Google: We’re One of the World’s Largest Hardware Makers
Google is a web company, and it rakes in most of its money from online ad sales, but it has another identity that few people understand: It’s also a massive hardware maker.
For years, the company has designed the servers, networking gear, and perhaps other hardware that helps drive its many web services. Google is pretty secretive about its hardware work — the company sees it as a competitive advantage — but at Google’s annual stockholder meeting Chief Financial Officer Patrick Pichette actually spelled it out. He called his company “probably” one of the world’s largest hardware makers.
He was trying to convince investors that Google had the hardware chops to succeed with its $12.5 billion acquisition of mobile-phone-maker Motorola. “There’s a bit of a mythology that Google doesn’t know anything about hardware,” he said. “We’re big in hardware. Google actually builds servers in a factory that actually probably makes us one of the largest hardware manufacturers in the world. And so we know hardware. We know about flash. We know about equipment. We know about supply chain. So we were very well-equipped from the hardware side, to be very competitive in that space.”
Google’s story presents a bit of a paradox for server makers such as Dell and HP, and even networking giants Cisco and Juniper, who risk being left behind in the rush toward cloud computing. If customers move to the cloud, will they end up switching to custom-made gear?
Google won’t name any of its server-making partners, but according to the Taipei Times, Google’s servers are built by Quanta Computer. Another partner is memory chip maker Nanya Technology, the paper reports.
Virtually everyone running a large data center is thought to be at least considering a move to ODMs, but because the industry analyst firms that track server sales get most of the data from the big server vendors, it’s hard to say how big this market really is.
On Friday, Quanta’s web site advertized an engineering job with the company building systems for Google, Yahoo, and eBay.
Quanta lists Google, Yahoo and eBay as server customers. Image: Google Translate
Google, for its part, won’t confirm the names of any of its suppliers. Back in April, the company opened a data center in Taiwan, saying that it wanted to advance cloud computing and other technologies in the region. But it wouldn’t confirm who was actually building the servers. “We custom design our facilities, working with a number of suppliers and partners in Taiwan, and around the world.”
But thanks to Pichette, we now know that this is big business indeed.
And that makes sense. Google spent about $3.4 billion on capital expenditures last year, and a large chunk of that went to the x86 servers that run its data centers. To put that in perspective, number-four X86 server vendor Fujitsu sold $1.3 billion worth of servers in 2011, according to research firm Gartner.
For years, the company has designed the servers, networking gear, and perhaps other hardware that helps drive its many web services. Google is pretty secretive about its hardware work — the company sees it as a competitive advantage — but at Google’s annual stockholder meeting Chief Financial Officer Patrick Pichette actually spelled it out. He called his company “probably” one of the world’s largest hardware makers.
He was trying to convince investors that Google had the hardware chops to succeed with its $12.5 billion acquisition of mobile-phone-maker Motorola. “There’s a bit of a mythology that Google doesn’t know anything about hardware,” he said. “We’re big in hardware. Google actually builds servers in a factory that actually probably makes us one of the largest hardware manufacturers in the world. And so we know hardware. We know about flash. We know about equipment. We know about supply chain. So we were very well-equipped from the hardware side, to be very competitive in that space.”
Google’s story presents a bit of a paradox for server makers such as Dell and HP, and even networking giants Cisco and Juniper, who risk being left behind in the rush toward cloud computing. If customers move to the cloud, will they end up switching to custom-made gear?
Quite possibly.
Google, like other big data center operators, is designing its own boxes and going straight to the Taiwanese and Chinese companies that build servers for HP, Dell, and IBM and getting them built for less. In other words, they’re cutting out the middleman by going to these Asian original device manufacturers (ODMs).Google won’t name any of its server-making partners, but according to the Taipei Times, Google’s servers are built by Quanta Computer. Another partner is memory chip maker Nanya Technology, the paper reports.
Virtually everyone running a large data center is thought to be at least considering a move to ODMs, but because the industry analyst firms that track server sales get most of the data from the big server vendors, it’s hard to say how big this market really is.
On Friday, Quanta’s web site advertized an engineering job with the company building systems for Google, Yahoo, and eBay.
Quanta lists Google, Yahoo and eBay as server customers. Image: Google Translate
Google, for its part, won’t confirm the names of any of its suppliers. Back in April, the company opened a data center in Taiwan, saying that it wanted to advance cloud computing and other technologies in the region. But it wouldn’t confirm who was actually building the servers. “We custom design our facilities, working with a number of suppliers and partners in Taiwan, and around the world.”
But thanks to Pichette, we now know that this is big business indeed.
And that makes sense. Google spent about $3.4 billion on capital expenditures last year, and a large chunk of that went to the x86 servers that run its data centers. To put that in perspective, number-four X86 server vendor Fujitsu sold $1.3 billion worth of servers in 2011, according to research firm Gartner.
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