Google spent $ 1 bn on infrastructure last quarter

by CXOtoday News Desk    Jan 23, 2013

Google
Google spent more than a billion dollars on infrastructure in the fourth quarter, representing the company’s second-biggest quarterly expenditure ever. As it competes against Facebook, Apple, Yelp and Amazon, the company can’t afford to stop building datacenters now, reported Derrick Harris for Gigaom.com

According to the website, Google’s infrastructure spending continued its upward trend during the fourth quarter, hitting a two-year high of $1.02 billion. Excluding the fourth quarter of 2010— in which Google spent $2 billion for a massive datacenter/office location at 111 8th Avenue in New York — the company’s last quarter represents the biggest infrastructure investment in its history.

The website reported that it is unsure where all that investment went, but the record spending probably shouldn’t come as a surprise given the current state of the web economy. “Google now finds itself competing against (or has put itself in a position to compete against) formidable foes in a variety of different areas, going into battle against companies such as Apple, Facebook, Yelp, Amazon Web Services and (with the advent of Google Fiber) internet service providers — and doing it well — costs a lot,” wrote Harris.

It requires a lot of investment in servers, datacenters and other gear in order to deliver quality web and mobile services. For a company like Google, that means having datacenters spread throughout the world to meet demand in different geographies, as well as building special servers and facilities designed specifically to meet the company’s unique workloads. Products matter, but so does the user experience and every second users spend waiting for a page to load or a spreadsheet to update means a greater chance they’ll just go elsewhere, said the website.

Especially in its battle against Facebook, Google can’t afford to get caught slipping. The social network leader is regularly rolling out new services and storing many petabytes of user data. It’s also spending like a drunken sailor on infrastructure, investing more than a billion in infrastructure itself through the third quarter of 2012. That’s a lot less than Google, granted, but it’s nearly a third of Facebook’s total revenue during the same period, wrote the website.