Cloud Battle Moves to India

Google partners with mobile operator Airtel

The US and European markets have seen a three-horse race for supremacy in cloud services, with Microsoft Azure and Google Cloud trying to catch up to Amazon Web Services (AWS). Europe is Google’s fastest growing region, but the company has been a challenger in the US in particular, as AWS still controls much of the market thanks to its first-mover advantage.

But according to our latest IT decision-maker survey, this lead, although still pronounced, is diminishing. All the major cloud providers are vying for a piece of the Indian market as part of the global expansion of the industry. Google is also turning its attention to the country because this is quickly emerging as a major market for cloud customers. According to India’s software and services trade association, Nasscom, the country could pose a $7 billion market opportunity in the next couple of years.

This week, Google Cloud announced a new partnership with Indian telecom operator Airtel to offer its G Suite to small and medium businesses. G Suite is a set of intelligent apps — Gmail, Docs, Drive, Calendar and more — designed with real-time collaboration and machine intelligence to help people collaborate and work smarter and safer.

The latest agreement will provide a platform for both companies to tap growth opportunities in India, which ranks among the fastest growing economies and has the second highest number of Internet users in the world. With more than 500 million Internet users, the country is slowly adopting a more digital profile, with small businesses and merchants also beginning to use digital tools, storage services and accept online payments.

The move comes after Reliance Jio — India’s largest telecom operator with about 370 million customers — signed a similar deal with Microsoft to sell cloud services to small businesses. The two companies announced a 10-year partnership in August 2019 to “serve millions of customers”.

Amazon hasn’t partnered with any company for its cloud services in India, but last week, CEO Jeff Bezos announced while on a trip to the country that it will invest $1 billion into its India business to help about 10 million small and medium merchants come online.

It’s not just the big US cloud players that are looking to enter India to further their business interests. Chinese telecom operators are also looking at opportunities there, as their home market has saturated.

Earlier in 2020, China Mobile reportedly held early-stage talks with telecom service providers Airtel and Vodafone Idea to jointly develop a cloud network in India. China Mobile is the largest wireless operator in China, with more than 940 million mobile customers and 180 million wireline customers. It offers data services, wireless data traffic services, mobile data solutions, telecommunications network planning design and consulting services, as well as technology support. The operator has grown the cloud space in China, but as its home market has hit a plateau, it’s now scouting for investment opportunities overseas.

The Airtel deal is expected to help Google get a share of a fast growing market for cloud services. The move is also part of a growing wave of deals between the hyperscale cloud providers and telecom operators, as technologies like hybrid cloud, edge computing and 5G continue to converge. Take, for example, AWS’ deals with Verizon Business, KDDI, Vodafone and SK Telecom, and Microsoft’s agreement with AT&T.

The deal is also a big step for Airtel, which is looking to grow its own cloud business by using Google’s platform. The operator has been slowly building up its Airtel cloud platform, which it claims has about 2,500 large business and more than 500,000 small and medium businesses as its customers. The cloud wars in India are just beginning.