Amazon Cuts Cloud Platform Prices

Amazon has responded to Google cutting the price of its cloud services by reducing the costs of its own platform, Amazon Web Services (AWS).

At an AWS event in San Francisco, the company’s senior vice president Andy Jassy announced that prices for its S3 storage service will be reduced by about 51 percent, with users now being charged $0.03 per gigabyte on standard storage and $0.024 for reduced redundancy storage for the first terabyte of data. The prices of other services will be lowered on average by 28 percent to 61 percent, depending on the product.

“Lowering prices is not new to us,” said Jassy. “This is something we’ve done now 42 times. You can expect us to do this periodically.”

Price war

Overall, Amazon will be cutting prices on its Amazon EC2, Amazon S3, the Amazon Relational Database Service, and Elastic MapReduce services, with the new prices effective from 1 April.

Despite the cuts the services will still cost more than the new prices for  Google’s competing cloud services, which the search giant announced yesterday.

“We’ve often talked about the benefits that AWS’s scale and focus creates for our customer,” Amazon Web Services chief evangelist Jeff Barr wrote in a company blog. “Our ability to lower prices again now is an example of this principle at work.”

Amazon also announced a service which will give users a desktop-like computing experience through any Internet-connected computer or tablet, eliminating the need to use a particular machine for accessing specific applications like Microsoft Office.

Called Amazon WorkSpaces, the service has been in testing since November and will be available to all customers of Amazon Web Services starting today.

Google’s announcement yesterday was seen by many as a possible start to a cloud services price war, with Cisco and Microsoft also revealing new services recently. The company slashing the costs of its storage service to a mere 2.6 cents per gigabyte, a 68 percent cut, with other on-demand and pay as you go services seeing reductions of between 30 and 85 percent.

“Together we are resetting the price curve in the cloud to where it should be,” explained Google’s cloud senior vice president Urs Hölzle, stating that the price cuts were part of an attempt to link service costs to Moore’s Law.

Hölzle said that further developments were still in the works, with new features and functions set to be announced at Google I/O in June.

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