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March 27, 2014

Amazon, Google Cut Prices on Cloud Computing

Cloud computing customers will get a happy surprise on April Fool’s Day from Amazon.com (News - Alert), no fooling.

Amazon.com will lower prices on most cloud computing services as of April 1 – with the affected prices being between 10 percent and 65 percent lower than before.

The reductions follow a similar move by Google (News - Alert). The price cuts by Google, which were as much as 85 percent lower, are an effort to take market share away from Amazon.com, which leads the cloud-computing sector. Before the latest price cuts were announced by Amazon.com, it was reported by The Wall Street Journal that the Google price cuts made “Google’s on-demand Compute Engine service 37 to 60 percent cheaper than AWS’s competing service, known as EC2.”

Andrew Jassy, senior vice president of Amazon Web Services (News - Alert) (AWS), said the Amazon reduction is the 42nd one since the service was first offered eight years ago. Jassy also noted how AWS has five times the computing power of its 14 rivals combined, Reuters reported. "When you look at all those capabilities, they don't exist anywhere else," Jassy said.

However, AWS is getting more competition in the sector. Cisco Systems (News - Alert) will spend $1 billion over the next two years on a new cloud services business.

In another recent announcement, the U.S. Department of Defense will use Amazon's cloud computing offerings more, after being impressed with its security. “After receiving an overwhelming response from defense agencies interested in leveraging our FedRAMP Authority to Operate (ATO), we’re very excited to further extend our services to the government community by meeting the additional requirements of the DoD [Department of Defense],” Teresa Carlson (News - Alert), vice president, Worldwide Public Sector, AWS. “Today, more than 600 government agencies use AWS services, and we look forward to continuing to demonstrate the security and reliability of the AWS Cloud so that an even broader set of DoD customers can use our services to reduce costs and innovate for their missions.”




Edited by Cassandra Tucker
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