Is Satellite Cloud Computing the Next Frontier? | ETF Trends

Amid Covid-19 and a heavier reliance on technology, cloud computing has proven its mettle. Now, the world could be witnessing the next frontier in the cloud computing space via satellite usage, which could pit two tech giants head to head.

According to a CNBC report, “Microsoft is looking to challenge Amazon in offering a service that connects satellites directly to the company’s cloud computing network, according to documents the company filed with the Federal Communications Commission last month.”

“The effort shows how the two largest providers of cloud infrastructure — data centers in far-flung places that can host websites and run applications with a smorgasbord of computing and storage services — regularly seek to one-up each other,” the report added. “That way, the companies can appear ready and willing to meet many of the needs of prospective customers.”

The report also noted that Microsoft looks to run satellite cloud computing demonstrations “before, during, and after its Ignite conference for IT professionals, which starts on Sept. 22, the company said in a different FCC filing.” These demonstrations will be crucial for Microsoft’s next steps in moving the satellite cloud project forward.

“If the demonstrations result in significant market interest, Microsoft will file an application for regular earth station authority with the International Bureau (IB) to support future commercial operations, and that application will include a request for U.S. market access for DEIMOS-2,” the company wrote.

Getting Cloud Exposure via ETFs

One exchange-traded fund to look at is the Global X Cloud Computing ETF (Nasdaq: CLOU). Seeking to track the Indxx Global Cloud Computing Index, the fund holds a basket of companies that potentially stand to benefit from the continuing proliferation of cloud computing technology and services.

The cloud computing industry refers to companies that (i) license and deliver software over the internet on a subscription basis (SaaS), (ii) provide a platform for creating software applications which are delivered over the internet (PaaS), (iii) provide virtualized computing infrastructure over the internet (IaaS), (iv) own and manage facilities customers use to store data and servers, including data center Real Estate Investment Trusts (REITs), and/or (v) manufacture or distribute infrastructure and/or hardware components used in cloud and edge computing activities.

Another fund to consider is the WisdomTree Cloud Computing Fund (WCLD). The fund seeks to track the price and yield performance of the BVP Nasdaq Emerging Cloud Index, which is designed to track the performance of emerging public companies primarily involved in providing cloud computing software and services to their customers. It is non-diversified.

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