Google and Thales form a JV to create a hyperscale sovereign cloud • The Register

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Google and the French defense and industry titan Thales have concocted an interesting arrangement that will see the latter create a sovereign version of the G-Cloud.

The two have created a joint venture in which Thales – a sprawling entity with interests in aerospace, defense, transport and energy – will hold a majority stake. Together, they will build a hyperscale cloud that uses Google’s cloud technology but does not touch any of the advertising giant’s physical infrastructure.

The result will be a cloud that behaves like the G-Cloud but, since it resides on French soil and Google does not control it, meets local government usage standards.

The cloud will be updated as Google evolves its own cloud, but Thales will inspect these changes before putting them into production. Thales will also deliver support from France.

Sovereign clouds aren’t new – many smaller providers have carved out a niche for themselves by emphasizing that they are not subject to the laws of other jurisdictions. Clouds for government users are also trivial – Google already has a share of its cloud for the US government, as do Microsoft and AWS.

But a joint venture to create a captive version of a public cloud platform is new.

Google’s cloud is well regarded but considered less comprehensive than Azure or AWS. The company also lacks the business roots, applications, and sales force that help Oracle build a business in the cloud. One of the tactics to grow the business would have been to cut back on finding substantial clients willing to make multi-year commitments.

Research goliath’s cloud computing efforts have produced torrents of red ink – $ 14.6 billion over the three years to 2021.

During the last quarter published by Google, Google announced strong growth in its cloud: the second quarter of 2021 saw the arrival of $ 4.6 billion in revenue, compared to $ 3 billion a year earlier.

Still, it recorded a loss of $ 591 million – a terrifying figure but well below the $ 1.43 billion lost in the corresponding quarter in 2020.

Google CEO Sundar Pichai also suggested that previous losses were due, in part, to the cost of building a cloud, and once the expenses drop, better results will follow.

The announcement of the new French cloud does not specify whether Google or Thales will bear the cost of the construction, but it would be a strangely imbalanced partnership if Google piled up all the money.

The register imagine that the news will not go well with the French cloud operator OVH. Nor at a Google Cloud partner, VMware, which overnight announced support for partners wishing to create sovereign clouds on its stack.

These partners may now wonder if Google is talking to companies with pedigrees like Thales. ®


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