A price war is under way among Amazon, Google and IBM in the market for cloud services that makes running your own data center nearly impossible to justify.
This week, IBM took out several ads trumpeting its cloud market share. Following quickly on the heels of IBM’s announcement, Google announced the “general availability” of the Google Compute Engine, a direct competitor to Amazon Web Services’ Elastic Compute Cloud.
Along with the upgrade of its service from beta to general availability, Google also announced three new features of its infrastructure-as-a-service offering: lower price, greater Linux support and the Docker “container-as-a-service” platform. What’s going on? Let’s examine each of these developments and then consider the ramifications.
Google dropped its prices by 10 percent for the most popular IaaS compute instances and 60 percent for disk storage. Price competition for IaaS services is continuing to heat up, with many sites calling it a “cloud price war.” In fact, 12 hours after Google’s announcement, AWS announced a 26 percent drop in prices for its Windows virtual machines.
The second leg of Google’s cloud platform announcements introduced increased Linux support for any “out-of-the-box Linux distribution” to include SELinux, CoreOS, SUSE, FreeBSD and Red Hat Enterprise Linux. At the same time it should be noted that Linux Virtual Machines are cheaper and therefore more popular in the cloud than Microsoft virtual machines.
One interesting and possibly unique feature of the Google Cloud Platform (at least amongst its main IaaS rivals) is support for the Docker container-as-a-service platform. Linux containers are a form of “operating system virtualization” or an application container that enables each application to have its own environment as if it were the only application running on the system (its own file system, memory space, system libraries, etc.).
These containers are more efficient than machine virtualization, so IT managers can run many more simultaneous containers than they can run virtual machines. Additionally, containers spin up instantly unlike the boot time of operating systems that take minutes.
Thus, containers are a real threat to IaaS vendors that only support virtual machines. Docker is an open-source project that is making containers easier to use, more secure and more portable. Though only a small footnote in Google’s announcement, Docker support could prove more valuable than all the other announcements.
Now let’s briefly shift back to IBM and its battle to gain traction in the IaaS cloud space. In this month’s Fortune magazine, IBM took out three full-page ads to announce: “IBM Cloud hosts 30 percent more top websites than anyone in the world” and “Whose cloud powers 270,000 more websites than Amazon?” and “IBM Cloud supports 24 of the top 25 Fortune 500 companies.” These lofty claims seem more like cherry-picking the facts given the common knowledge that Amazon leads the IaaS/PaaS markets by a wide margin.
For the customer, this hyper-competition is a good thing. The price war is part of the drive toward cloud computing as a commodity with prices impossible to ignore. We are approaching price points that make running your own data center sound as foolish as running your own electric power plant.
So, I say, keep up the fierce competition!
Michael C. Daconta (email@example.com) is the Vice President of Advanced Technology at InCadence Strategic Solutions and the former Metadata Program Manager for the Homeland Security Department. His new book is entitled, The Great Cloud Migration: Your Roadmap to Cloud Computing, Big Data and Linked Data.