Cloud Wars Live with Bob Evans

In today's Cloud Wars Minute, I look at Microsoft's strategy for balancing AI innovation with local governance, culture, and national control.

Highlights

00:04 — I want to start today with a quote from Natasha Crampton, Microsoft's Chief Responsible AI Officer. "AI sovereignty doesn't mean doing it alone." This quote stands out from an interview she recently gave on the sidelines of the UN AI for Good Summit in Geneva.

00:48 — Ultimately, Crampton, echoing Microsoft's stance, stated that nations should leverage the best global AI technologies while ensuring they're adapted to local laws, languages, cultures, and values. Crampton explains that AI sovereignty is about control, not isolation. It's about cross-border coordination whilst making sure that countries retain control over how AI is deployed, governed, and used.

01:18 — One of the main problems that Crampton highlights regarding AI sovereignty is how AI is widening the gap between developed and developing economies. She says we cannot let the digital divide become an even greater AI divide. She emphasized the importance of making these technologies more accessible to the Global South.

01:43 — She says that AI sovereignty is about making sure that local impact, local cultures, values, and norms are prioritized within AI systems while taking advantage of global technology. AI becomes far more valuable when it understands local languages and cultures rather than simply translating from English.

02:15 — Overall, Crampton laid out a clear and, I'd say, pretty unique vision for what AI sovereignty can be. It's also a clever position for Microsoft to take, saying to governments that choosing Microsoft doesn't mean giving up sovereignty because they can control the data, the governance, and the policies on Microsoft's global platforms.

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In today's Cloud Wars Minute, I examine why Google Cloud's explosive growth is redefining the competitive landscape ahead of Microsoft and AWS earnings.

Highlights

00:03 —We have earnings results coming up later this week from both Microsoft and AWS. Microsoft on July 29, and AWS on July 30. So, that'll give us some nice comparisons to the stunning Q2 that Google Cloud reported last week. Google Cloud will be outgrowing AWS by somewhere between two and a half times at the high end, and at least two times on the low end.

01:02 — Over the last several quarters, Jassy has alluded to Google Cloud, not by name on earnings calls, but he said, "We've got some companies throwing up these fancy high growth rates." What we see with these growth rates is the customers expressing their vote. They are the ultimate arbiters in this decision about who's the hottest company. That's expressed in growth rates.

02:23 — I'm comparing Q2 here for Google Cloud versus Q1 for AWS because, right now, the Q2 numbers aren't out yet. AWS grew at 28%. Google Cloud grew 82%. Say AWS reports this massive acceleration to 40%. They would still be outgrown by Google Cloud by 2X. My guess is AWS's growth rate will come in somewhere around 30% or 31%.

03:22 — It is becoming a little tiresome for these bigger companies to say, "We're bigger than them. Of course, they have a higher growth rate." The customers are voting here. These growth rate disparities are so important because they tell us how the different vendors are doing in the marketplace through the eyes and wallets of customers.

04:01 — In the Cloud Wars, the customers are always, always the big winners. Microsoft and AWS are growing their cloud businesses in the range of 30%, which is astonishing. But Google Cloud posted 82% revenue growth and backlog growth of almost 400% to over $500 billion. By the numbers, Google Cloud is the king of the hill right now.

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In today's Cloud Wars Minute, I look at why playing to win — not playing it safe — is becoming the defining strategy for AI and cloud leaders.

Highlights

00:01 — Last week, we talked about Google Cloud's extraordinary Q2, with revenue up 82% to almost $25 billion, backlog up almost 400% to $514 billion. I wanted to talk today a little bit about a challenge that Google Cloud and the other hyperscalers are facing, because this extraordinary growth requires very aggressive investments in CapEx to build out data center capacity.

00:58 — Will these companies continue to have the courage to play to win, as opposed to trying to appease rattled investors? Right after Alphabet reported these numbers, Alphabet also had to say that its CapEx budget for 2026 is going to go up slightly to about $200 billion, while Q2 cash flow was negative $5.9 billion.

01:49 — But it's not a long-term trend here. The market reaction was they hammered Alphabet stock, and its market cap went down $250 billion after Google Cloud reported this. My point is, you've got to keep a clear head in these crazy sorts of times, and I think Alphabet is doing exactly that. Sundar Pichai cited immense opportunities during the Q2 earnings call and talked about the complete AI stack.

02:56 — They believe these investments they're making now are going to pay off with significantly more data center capacity next year. In the short term, Google Cloud is going to tap into some third-party data center capacity, Pichai said, as one of the ways to take care of customers. They're willing to trade that very short-term pain for enormous contracts down the line.

04:09 — It's a wild time here, but definitely, as I've said many times, this is the greatest growth market the world has ever known. These big hyperscaler companies are now faced with challenges that no company has ever had to face before. I applaud the Alphabet leadership for playing to win rather than playing not to lose. That's just not going to cut it in the Cloud Wars.

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In today's Cloud Wars Minute, I explain how Salesforce's latest MCP announcement advances Marc Benioff's vision for AI-first enterprise collaboration.

Highlights

00:03 — Salesforce has announced the introduction of new MCP servers that connect Slack to Salesforce CRM, Tableau, Data 360, and third-party AI tools. Now, these new servers have enhanced Slackbot, which is Slack's personal AI agent, enabling it to serve as a conversational interface for tasks across the Salesforce ecosystem.

00:29 — The headline for the press release about this announcement really summarizes it very well: "Slackbot can now do anything Salesforce can — just ask." Salesforce users can now view and update Salesforce records, run automations, access custom data without leaving Slack, and just using natural language. Users can query Tableau dashboards and analytics.

00:55 — Data 360 integration now enables Slackbot to access customer data for better responses and context-aware responses. Slackbot can now orchestrate work across multiple AI agents and enterprise apps, including partners like Anthropic, Atlassian, DocuSign, and Zapier. And the whole thing can be centrally managed by admins with built-in authentication and security.

01:22 — These Salesforce-hosted MCP servers are now generally available for all Enterprise Edition organizations and above. So what's the vision here? Well, Kris Billmaier, EVP and GM of Sales Cloud, explained, "Salesforce Sales Cloud in Slack is the future of how revenue teams work," he said.

01:55 — "AI is changing what it means to sell, and putting Salesforce intelligence and data inside Slack, where sellers already live, means teams stop chasing context and start driving growth. That shift is happening now, and we're right at the center of it." Ultimately, Salesforce is now positioning Slack as the primary workspace for AI-powered collaboration.

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In today's Cloud Wars Minute, I show why Google Cloud is setting the pace in the AI economy despite Microsoft's and AWS's larger scale.

Highlights

00:03 — Well, we thought we had seen some big numbers in the Cloud Wars over the last few quarters, but Google Cloud for Q2 absolutely blew the numbers away. Astonishing: revenue up 82% to almost $25 billion, and its backlog up 390% to $514 billion.

01:39 — From Q1 to Q2, Google Cloud's revenue jumped $4.8 billion. That's far larger, not only than what Google Cloud has done quarter to quarter, but Microsoft and AWS. I believe, looking pretty closely over a long period of time, for any of those companies to have a $3 billion increase quarter to quarter has been remarkable.

02:16 — I've got an article offering some highlights from this, and also side-by-side-by-side comparisons of the growth that Google Cloud, Microsoft Cloud, and AWS have each posted over the past five quarters. What makes Google Cloud stand out is the arc of its acceleration. It is much, much steeper, much higher.

03:18 — Q4, Google Cloud really broke away from the pack: 48% growth in Q4, 63% growth in Q1, and here now for Q2, 82%. Just absolutely remarkable, and I think we see that among the hyperscalers, and perhaps others as well, Google Cloud is clearly the AI leader.

04:32 — While Microsoft Cloud and AWS have bigger revenue numbers, Google Cloud is the one setting the pace, winning more customers, winning new business, and setting the pace with technology, go-to-market innovation, and the confidence, in large part delivered by the remarkable security business it's built, that it can handle everything that customers need as they move into the AI economy.

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