Cloud computing market thunders with Google, Amazon price cuts
Where there are clouds, there’s going to be thunder. And that certainly holds true for cloud computing. Google and Amazon.com this week created a lot of noise in the information technology industry when they slashed prices on their Internet-based services for businesses. On Tuesday, Google cut prices dramatically for its cloud-computing services, which allow companies to rent computing resources accessed via the Internet cloud. On Wednesday, Amazon responded with price reductions for its Amazon Web Services. Those actions are the latest in an ongoing price war where the major IT companies are battling to dominate the next-generation computing platform. Other players, including Hewlett-Packard (HPQ), IBM (IBM), Microsoft (MSFT) and Rackspace (RAX), have been cutting prices as well. RBC Capital Markets estimates that Amazon (AMZN) Web Services has lowered prices by 36% vs. early Q4 2013 levels, to an effective rate of $27 per gigabyte of RAM per month. Google (GOOG) has lowered pricing by 35% to $34 per GB of RAM per month over the same period, RBC said in a research note late Wednesday.