Snap is paying Google $400M a year for cloud services

Over the next five years, the company behind Snapchat will pay Google at least US$ 2 billion in cloud bills.

On Thursday, Snap revealed in a filing with the US Securities and Exchange Commission that it signed a five-year contract to pay Google at least $ 400 million a year for cloud services. That’s a steep figure, considering that Snap made roughly $ 404 million last year. 

In return for the massive commitment, Snap will receive reduced pricing, though it’s not clear how deep the company’s discounts will be. Sinking a bunch of money into Google Cloud makes sense, because Snapchat began its life built on top of Google’s AppEngine platform-as-a-service offering.

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CIO Cloud Computing

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