Amazon Responds in Cloud Price War
Amazon has come out just a day after Google's cloud price cuts with its own slate of price cuts. Both companies have the benefit of investors willing to look the other way as each strives for cloud supremacy. The head of AWS, Andy Jassy, leveled a subtle dig at Google talking up the fact that this is Amazon's 42nd price cut. 'Lowering prices is not new to us, this is something we've done 42 times,' he said. 'You can expect us to do this periodically.'
Jassy maintained the new pricing structure was not in response to Google, but something that had been in the works. That makes for a good soundbite, but the timing of the price cut suggests otherwise, or at the very least a plan to bump Google's cloud services off the news wires.
The price cuts target every Amazon offering. The popular storage service, S3, will see a cut by an average of 51 percent. The EC2 will see its price dip by about 38 percent. Older instances of the service will see cuts in the 10 to 40 percent range.
Users of Amazon's RDS database service can expect a drop of 28 percent, while Elasticache will be knocked down 34 percent.
The beneficiary of the price wars between the two tech giants is the consumer. The race to the bottom in pricing should help bring business back to the cloud in the wake of the NSA scandal last year.
Amazon is also being helped by the recent DOD clearance for its cloud computing. It will need it in the face of lost revenue as it battles Google in the cloud space. The stock is facing headwinds today as the tech sector struggles to find its footing.
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