Apple's future beyond the iPhone increasingly involves software services, from Apple Music and iCloud to its new TV Plus video offer and subscription to News Plus magazine. However, an important factor in helping these cloud-based services operate on its nearly 1.5 billion active devices simultaneously is the company's ongoing contract with Amazon, specifically the cloud computing division. from Amazon. According to CNBC, Apple is one of the main customers of Amazon Web Services, with monthly payments to the cloud division totaling more than $ 30 million and increasing.
Now, CNBC reports that Apple has not publicly said that it trusts AWS for more than iCloud. But still, an expense of more than $ 360 million a year means that Apple relies heavily on AWS to operate core parts of its business, although doing so means working with a rival in the future in online video and a current competitor in areas such as artificial intelligence, streaming music and smart home products.
Apple is far from being the only company that runs parts of its cloud on Amazon servers. A series of large technology companies that have come forward to make public this year have revealed in financial documents that they pay Amazon hundreds of millions per year. That includes both Lyft and Pinterest.
Lyft said it promised to pay Amazon 300 million dollars through 2021 due to an ongoing contract, while Pinterest says it will pay Amazon about 750 million dollars at the end of a six-year contract that will expire in 2023. Some other companies are not large enough to operate their own data centers or their own cloud services, such as Google, Facebook and Microsoft, have also publicly disclosed important AWS contracts, including a commitment of more than 1,000 million dollars of Snap Inc. until 2021. Other large technology companies such as Netflix and Spotify have been using AWS for years, making their broadcasting empires dependent on the Amazon cloud.
It is not clear in this case that Apple will require much more AWS computing and, therefore, a larger and more expensive contract. Apple manages a series of proprietary data centers throughout the US UU And it is likely that part, or even most, of your online services will run in those data centers, although the company has never explicitly disclosed this information. Neither Amazon nor Apple were immediately available for comment.
In any case, the size of Apple's commitment to AWS is remarkable, if only to shed light on how much money it costs, at a minimum, to run a service like iCloud that operates on almost 1,500 million devices. For Apple, which is trying to transform itself into a service provider and an entertainment giant that does not have to rely so much on the sale of expensive phones every year, it's an expense that will probably only continue to rise.