Nonstop cloud computing price war: Amazon, Google both drop rates again

Just as
industry watchers have
predicted, the race to the
bottom for cloud computing
prices continues.
On Thursday, while
announcing that the beta tag
has been removed from the
Google Compute Engine
(GCE) cloud service, Google
also reduced prices for the
on-demand virtual machines
by 4% across the board.
Not to be outdone, about 12
hours later -- almost as if it
was waiting for a competitor
to make such a move --
Amazon Web Services (AWS)
announced a 26% drop in
prices for its Windows virtual
machines (VMs) on demand.
Take that Google, AWS
seemingly said.
[ MORE CLOUD: Amazon's
biggest competitor in the
cloud: Salesforce.com? ]
Like most of the price
reduction announcements
from AWS, the market-leading
cloud computing
infrastructure as a service
(IaaS) provider, this week's
announcement of a price drop
on AWS virtual machines
(VMs) applies to only a
subset of its services, this
time focusing on its Microsoft
Windows products.
Pricing for the default small
VM running Windows OS
dropped from $0.115 per
hour to $0.091 per hour, a
21% drop. Other Windows VM
types also fell in price, in
some cases by an even higher
percentage, including high-
memory (now $0.51 per
hour) and high-CPU (now $
0.225 per hour).
The news of AWS's price
reduction was seemingly in
response to the
announcement by Google that
same day of its Amazon-
competitor cloud. In a blog
post earlier in the day on
Thursday, Google engineers
said the beta tag has been
taken off the company's GCE.
The IaaS on-demand VM
service complements its
Google App Engine (GAE)
platform as a service (PaaS)
already available on the
market. Customers can now
use GCE without being invited
to do so by Google and
without special arrangements
from a salesperson, it said.
There is a catch though: It
requires a Gold support
package, which costs $400 a
month and includes 24/7
phone support and
consultation on architecting
the service.
As part of announcing the
semi-general availability of
its GCE, Google also
announced a 4% price
reduction of GCE prices. A
standard GCE VM now costs
$0.132 per hour, compared to
$0.138 previously -- a 4.3%
reduction in price. Though
slightly more expensive than
AWS's default VM, GCE's
standard single-core VM
packs more compute power
than AWS's standard VM
offering. GCE's base-level VM
comes with 3.75GB of
memory and 420GB of local
disk, while AWS's standard
offering comes with 160GB of
local storage and 1.7GB of
memory. Both AWS and GCE
offer high-capacity VM sizes
as well.
[ MORE: 100GB of free cloud
storage ... with a catch ]
In a blog post announcing its
price reduction on Windows
VMs, Amazon said the move
represents a focus the
company has on offering
Microsoft products and
services from its cloud. In
recent weeks the company
has also advanced support
for SQL Servers that run in its
cloud by adding new drivers
that increase performance
and the number of supported
volumes instances can
handle, for example.
The effort to focus on
Microsoft has been seen by
some as one piece of
Amazon's strategy to butter
up its cloud services to entice
enterprise buyers. Business
Insider recently reported that
Amazon is hiring sales reps
pushing into the enterprise
market faster than any other
company selling to the
enterprise, for example.
Network World senior writer
Brandon Butler covers cloud
computing and social
collaboration. He can be
reached at BButler@nww.com
and found on Twitter at @
BButlerNWW.
Originally published on
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