MAY 17, 2011 10:07am ET

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Google Now Third Largest Maker of Servers

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May 17, 2011 – Google has become the third-largest maker of computing servers, according to Ben Fried, its chief information officer.

And all the servers it makes are for its own use, Fried said at the first Bloomberg Enterprise Technology Summit Tuesday in New York.

That's because of Google's insatiable demand for compute power – and the fact that it designs and builds all its servers to its own specifications, he said.

The choice of chips and the design of servers "dramatically lower" server costs for Google, he said, instead of buying off-the-shelf servers from the likes of Hewlett-Packard, Dell or IBM.

That means that Google now ranks just behind Hewlett-Packard and IBM in terms of servers manufactured. Last year, Hewlett-Packard overtook IBM as the top maker of servers, according to Gartner. Its next ranking is likely to be released next week, but won't include Google, which only "sells" to itself.

Google's demand for compute power is so great that Fried found a project under way to reclaim core processors within the servers it already had, when he came aboard three years ago this month from Morgan Stanley, the Wall Street investment house.

The project had been under way for nine months and when it was done, Google had reclaimed "more (cores) than the total number of cores on Wall Street," at the time, belonging to all market participants, he said.

He gave no numbers.

This story originally appeared in Securities Technology Monitor.

Tom Steinert-Threlkeld is the editor-in-chief of Securities Technology Monitor.

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