Google Cloud Platform Price Cuts May Fuel Global Price War

Google Cloud Platform

Google’s announcement yesterday that it would cut its Google cloud platform costs by as much as 30 percent, will encourage consumers to continue shifting focus from straightforward price to a more valuable price/performance option and may start a price war.

On the other hand, according to Andreas Gauger, CMO and co-founder of the award-winning cloud IaaS provider, ProfitBricks, it could even result in price no longer playing a pivotal role in cloud buying choice.

Late last year ProfitBricks became the first IaaS provider to offer a guarantee based on price and performance, stating it was continuing its campaign to “make it painless to move to the cloud.” Late March, the company boldly announced it would guarantee that any workload that was deployed on its IaaS cloud would cost less than the same workload running at the same performance level on the IaaS platforms of Amazon, Microsoft or Google.

When Google announced its decision to further reduce its prices, ProfitBricks was quick to say it would continue to honor its guarantee, in spite of the fact that Google stated categorically that it was now 40 percent less expensive for a large number of workloads.

andreas_gaugerGoogle certainly offers the first challenge to the price/performance guarantee that ProfitBricks rolled out in November,” Gauger told CloudTweaks this morning. “We applaud any attempt by the major players to move IaaS pricing to the commodity level as we believe that cloud buyers have already shifted their focus from price to price/performance. The rapidly growing interest in performance is a normal indicator that the technology has matured and cloud buyers now understand the value that the technology has matured and cloud buyers now understand the value that cloud computing brings to their organization.”

Yesterday Google stated it was “raising the bar” with its pricing options, not only lowering prices, but also adding flexibility so that customers are not forced to sign up for fixed-price commitments long term, claiming it was easy to see “why we’re leading the industry in price/performance.” The company’s “new class of preemptible virtual machines” now deliver a remarkably short-term capacity for an equally remarkable low cost that is fixed. They offer automatic discounts, per-minute billing, and don’t charge penalties for customers wanting to change machine types.

Latest Price Reductions

The latest price reductions that apply specifically to the US, range from 5 percent for high CPU to 30 percent for micro. High memory and small configurations see a 15 percent price reduction, while a standard configuration has a 20 percent price reduction. According to Google, the price reductions in Asia and Europe are similar to these.

The open question,” says Gauger, “is whether this latest pricing announcement will spark a price war among the major providers or take price off the table altogether. The hope is that at the end, the cloud users are the big winners.”

ProfitBricks has maintained for a while that cloud pricing has been far too confusing for much too long. For this reason they positioned themselves to offer minute-based billing in what was designed to be one of the simplest pricing models in the cloud industry. There are four items involved – CPU cores, RAM, storage, and traffic – and an online calculator lets customers both configure the cloud as they wish, and then predict their costs hourly or monthly.

ProfitBricks was named one of the Coolest Cloud Infrastructure Vendors of 2015 by CRN and was the recipient of two CODiE awards and a Frost & Sullivan cloud innovation award for 2014. The company has offices in Berlin, Germany, San Antonio, Texas and Boston, Massachusetts.

By Penny Swift

Using Data Scraping to Learn What You Need to Know
Data Scraping Opportunities How can you know what you don’t know? It sounds like a rhetorical question, but it is in fact a vital component of business strategy. As much as any company or organization ...
Louis
Why cybersecurity spending Is resilient Cybersecurity tech stacks must close the gaps that leave human and machine endpoints, cloud infrastructure, hybrid cloud and software supply chains vulnerable to breaches. The projected fastest-growing areas of cybersecurity ...
Cloudtweaks Comic Ai
How AI Is Important for Businesses Shifting to Remote Work The Coronavirus Pandemic has taught us that organizations must have remote work choices. It is no longer possible to work in a digital environment. The ...
Shireesh Thota
Here’s How to Position Your Organization for the Era of Data Intensity We live in a data-intensive era. Data is booming. Companies are realizing that data is one of the most important assets and they ...
James Corbishly
Teams Sprawl in the Remote Workspace As working from home has become the new everyday norm, with more employers embracing the remote-work model as a new and likely permanent fixture of the employment world, there ...
  • Plural Site

    Pluralsite

    Pluralsight provides online courses on popular programming languages and developer tools. Other courses cover fields such as IT security best practices, server infrastructure, and virtualization.

  • Isc2

    ISC2

    (ISC)² provides IT training, certifications, and exams that run online, on your premises, or in classrooms. Self-study resources are available. You can also train groups of 10 or more of your employees. If you want a job in cybersecurity, this is the route to take.

  • App Academy

    App Academy

    Immersive software engineering programs. No experience required. Pay $0 until you're hired. Join an online info session to learn more

  • Cybrary

    Cybrary

    CYBRARY Open source Cyber Security learning. Free for everyone, forever. The world's largest cyber security community. Cybrary provides free IT training and paid IT certificates. Courses for beginners, intermediates, and advanced users are available.