Google slashes cloud computing prices in rivalry with Amazon

April 8, 2014 Leave a comment

Google slashes cloud computing prices in rivalry with Amazon

3:49pm EDT

By Alexei Oreskovic

SAN FRANCISCO (Reuters) – Google Inc slashed its cloud computing service prices on Tuesday, seeking to wrest customers from Amazon.com Inc and Microsoft Corp in the fast-growing market of renting computers and data storage to companies.

Price cuts range from 30 to 85 percent. Google’s Cloud Storage will cost 2.6 cents per gigabyte, about 68 percent lower for most customers. Google’s Compute Engine services will cost 32 percent less across all sizes, regions and classes.

“The cost of virtualized hardware should fall in line with the cost of the underlying real hardware,” Google Senior Vice President Urs Holzle said in a post on Google’s official developers blog on Tuesday in conjunction with a cloud event that the company hosted in San Francisco.

Holzle noted that hardware costs have improved by 20 to 30 percent during the past five years but that “public cloud prices fell at just 8 percent per year.”

Cloud services are increasingly popular among tech startups and larger companies, which rely on computers owned and operated by the likes of Amazon and Google, the world’s No. 1 Internet search engine, instead of buying the equipment themselves.

Amazon, one of the largest online retailers, was among the first companies to recognize the opportunity. Amazon Web Services provide the underlying infrastructure for key aspects of popular Web companies such as online movie streaming service Netflix Inc and social network Pinterest.

Amazon’s Web Services will hold an event in San Francisco to discuss its business on Wednesday. Amazon did not immediately respond to a request for comment on whether it would respond to Google’s price cuts.

Earlier this week Cisco Systems Inc announced plans to spend $1 billion over the next two years to build a new cloud services business.

 

Filed under TMT Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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