Google has come out swinging against IaaS (infrastructure as a service) rival Amazon Web Services in the latest salvo of the laaS pricing war. In a blog post, Google claimed its compute services are between 14 and 41 percent cheaper than AWS, even taking into account the pricing cuts AWS announced just a few days earlier.
Miles Ward, Global Head of Solutions for Google Cloud Platform didn't mince many words in his post, claiming:
While price cuts sound appealing on the surface, when you unpack the specifics of Amazon’s pricing model, it can be an unpleasant surprise. We often hear from customers who are locked into contracts and aren’t eligible for the new rates, or are stuck with instances that no longer fit their needs.
Google has certainly made the the notion of continual price reductions a major selling point for its IaaS, even coining the catch phrase "Pay Less, Compute Moore" and saying its pricing cuts will fall in line with efficiencies associated with Moore's Law.
Given the differences between various vendors' models for cloud pricing, as well as the many variables involved in their respective offerings, making an apples-to-apples cost comparison is difficult and getting more so by the day.
Also, as Constellation Research VP and principal analyst Holger Mueller notes, there is more for customers to consider than just how many compute cycles or terabytes of storage a vendor can sell them for how little money.
"Google has had the low-cost crown for almost two years now," Mueller says. "They are clearly cheaper and also in many aspects better in regards of IaaS capability. But they don't offer the variety of technologies and development options that AWS offers."
Indeed, AWS unveiled a rash of new capabilities at its re:Invent Conference in October. [See in-depth analyses of the event from Constellation Research analysts Doug Henschen and Holger Mueller right here, and right here.] Amazon showcased high-profile customers at the event, such as Capital One, which has thousands of developers working on AWS and is testing or using nearly every service. For customers like Capital One, the relationship with AWS is much more strategic—spanning IaaS and PaaS—than if it were merely rehosting applications there.
2016: When the IaaS-PaaS Line Blurs?
Expect a new entrant into the IaaS pricing wars this year in the form of Oracle. CTO and executive chairman Larry Ellison has already said Oracle will match Amazon and others on IaaS pricing.
During the company's earnings call in December he went further, saying that Oracle's own costs for running its IaaS are lower than any other vendor in the industry and that it plans to pass on those savings to customers. Sounds good, but at the same time, expect any price undercutting Oracle does to be met with corresponding moves from the competition.
Meanwhile, other announcements Oracle made in recent months point to what may prove a major theme of 2016 in beyond, namely the choices customers have to make when matching IaaS up with a PaaS (platform as a service).
Oracle, like Amazon, Microsoft, Google and IBM, obviously would like customers to take a one-stop shop, rather than mix-and-match approach, and the former naturally raises the specter of lock-in. But Oracle, like other vendors, hopes to mitigate that perception by promoting its Java-centric PaaS as a polyglot development platform, with support for Docker containers and language services for .NET, PHP, Ruby, Python and more. And on the other hand, what's considered lock-in to one buyer might be viewed as superior integration and simplicity to another.
Going forward, two outcomes seem likely. First, IaaS customers will need to be increasingly careful when making cost comparisons, given the constantly shifting competitive tides. Second, it will become more difficult to have buying discussions about IaaS and PaaS in isolation from one another.
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