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Google spends in three months on data centers what used to take a year

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Google spent a whopping $US2.35bn on its data centers in the first quarter of 2014.

The expenditure was revealed by Google on Wednesday deep within its financial results and demonstrates how much the company has grown in the past decade, considering that it spent the same amount during the entirety of 2008.

In other words, what Google now spends on purchases of property and equipment (most of which goes on data centers and associated IT gear) in 90 days, it used to spend in a year.

This level of expenditure dwarfs Google's data-intensive rivals as well. Amazon, for instance, spent $880m in its most recent quarter and Microsoft spent $1.7bn.

The significant gap in capital expenditures between Google and its rivals illustrates both the world-spanning scale at which the company operates and also its wider strategy of designing systems to not only organize but store and analyze the world's information.

Google Street View, for instance, was launched in the summer of 2007 and since then has been ingesting petabytes upon petabytes of visual data captured on land and at sea. All of the data has to go somewhere and even with Google's in-house technical resources this carries a cost.

Meanwhile, the company has been buying more and more computer chips as it tries to run sophisticated analysis tasks over this voluminous information, such as the "cat face" recognizing layered neural network it trained using 15,000 processors.

Now, we're reaching a point where Google's many "Deep Learning" endeavors have grown good enough to be put into wide production use for tasks such as image recognition, natural language processing and search. This means the company is also going to be buying more computer chips than before to let it analyze this stuff.

Again, all of that comes at a cost.

Google's spending on property and equipment for the entirety of 2013 was $7.35bn including operating lease agreements. Given this quarter's significant investment, Google's massive (and secretive) artificial intelligence push, and the fact it has just begun a serious price war for cloud services with Amazon and Microsoft El Reg is betting the company could spend $10bn this year without blinking. ®

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