Shutterstock
Google Cloud CEO Thomas Kurian.
- Google Cloud CEO Thomas Kurian has said that he plans to become "at least the No. 2 cloud." To get there, the company will have to surpass Microsoft and close the gap with market-leading Amazon Web Services.
- Analysts expect making a big cloud acquisition will be the fastest way for Google to grow.
- Business Insider compiled a list below of 20 potential Google acquisition targets, according to analysts.
- Some of them are big and unlikely - including companies and businesses like Oracle Cloud, IBM Cloud, or Salesforce - while others point to Google Cloud's need to deepen its expertise in AI chips, cloud software, and other markets.
- Click here to read more BI Prime stories.
As Google Cloud tries to catch up to cloud-market leaders Amazon Web Services and Microsoft, analysts expect Google could make big cloud acquisitions this year to boost the business.
Google is significantly behind Amazon and Microsoft in the cloud computing business. Gartner most recently estimated AWS had a 47.8% market share in 2018, compared with Microsoft's 15.5% and Google's 4%. And Google's G Suite, which includes tools like Gmail and Google Docs, is very popular, with two billion monthly active users - but is far outmatched by Microsoft Office and the cloud-based Office 365 in the workplace.
But CEO Thomas Kurian, who took over Google Cloud in early 2019, has a plan to turn things around. According to a source who spoke with Business Insider in August, Kurian told employees Google Cloud has a five-year goal to become "at least the No. 2 cloud" and present a more serious threat to the leading AWS. It's already made notable progress, showing that it's on track to post $10 billion in revenue this year, with 53% year-over-year growth in the last quarter.
Part of that plan has involved acquisitions: Google last summer announced plans to buy data-analytics company Looker for $2.6 billion. Google in November also bought CloudSimple, once a crucial part of Microsoft's cloud ecosystem.
Analysts expect that there are likely more to come. Kurian was known for his aggressive acquisition strategy at Oracle, his previous employer, and they expect that he'll take a similar tactic to bolster Google Cloud and make it more appealing to larger customers - especially amid the current economic tumult, which could drag down startup and public company valuations alike.
"To catch up to AWS and Azure, the only way for Google to catch up is to make an acquisition. Big ones," Jeb Su, principal analyst at Atherton Technology Research, told Business Insider. "(Kurian) is probably looking now that the market has crashed and looking at much bigger acquisitions."
While Google Cloud is known for its artificial intelligence and data analytics capabilities, it needs to expand its product portfolio to keep pace with its leading cloud rivals, analyst Dan Ives of Wedbush has previously said.
"[Google Cloud Platform] is miles behind Microsoft and Amazon," Ives told Business Insider earlier this year. "Kurian & Co. need to acquire a cloud apps or infrastructure player to gain a toehold into this market."
Through that lens, there are a lot of different ways that Google Cloud could go, and analysts we spoke to have ideas - though some of their ideas would be a stretch, no matter how many zeroes are at the end of Google's bank balance. There's also no indication that any of these companies would even want to sell, or that Google has ever come calling.
Here are the 20 companies Google could consider buying to boosts its cloud business, according to analysts - and some are more likely than others: