Twitter has failed to pay its Google Cloud bills and with its contract up for renewal this month, placing the two companies in an intense dispute that might cripple Twitter’s trust and safety teams and risk the stability of the platform.
Twitter In Debt Again
Twitter has long had agreements with Google and Amazon to supplement its cloud infrastructure, even though the firm maintains some services on its own servers. As such, the business inked a multi-year $1 billion contract agreement with Google to host services connected to fighting spam, eliminating child sexual abuse material (CSAM), and protecting accounts, among other things, before Musk purchased Twitter last year.
However, the social media platform failed to honor its contract by not paying up its dues to keep the services running. The platform does not seem keen on paying its bills and is reportedly scrambling to remove as many services from Google’s infrastructure before the contract expires on June 30.
Twitter has stopped paying its Google Cloud bills, prompting concerns about what will happen to some of the services it hosts there, a report says https://t.co/eAM1NCoOBy
— Insider Tech (@TechInsider) June 12, 2023
Based on reports by The Platformer, the effort is running behind schedule placing key technologies in danger of being taken offline, including Smyte, a platform the business acquired in 2018 to improve its moderation capabilities.
Even before this infrastructure problem, Smyte has been experiencing issues as a result of Elon Musk’s significant staff reductions at Twitter. Musk allegedly questioned Twitter’s trust and safety team in December about why an automatic system hadn’t identified a Twitter Blue user who had been using his persona to promote a cryptocurrency hoax. The crew informed Musk that for a week, the system had been unreliable and crashed at least once a day.
The reign of Musk as Twitter CEO has been defined by the social media platform’s instability. For instance, in February, many of the platform’s essential components experienced multiple outages.
More recently, Florida Governor Ron DeSantis had issues as he tried to announce his candidacy for the Republican presidential nomination because Twitter Spaces could not handle the volume of individuals who wanted to listen to the broadcast.
Twitters Unpaid Bills and Lawsuits Mount
This scuffle with Google isn’t the first time the business has broken a contract. It allegedly didn’t pay the rent for its office building owned by California Property Trust. The trust eventually filed a lawsuit against the business at the end of the previous year for nonpayment of rent.
Additionally, Twitter received a warning from Amazon that it would stop paying for advertising in March because the social media platform also owed Amazon Web Services (AWS) money for cloud computing services.
Twitter reportedly decided not to pay Google Cloud because it was unhappy with the way its infrastructure was operating. Twitter has reportedly been experiencing several interruptions and inconsistencies and is refusing to pay Google in an effort to get it to correct the issues.
In a conversation with Silicon Angle, Holger Mueller, an analyst at Constellation Research said that if the rumors are accurate, Twitter runs the risk of possibly losing services that are important to its largest clients, particularly its advertisers.
Mueller explained that Musk is probably delaying payment so he may bargain with Google and is utilizing the deadline to mobilize his internal employees. “Musk knows how to manage things in a relentless way, but at the end of the day he knows there’s no getting out of the need to pay what’s owed to cloud providers,” he said.
“He also knows he can’t lose the goodwill of his advertisers, nor burn out his employees. So the pressure will likely dissipate at some point with payment and an extended deadline.”
While this might be true, Twitter is still not short of debts to pay and is more than $10 million late in payments to several companies that offer a variety of services to keep the company in operation. And unlike Google and Amazon who are using other means to push for payment, some of the vendors have taken the legal route.
In April four vendors filed a joint class action lawsuit against Twitter for breach of contract over the company’s allegedly unsettled bills. The platform has been sued by atleast 6 other vendors since December including Innisfree M&A over delay of payments, with some of the vendors relying on these payments to stay afloat.
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