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Report: Apple building its own data centers and cloud

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Apple has been working on building its own cloud and the work has been dubbed "Project McQueen." A source familiar with the project spoke with VentureBeat on the motivation behind the project and what implications it could have for the company.

According to VentureBeat's source, Apple has been displeased with AWS's multimedia upload speeds (loading photos and videos) on iOS. In addition, iTunes is already outsourced to other infrastructure – mainly Azure. A report yesterday noted that Apple is also turning to Google's cloud for some iCloud services as well, another move that shows Cupertino's aversion to AWS.

According to the source, the idea sprung from a conversation between an Apple employee and a Microsoft employee. Apparently, the Microsoft employee explained, "Azure won't be able to handle the growth of Apple's workloads in the future, meaning Apple would have to pay much more in order to help Microsoft cover the cost of expanding Azure's data center infrastructure," VentureBeat noted.

Apple saw the business value in having its own infrastructure, and has already purchased some land in China and Hong Kong for its data centers, according to the source. The source also noted that this new infrastructure, which would cover cloud computing and storage needs, would pay for itself within three years.

VentureBeat addressed how this move is in contrast to the public cloud trend many companies are going with these days. "While public cloud infrastructure has allowed many startups to get their applications up and running, and while larger corporations are increasingly adopting cloud infrastructure, it's not always sensible," VentureBeat explained. This is a fair analysis.

Smaller companies may not have – let alone want to invest – the capital in building their own cloud infrastructure when a public cloud satisfies needs. For startups or companies who just simply don't require a large amount of cloud storage, public cloud makes sense. It's affordable, easy and they don't have to keep up with rapidly changing technology.

Broadview CIO Ken Shulman spoke to FierceCIO earlier this month about this very issue. "Technology is changing so rapidly, individual companies just can't keep up," Shulman said. "So you get into this trade-off question. First of all technology is changing rapidly, the knowledge of that technology is changing rapidly. … So you move to this different model, and you think, 'well I don't want to buy them, I want to rent them. I want someone else to invest their money into them.' That's really what cloud is all about."

For larger companies, however, public cloud can start to get more pricy as their user base grows. Apple is no stranger to building their own data centers, VentureBeat noted, as they have built data centers in the past to support iCloud. The likes of Facebook, LinkedIn, Twitter and others have also built their own infrastructure to keep up speed of service for their growing users, VentureBeat noted. Apple, now with its own hundreds of millions of users, will be able to deliver content much faster with its own set of data centers.

"Apple would be able to run its software on the best possible infrastructure for its needs, at the lowest possible cost," VentureBeat said. "Perhaps most importantly, this would improve the user experience."

VentureBeat also made mention of the potential this infrastructure could have for folks like app developers. Project McQueen could offer a suite of cloud infrastructure and services to app developers, which they could use to power applications. This would also help Apple avoid generating revenue for its competitors, VentureBeat noted.

Both Apple and Amazon declined to comment directly to VentureBeat, but the publication did note that, "Project McQueen is a plan, nothing more. Apple could end up setting it aside and keeping its applications running in their current configuration. Or Apple could take a different route, and acquire a cloud infrastructure provider."

Apple did not immediately respond to a request for comment on these claims.

For more: 
- read the full report on VentureBeat

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