of how Google Cloud is trying to differentiate itself from the rest of the large cloud providers. Its emphasis today is on providing the high-touch service experiences that were long missing from its platform, with a clear emphasis on the needs of large enterprise customers. That’s what Thomas Kurian promised to do when he became the organization’s CEO and he’s clearly following through.


Databricks brings its lakehouse to Google Cloud

Databricks and Google Cloud today announced a new partnership that will bring to Databricks customers a deep integration with Google’s BigQuery platform and Google Kubernetes Engine. This will allow Databricks’ users to bring their data lakes and the service’s analytics capabilities to Google Cloud.

Databricks already features a deep integration with Microsoft Azure — one that goes well beyond this new partnership with Google Cloud — and the company is also an AWS partner. By adding Google Cloud to this list, the company can now claim to be the “only unified data platform available across all three clouds (Google, AWS and Azure).”

It’s worth stressing, though, that Databricks’ Azure integration is a bit of a different deal from this new partnership with Google Cloud. “Azure Databricks is a first-party Microsoft Azure service that is sold and supported directly by Microsoft. The first-party service is unique to our Microsoft partnership. Customers on Google Cloud will purchase directly from Databricks through the Google Cloud Marketplace,” a company spokesperson told me. That makes it a bit more of a run-of-the-mill partnership compared to the Microsoft deal, but that doesn’t mean the two companies aren’t just as excited about it.

“We’re delighted to deliver Databricks’ lakehouse for AI and ML-driven analytics on Google Cloud,” said Google Cloud CEO Thomas Kurian (or, more likely, one of the company’s many PR specialists who likely wrote and re-wrote this for him a few times before it got approved). “By combining Databricks’ capabilities in data engineering and analytics with Google Cloud’s global, secure network—and our expertise in analytics and delivering containerized applications—we can help companies transform their businesses through the power of data.”

Similarly, Databricks CEO Ali Ghodsi noted that he is “thrilled to partner with Google Cloud and deliver on our shared vision of a simplified, open, and unified data platform that supports all analytics and AI use-cases that will empower our customers to innovate even faster.”

And indeed, this is clearly a thrilling delight for everybody around, including customers like Conde Nast, whose Director of Data Engineering Nana Essuman is “excited to see leaders like Google Cloud and Databricks come together to streamline and simplify getting value from data.”

If you’re also thrilled about this, you’ll be able to hear more about it from both Ghodsi and Kurian at an event on April 6 that is apparently hosted by TechCrunch (though this is the first I’ve heard of it, too).

Google Cloud lost $5.6B in 2020

Google continues to bet heavily on Google Cloud, and, while it is seeing accelerated revenue growth, its losses are also increasing. For the first time today, Google disclosed operating income/loss for its Google Cloud business unit in its quarterly earnings today. Google Cloud lost $5.6 billion in Google’s fiscal year 2020, which ended December 31. That’s on $13 billion of revenue.

While this may look a bit dire at first glance (cloud computing should be pretty profitable, after all), there are different ways of looking at this. On the one hand, losses are mounting, up from $4.3 billion in 2018 and $4.6 billion in 2019, but revenue is also seeing strong growth, up from $5.8 billion in 2018 and $8.9 billion in 2019. What we’re seeing here, more than anything else, is Google investing heavily in its cloud business.

Google’s Cloud unit, led by its CEO Thomas Kurian, includes all of its cloud infrastructure and platform services, as well as Google Workspace (which you probably still refer to as G Suite). And that’s exactly where Google is making a lot of investments right now. Data centers, after all, don’t come cheap, and Google Cloud launched four new regions in 2020 and started work on others. That’s on top of its investment in its core services and a number of acquisitions.

“On cloud, we see how early customers are in this shift,” Google/Alphabet CEO Sundar Pichai said in today’s earnings call. “We see a large time ahead — and definitely the market dynamics and our momentum in the context of the market is the framework in which we are thinking about the scale of investments — and the pace of investments. Obviously, it’s an area in which the longer you are in, the [unintelligible] and contributes more — and economies of scale start working as well. But we are definitely investing ahead to make sure we are able to be able to serve the customers globally across all the offerings they are interested in.”

Image Credits: Google

“Our strong fourth quarter performance, with revenues of $56.9 billion, was driven by Search and YouTube, as consumer and business activity recovered from earlier in the year,” Ruth Porat, CFO of Google and Alphabet, said. “Google Cloud revenues were $13.1 billion for 2020, with significant ongoing momentum, and we remain focused on delivering value across the growth opportunities we see.”

In today’s earnings call, Porat noted that Workspace is seeing strong growth among large enterprises, “which are signing meaningful, long-term commitment agreements.”

For now, though, Google’s core business, which saw a strong rebound in its advertising business in the last quarter, is subsidizing its cloud expansion.

Meanwhile, over in Seattle, AWS today reported revenue of $12.74 billion in the last quarter alone and operating income of $3.56 billion. For 2020, AWS’s operating income was $13.5 billion.

Ford bets on Google Cloud for its digital transformation

Google and Ford today announced a new partnership around bringing Android Automotive to Ford’s Ford- and Lincoln-branded cars, starting in 2023. But at the same time, the two companies also announced that Ford has chosen Google Cloud as its preferred cloud provider.

“With Google Cloud, Ford will digitally transform from the front office to the car to the manufacturing plant floor,” Google Cloud CEO Thomas Kurian said in a press conference today. “And there are a number of different applications, including modernizing product development, improving manufacturing and supply chain management, using computer vision AI for employee training, inspection of equipment on the assembly line and other applications.”

Kurian also noted that Google and Ford are working to find new ways to monetize Ford’s data through features like maintenance requests and trade-in alerts.

“At Ford, we’ve got world-class in-house data insights and analytics teams,”  David McClelland, Ford’s VP for strategy and partnerships, said. “We’ve recruited significant software expertise and we’re making great progress in this area. And we’re moving rapidly towards commercializing our new self-driving business. And with this news that Thomas [Kurian] and I are announcing today, we’re turbocharging all of that.”

McClelland stressed that Google “brought the entire company to the table for us across cloud, Android, Maps and much more.” It’s maybe also no surprise, given Google’s expertise in this area, that for is looking to leverage Google Cloud’s AI tools as well. This work will go beyond the actual driving experience, too, and include work on modernizing Ford’s product development, manufacturing and supply chain, as well as predictive maintenance in Ford’s plants.

Like other car manufacturers, Ford is also looking to find ways to use the data it collects to create a connection to its drivers that goes beyond the buying experience and (maybe) the occasional maintenance visit to a dealership. For this to work, it needs to be able to understand its customers and offer personalized experiences.

Today’s announcement marks a bit of a turnaround for Ford, which had previously banded together with a group of other car manufacturers with the explicit goal of keeping Google’s role in the automotive industry to a minimum. Now, only a few years later, the two are coming together in one of the deeper partnerships in the industry.

It’s also worth mentioning, that not too long ago, Ford had a deep partnership with Microsoft, which provided the basis of Ford’s Sync technology.

“From the first moving assembly line to the latest driver-assist technology, Ford has set the pace of innovation for the automotive industry for nearly 120 years,” said Sundar Pichai, CEO of Google and Alphabet. “We’re proud to partner to apply the best of Google’s AI, data analytics, compute and cloud
platforms to help transform Ford’s business and build automotive technologies that keep people safe and connected on the road.”

Canalys: Google is top cloud infrastructure provider for online retailers

While Google Cloud Platform has shown some momentum in the last year, it remains a distant third behind Amazon and Microsoft in the cloud infrastructure market. But Google got some good news from Canalys today when the firm reported that GCP is the number one cloud platform provider for retailers.

Canalys didn’t provide specific numbers, but it did set overall market positions in the retail sector with Microsoft coming in second, Amazon third, followed by Alibaba and IBM in fourth and fifth respectively.

Canalys cloud infrastructure retail segment market share numbers

Image Credits: Canalys

It’s probably not a coincidence that Google went after retail. Many retailers don’t want to put their cloud presence onto AWS, as competes directly with these retailers. Brent Leary, founder and principal analyst at CRM Essentials, says that as such, the news doesn’t really surprise him.

“Retailers have to compete with Amazon, and I’m guessing the last thing they want to do is use AWS and help Amazon fund all their new initiatives and experiments that in some cases will be used against them,” Leary told TechCrunch. Further, he said that many retailers would also prefer to keep their customer data off of Amazon’s services.

Canalys Senior Director Alex Smith says that this Amazon effect combined with the pandemic and other technological factors has been working in Google’s favor, at least in the retail sector. “Now more than ever, retailers need a digital strategy to win in an omnichannel world, especially with Amazon’s online dominance. Digital is applied everywhere from customer experience to cost optimization, and the overall technological capability of a retailer is what will define its success,” he said.

COVID-19 has forced many retailers to close stores for extended periods of time, and when you combine that with people being more reluctant to go inside stores when they do open, retailers have had to take a crash course in eCommerce if they didn’t have a significant online presence already.

Canalys points out that Google has lured customers with its advertising and search capabilities beyond just pure infrastructure offerings, taking advantage of its other strengths to grow the market segment.

Recognizing this, Google has been making a big retail push including a big partnership with Salesforce and specific products announced at Google Cloud Next last year. As we wrote at the time of the retail offering,

The company offers eCommerce Hosting, designed specifically for online retailers, and it is offering a special premium program, so retailers get “white glove treatment with technical architecture reviews and peak season operations support…” according to the company. In other words, it wants to help these companies avoid disastrous, money-losing results when a site goes down due to demand.

What’s more, Canalys reports that Google Cloud has also been hiring aggressively and forming partnerships with big systems integrators to help grow the retail business. Retail customers include Home Depot, Kohl’s, Costco and Best Buy.

Google signs up Verizon for its AI-powered contact center services

Google today announced that it has signed up Verizon as the newest customer of its Google Cloud Contact Center AI service, which aims to bring natural language recognition to the often inscrutable phone menus that many companies still use today (disclaimer: TechCrunch is part of the Verizon Media Group). For Google, that’s a major win, but it’s also a chance for the Google Cloud team to highlight some of the work it has done in this area. It’s also worth noting that the Contact Center AI product is a good example of Google Cloud’s strategy of packaging up many of its disparate technologies into products that solve specific problems.

“A big part of our approach is that machine learning has enormous power but it’s hard for people,” Google Cloud CEO Thomas Kurian told me in an interview ahead of today’s announcement. “Instead of telling people, ‘well, ‘here’s our natural language processing tools, here is speech recognition, here is text-to-speech and speech-to-text — and why don’t you just write a big neural network of your own to process all that?’ Very few companies can do that well. We thought that we can take the collection of these things and bring that as a solution to people to solve a business problem. And it’s much easier for them when we do that and […] that it’s a big part of our strategy to take our expertise in machine intelligence and artificial intelligence and build domain-specific solutions for a number of customers.”

The company first announced Contact Center AI at its Cloud Next conference two years ago and it became generally available last November. The promise here is that it will allow businesses to build smarter contact center solutions that rely on speech recognition to provide customers with personalized support while it also allows human agents to focus on more complex issues. A lot of this is driven by Google Cloud’s Dialogflow tool for building conversational experiences across multiple channels.

“Our view is that AI technology has reached a stage of maturity where it can be meaningfully applied to solving business problems that customers face,” he said. “One of the most important things that companies need is to differentiate the customer experience through helpful and convenient service — and it has never been more important, especially during the period we’re all in.”

Not too long ago, bots — and especially text-based bots — went through the trough of disillusionment, but Kurian argues that we’ve reached a very different stage now and that these tools can now provide real business value. What’s different now is that a tool like Contact Center AI has more advanced natural language processing capabilities and is able to handle multiple questions at the same time and maintain the context of the conversation.

“The first generation of something called chatbots — they kind of did something but they didn’t really do much because they thought that all questions can be answered with one sentence and that human beings don’t have a conversation,” he noted and also added that Google’s tools are able to automatically create dialogs using a company’s existing database of voice calls and chats that have happened in the past.

When necessary, the Contact Center AI can automatically hand the call off to a human agent when it isn’t able to solve a problem but another interesting feature is its ability to essentially shadow the human agent and automatically provide real-time assistance.

“We have a capability called Agent Assist, where the technology is assisting the agent and that’s the central premise that we built — not to replace the agent but assist the agent.”

Because of the COVID-19 pandemic, more companies are now accelerating their digital transformation projects. Kurian said that this is also true for companies that want to modernize their contact centers, given that for many businesses, this has now become their main way to interact with their customers.

As for Verizon, Kurian noted that this was a very large project that has to handle very high call volumes and a large variety of incoming questions.

“We have worked with Verizon for many, many years in different contexts as Alphabet and so we’ve known the customer for a long time,” said Kurian. “They have started using our cloud. They also experimented with other technologies and so we sort of went in three phases. Phase One is to get a discussion with the customer around the use of our technology for chat, then the focus is on saying you shouldn’t just do chat, you should do chat and voice on a common platform to avoid the kind of thing where you get one response online and a different response when you call. And then we’ve had our engineers working with them — virtually obviously, not physically.”

He noted that Google has seen quite a bit of success with Contact Center AI in the telco space, but also among government agencies, for example, especially in Europe and Asia. In some verticals like retail, he noted, Google Cloud’s customers are mostly focused on chat, while the company is seeing more voice usage among banks, for example. In the telco business, Google sees both across its customers, so it probably made sense for Verizon to bet on both voice and chat with its implementation.

“Verizon’s commitment to innovation extends to all aspects of the customer experience,” said Verizon global CIO and SVP Shankar Arumugavelu in today’s announcement. “These customer service enhancements, powered by the Verizon collaboration with Google Cloud, offer a faster and more personalized digital experience for our customers while empowering our customer support agents to provide a higher level of service.”

Thomas Kurian on his first year as Google Cloud CEO


That was Google Cloud CEO Thomas Kurian’s simple answer when I asked if he thought he’d achieved what he set out to do in his first year.

A year ago, he took the helm of Google’s cloud operations — which includes G Suite — and set about giving the organization a sharpened focus by expanding on a strategy his predecessor Diane Greene first set during her tenure.

It’s no secret that Kurian, with his background at Oracle, immediately put the entire Google Cloud operation on a course to focus on enterprise customers, with an emphasis on a number of key verticals.

So it’s no surprise, then, that the first highlight Kurian cited is that Google Cloud expanded its feature lineup with important capabilities that were previously missing. “When we look at what we’ve done this last year, first is maturing our products,” he said. “We’ve opened up many markets for our products because we’ve matured the core capabilities in the product. We’ve added things like compliance requirements. We’ve added support for many enterprise things like SAP and VMware and Oracle and a number of enterprise solutions.” Thanks to this, he stressed, analyst firms like Gartner and Forrester now rank Google Cloud “neck-and-neck with the other two players that everybody compares us to.”

If Google Cloud’s previous record made anything clear, though, it’s that technical know-how and great features aren’t enough. One of the first actions Kurian took was to expand the company’s sales team to resemble an organization that looked a bit more like that of a traditional enterprise company. “We were able to specialize our sales teams by industry — added talent into the sales organization and scaled up the sales force very, very significantly — and I think you’re starting to see those results. Not only did we increase the number of people, but our productivity improved as well as the sales organization, so all of that was good.”

He also cited Google’s partner business as a reason for its overall growth. Partner influence revenue increased by about 200% in 2019, and its partners brought in 13 times more new customers in 2019 when compared to the previous year.