The battle between Apple and Amazon to establish itself as the biggest consumer of dollars and gaining pedestal attention is well known around the world. However, there seems to be another connection between the two giant companies. Apple is one of the biggest Amazon Web Services customers as it spends close to $30mn every month on cloud computing, according to people who are familiar with the above-said arrangement.
The fact that Apple is spending so much on AWS is reflective of the intent by the company to establish itself in the cloud sector and it is even ready to take the help of its major competitor to achieve that. As the sale of iPhones reached saturation in recent times with the numbers dwindling rapidly, Apple has figured out that online services are the next big thing.
They even stopped giving out information about the sale of their hardware products and started focusing on disclosing the margin of profit made through other services like the App Store, AppleCare, Apple Pay and iCloud. The introduction of subscription to magazines and video services further strengthened their newfound approach.
It is true that more than a billion Apple units are used each month and this requires exceptionally high storage spaces. Apple revealed that it is has set aside a budget of around $10 billion for new data centers in the US. It mainly depends on AWS for its cloud services although third-party involvement is also seen sporadically.
However, in one of the job posting published in February, Apple said that it is still searching for someone who could handle their cloud footprint efficiently. As of March, they have been spending $30mn a month on AWS which is going to take the total to $360mn for the year 2019 which is more than the $350mn that was spent in 2018. The expenditure is likely to continue further as Apple contributes towards a major revenue generation source for Amazon.