GOOGLE HAS TRIGGERED the opening salvo of a price war by announcing it is cutting the prices of its cloud services by 10 percent with immediate effect.
The announcement reflects a move by Google to make enterprises more aware of its cloud computing capabilities, going beyond Google Drive to application of big data and virtualised environments.
In a blog post, Google SVP of Technical Infrastructure Urs Hölzle said, "We believe that compute - the core of any cloud workload - should be simple and fast to provision, scale without effort, and be priced in accordance with Moore's Law.
"In March of this year we set a new standard for economics in the public cloud when we brought the price of core infrastructure, including compute & storage, in line with where it should be."
For readers unfamiliar with Moore's Law, it is a theory coined by Intel co-founder Gordon Moore that posits that the total number of transistors in dense integrated circuit semiconductor devices doubles approximately every two years.
Hölzle goes on to explain that by further employment of Moore's Law, a further 10 percent of the cost savings are being passed on to customers.
During a Reddit AMA earlier this year, Intel CEO Brian Krzanich was asked about the end of Moore's law, long expected by many analysts, and responded, "At any one point we can typically see about 10 years out, with pretty good clarity in the three to five years and much less clarity five to 10 years. But so far in that 10 year horizon, we don't see anything that says it will end in that timeframe."
In reality, Google's price cuts come back to a hearts and minds strategy to bring aboard businesses to use Google's cloud capabilities from end to end, an initiative that Google began last month with the launch of Google for Work, a rebranding that encompassed all aspects of Google's infrastructure, from Chromebooks to big data.
Google's main competitors in the cloud services market such as Amazon Web Services are yet to announce their responses, but doubtless they will in the coming days. µ
Some deliberately, others through stupidity
Quite the business expense
It's another quantum leap camera
Evolution, not revolution, but that's just fine