Google Cloud chief details how search giants is making billions monetizing its AI products

Google's unreality main Thomas Kurian connected Tuesday explained however the tech elephantine is already monetizing its assorted artificial quality services to make revenue.

"We've made billions utilizing AI already," said Kurian, speaking astatine the Goldman Sachs Communacopia and Technology Conference successful San Francisco.

Kurian said that Google Cloud's backlog of lawsuit request is increasing faster than its revenue.

"Our backlog is present astatine $106 cardinal — it is increasing faster than our revenue," helium said. "More than 50% of it volition person to gross implicit the adjacent 2 years."

During its astir caller 2nd quarter, Google genitor Alphabet successful July reported gross of $13.62 cardinal for its unreality computing business, which was a 32% summation from the twelvemonth prior. Alphabet's nett income accrued to $28.20 billion, up astir 20% from the erstwhile year. While Google's unreality portion lags Microsoft and Amazon's unreality units, it's increasing faster than them.

Here's what Kurian said astir however Google Cloud is monetizing AI:

Kurian said immoderate radical wage Google by consumption, giving the illustration of AI infrastructure purchased by endeavor customers.

"Whether it's a GPU, TPU oregon a model, you wage by token — meaning you wage by what you use," helium said. Tokens represent chunks of substance that a AI models process erstwhile they make oregon construe language.

Some radical usage lawsuit work systems, paying for it by what Kurian called "deflection rates." Such rates are priced based connected the business value customers get — things similar uptime, scalability, AI features and security.

Google Cloud besides provides tools similar a "deflection dashboard," that customers tin usage to way and negociate cause interactions.

Last month, Google won a $10 cardinal cloud contract from Meta spanning six years. Meta had mostly been reliant connected Amazon Web Services for unreality infrastructure, though it besides uses Microsoft Azure.

Some customers wage for unreality services by mode of subscriptions.

"You wage per idiosyncratic per monthly interest — for example, agents oregon Workspace," said Kurian, referring to the company's Gemini products, which has its ain subscription tiers with assorted retention options, and the Google Workspace productivity suite, which besides has respective subscription tiers,.

Google One, a fashionable idiosyncratic unreality retention subscription, offers a basal monthly work to users for $1.99 a month. Earlier this year, the institution offered a new subscription tier called "Google AI Ultra," which offers exclusive entree to the company's astir "cutting edge" AI products with 30 terabytes of retention for $249.99 per month.

Kurian gave an illustration of Google Cloud's cybersecurity subscription tiers, saying "we've seen immense maturation successful that."

Kurian said that upselling is different cardinal facet of Google Cloud's strategy.

"We besides upsell radical arsenic they usage much of it from 1 mentation to different due to the fact that we person higher prime models and higher-priced tiers," Kurian said.

He said that erstwhile customers usage Google's AI services, they upwind up utilizing much of the company's products.

"That leads customers who motion a committedness oregon declaration to walk much than they contacted for, which drives much gross growth," helium added.

Kurian says it is capturing caller customers much rapidly too.

"We've seen 28% sequential quarter-over-quarter maturation successful caller lawsuit wins successful the archetypal fractional of the year," said Kurian, adding that astir two-thirds of customers already usage Google Cloud's AI tools successful a meaningful way.

"Selling to existing customers is ever easier than selling to caller customers, truthful it helps america amended the outgo of sales," Kurian said.

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