While Google is the front-runner, according to people familiar with the matter, PayPal is evaluating the other leading providers and hasn't made any final decisions. PayPal is unlikely to move its technology infrastructure in the fourth quarter, the peak period for online commerce, said the sources, who asked not to be named because the talks are confidential.
Under the leadership of VMware co-founder Diane Greene, Google is out to prove that it's a legitimate player in the rapidly expanding cloud infrastructure market.
It's a business that Amazon Web Services has come to dominate by opening up massive data centers across the globe and continuously adding new software tools that allow large corporations — and government entities — to securely offload their computing and storage needs.
Since taking the helm nine months ago, Greene has been in hot pursuit of Google's rivals, and her team is getting particularly aggressive on price as a way to potentially lure some of the biggest enterprises, sources said.
With close to $80 billion in cash and equivalents at the end of the second quarter and a $10 billion annual capital expenditure budget for parent Alphabet, Google has plenty of ammunition to engage in a pricing war.
Representatives from Google and PayPal declined to comment, as did spokespersons from Amazon and Microsoft.