Google Slashes Cloud Storage Costs

Google is cutting the price of its cloud services as it attempts to kick-start a price war in the online storage market.

At its Google Cloud Platform event in San Francisco yesterday, the company indicated it wants to challenge Amazon by slashing the costs of its storage service to a mere 2.6 cents per gigabyte. This undercuts Amazon’s Web Services offering, which currently costs a minimum of 37 cents per gigabyte.

Google’s price cuts equate to between a 30 and 85 percent reduction across its various on-demand and pay as you go services, with cloud storage in particular seeing a 68 percent cut.

Perfect curve

“Together we are resetting the price curve in the cloud to where it should be,” explained Google’s cloud senior vice president Urs Hölzle in a company blog. “This is a philosophy. The price curve of virtual hardware should follow the price curve of real hardware.”

Hölzle said that the price cuts were part of Google’s attempt to keep its cloud services linked to Moore’s Law, stating that, “The original promise of cloud computing was simple: virtualise hardware, pay only for what you use”. However over the last five years, the company saw public cloud prices falling at just 8 percent per year, compared to hardware costs, which decreased by 20-30 percent annually.

Google also announced several other changes to its cloud computing services, including a simplified pricing structure incorporating discounts for long-term users, cloud-based Devops tooling, Managed Virtual Machines for App Engine and real-time Big Data analytics with Google Bigquery, which sees its pricing reduced by 85 percent.

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.

“This is an exciting time to be a developer and build apps for a global audience,” he concluded. Recently, Google also cut prices for its consumer offering Google Drive.

Yesterday Microsoft said it will rename its Windows Azure brand to Microsoft Azure, as new CEO Satya Nadella, previously head of Azure tries to disassociate the service from the sometimes-problematic Windows PC branding.

“This change reflects Microsoft’s strategy and focus on Azure as the public cloud platform for customers as well as for our own services Office 365, Dynamics CRM, Bing, OneDrive, Skype, and Xbox Live,” stated Steven Martin, general manager for Windows Azure.

Another major player, Cisco, announced this week that it was looking to invest up to $1bn into enterprise cloud services, although its eponymous new service will not look to directly target the likes of Amazon or Google.  Amazon’s Web Services division is holding an event in San Francisco today to discuss its business, which should mean a reaction to Google’s news can’t be far away.

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