A studio insider explains why Hollywood's arch enemy, Google, is about to win big business in hostile territory
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- Next month, Google Cloud is launching a new region in Los Angeles, the company said this week.
- Google, Amazon and Microsoft are competing for a potentially new lucrative source of business, the scores of production companies, film and animation studios in the area.
- One of the reasons the film and TV industries are eager to make the transition to the cloud is the success that Netflix has had since signing with Amazon's cloud in 2012, according to a film-industry source.
Back when YouTube and Google Search helped people find pirated films and TV shows and generally helped to lay waste to Hollywood's home-video market, it was hard to find anyone in the film or TV industries who would say anything good about the internet company.
Relations are warmer now. So much so that Google announced plans this week to launch a new cloud region in Los Angeles, specifically to sign up and service the thousands of production companies, animation houses and film studios.
Modern film and TV production requires the storage and handling of huge amounts of data, a job ideally suited for the brawny datacenters that Google, Amazon and Microsoft all operate.
But according to one studio executive that Business Insider spoke to, that's not why Google is bringing its cloud to Hollywood.
Elizabeth Fuentes/GettyNetflix CEO Reed HastingsThe real reason Google is Netflix. The world's most popular subscription streaming-video service has turned home entertainment on its head and has been in the cloud since 2012.
Now, all the other major media and entertainment companies, like Disney and Comcast, want to build their own version of Netflix. And to do that they need cloud computing - not for video production, but for video distribution.
"All these traditional media companies want to be (an on-demand service) like Netflix ," said the studio executive, who wished to remain anonymous. "The amount of money Netflix spends on cloud services is enormous."
It's a pot of gold tempting enough to lure Google into traditionally hostile territory.
Netflix is the best cloud advertisement that Amazon, Microsoft and Google have in Hollywood.
DisneyBefore Netflix, most of the big studios hired technologists and tried to keep everything in house. We once toured the tech area at Warner Bros. Studios and saw rows and rows of servers.
"That doesn't make a lot of sense anymore," the studio executive said. "The cloud is cheaper, faster, you get all kinds of storage. It's more secure and you no longer have the burden of maintaining security standards...I don't think Sony would have been hacked had they been in the cloud."
That's a reference to the famous 2014 incident in which Sony Pictures servers were infiltrated and sensitive material, including an unreleased feature film and personal emails belonging to major film stars, were published. The hack cost several top execs at the studio their jobs.
So, the entertainment industry is ready to move to the cloud but which of the top three cloud players will win?
If the Netflix-wannabes wish to follow that company's lead, they'll sign Amazon, Netflix's cloud provider.
Microsoft has enjoyed a good relationship with the film studios for decades and has operated a cloud region in Los Angeles for a while, according to TechCrunch.
But Google sees an opportunity to make inroads, despite the tense history it's had with the entertainment industry.
And according to the entrainment industry insider that BI spoke to, Google may be right. "Prior relationships don't matter," the source said. "What matters is cost and security. Microsoft was a great partner but if they don't meet the cost and security offers of the others, then they won't get the business. Yes, Google was considered evil but it won't matter if they offer the best cloud service."