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Is Google’s Bet On Blockchain Technology A Natural Step After Cloud?

Is Google’s Bet On Blockchain Technology A Natural Step After Cloud?

Smita Sinha

Far be it for Google to lag behind in an area like blockchain which is already surging rapidly ahead in sectors such as banking, finance and governance. While only a handful of big players have been leading the industry by offering blockchain-related tools, the search engine giant now seems all set to take a plunge in this space.

According to reports, the California-based tech company is working on its own blockchain technology to support and further secure its cloud business and head off competition from tech companies such as Microsoft, IBM and Amazon, among others.

As blockchain is a digital, decentralised ledger that keeps a record of all transactions that take place across a peer-to-peer network, the potential applications for Google are enormous. For example, after the Cambridge Analytica and Facebook scandal, users across the globe worrying about the safety of their data. Blockchain could be one of the ways the search engine giant who has a considerable stake in cloud business as well, could use the new technology to allay their fears.

Why Is Google Getting Into The Blockchain Game?

The search-engine giant is reportedly considering taking blockchain-related technology and develop its own distributed digital ledger. It could use this technology to reassure customers on its cloud platform that their data is protected when stored on Google network of computer servers. Google is known for developing cutting-edge technologies.


“Like many new technologies, we have individuals in various teams exploring potential uses of blockchain but it’s way too early for us to speculate about any possible uses or plans,” a Google spokesman said in a report.

In 2017 earnings conference call, Google CEO Sundar Pichai announced that Google Cloud, which includes Google Cloud platform and G Suite has reached a meaningful scale. It is already a $1 billion per quarter business and is one of the fastest growing, major, public cloud provider in the world. To catch up and strengthen this rapid growth, Google might have been prompted to climb aboard the blockchain train.

Now as the tech industry is changing, the blockchain-like technology will allow the company to upgrade its assets and make its security stronger. And to build its own digital ledger, Google has looked at technology from the Hyperledger consortium but they may explore alternative options that are easier to scale to run millions of transactions.

White-Label Blockchain Versions

Beyond using the technology internally, Google is also planning to distribute its digital ledger to third parties so that they can use them to post and verify transactions. Additionally, they are also planning to create a white-label version of its distributed ledger that other companies can use on their own servers. With this offering, the tech giant may also be open to offering private blockchains. Its clients can own, control and operate these private blockchains, either over various servers or host them securely on a private network.

“The Alphabet Inc. unit is developing its own distributed digital ledger that third parties can use to post and verify transactions,” a person familiar with the matter said in a report.

Google’s Competitors

Many tech companies and startups have seen the potential of blockchain technology and are creating new online services. Until now, IBM and Microsoft have been the most active in rolling out special developers tools and inviting banks and startups to test the new database technology in their data centers. Even Amazon Web Services, who is giving a stiff competition to Google in cloud service business, is reported to be working with blockchain technology.

Last year, IBM announced IBM Blockchain, its first enterprise-ready blockchain service based on the Linux Foundation’s Hyperledger Fabric version 1.0, which enables developers to quickly build and host security-rich production blockchain networks on the IBM cloud. Given its great computing power across private clouds, it already has 400 clients on its blockchain platform.

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On the other hand, Microsoft is using blockchain to tackle cybersecurity issues. With its new Coco Framework, Microsoft wants to make blockchain networks enterprise ready. “The company is seeing a lot of interest in blockchain technology among its users and want a technology that can handle a thousand or more transactions per second,”  Microsoft’s CTO for Azure Mark Russinovich said in a report.

There are a slew of startups which are giving Google a run for their money by using digital ledger. For example, a startup called Brave Browser is competing with Google Chrome by using blockchain technology. Instead of running targeted ads, Brave uses blockchain to pay websites when people spend time on their web browser. Another browser, BitClave, allows people to perform searches online and get rewards for viewing ads.

Google Has Done Its Homework

Google has been doing its research and funding in the blockchain field way before most companies did, as it came as an extension to its cloud service. Between 2012 to 2017, Google was acquiring blockchain startups and pumping millions of dollars into the industry. The company began its trial in 2016 which let developers test blockchain services on its cloud. However, it is now extensively exploring ways to deploy its blockchain-like technology.  

According to a research report by CB Insights, Google Venture, Alphabet Inc’s venture capital arm became a leading investor in 2017. Google Venture has invested in wallet service Blockchain Luxembourg, financial network Ripple, cryptocurrency asset management platform LedgerX, international payments provider Veem and the now-defunct Buttercoin.

At a recent conference, Google’s advertising chief Sridhar Ramaswamy noted that the existing core technology can’t handle a lot of transactions quickly. So a ‘small team’ in his division is looking at blockchain.

According to reports, many employees in the Google’s infrastructure group have been tinkering with the blockchain protocols in recent months. Even Google insiders said that the company’s line of cloud services are a natural fit for the blockchain technology. However, it is unclear when the company plans to release this product and it’s not ready to make any official announcement yet. As it has already done its blockchain homework, it is hard to imagine once it releases its product in the market it won’t dominate in the blockchain field and be able to give tough competition to other players who are currently ruling the roost.

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