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Cloud computing is expected to grow 17.5% this year to a global value of $214.3 billion, according to Gartner Inc.
It's no wonder that tech giants like Microsoft Corp. (NASDAQ: MSFT) and International Business Machines Corp. (NYSE: IBM), which just beat its earnings estimates on the back of its cloud businesses, are working so furiously to grab their share.
Right now, even the government is getting with the program, so to speak. Microsoft and Amazon.com Inc. (NASDAQ: AMZN), via its Amazon Web Services (AWS), are vying for a $10 billion cloud computing project for the Pentagon, dubbed the Joint Enterprise Defense Infrastructure (JEDI) project. As if a Star Wars--themed name were not good enough, some call the project the Department of Defense's "War Cloud."
While this underscores just how important the cloud will be, it also presents a great opportunity for a short-term play in anticipation of the contract award.
You see, one company is more likely to get the contract, and that could give a quick short-term boost to its stock as soon as next week.
Here's why could computing is such a game changer - and which company we think has the best shot of landing this $10 billion windfall next week...
Why Cloud Computing Is Fueling Tech Growth
The cloud is really just another term for the Internet - because a company, or an individual, can access their data and applications from anywhere, and theoretically on their handheld device.
As technology becomes less centralized, companies can store their data offsite in reliable, backed-up servers operated by others. And they can lease time on powerful computers that would be too expensive for them to own and maintain themselves. This collective off-site power is simply referred to as "the cloud," and companies that provide the hardware, software, and services are called cloud-computing companies.
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These companies run the gamut from providing the broadband speed to connect computers to cloud networks, servers to store the data, and software-as-a-service (SaaS) companies that offer remote access to powerful programs.
That's innovation! And it's the current trend in technology.
Right now, Amazon's Amazon Web Services and Microsoft's Azure cloud divisions are leading the cloud computing sector.
It's no wonder they're both finalists to win the Pentagon's coveted $10 billion contract.
But only one of them will get it...