Cloud Price Wars: Good News, But Only on the Surface

Written by Ike Syed

cloud price warsThis is an amazing time in cloud computing. Recently, we’ve seen dramatic reductions in the price of public cloud with Google and Amazon engaged in a high-stakes arms race to the bottom. How low can they go?

First came Google, with price cuts ranging from 32 percent for compute to 68 percent for storage. Back came Amazon, with reductions of 30-40 percent for compute and 51 percent, on average, for storage.

As Infoworld cloud computing blogger David Linthicum wrote, the two largest public cloud vendors are like a couple of carnival barkers, “standing on the sides of the strand, shouting out lower and lower prices for their services of luring major enterprises to their tents.”

A Note of Caution in Seemingly Good News

Linthicum adds a note of caution for those tempted to duck into one or the other of the companies’ tents. As he writes:

“Many cloud providers will jack up prices in a few years, once you’ve become dependent on their technology – a common practice for enterprise software providers. You should expect cloud providers to pull similar stunts.”

Ah, the old vendor lock-in problem, applied to public cloud.

Yes, the price wars appear to be good news for enterprise users who rely on public cloud, but lock-in and other concerns are lurking just beneath the surface.

That’s why a wise approach to enterprise cloud architecture involves a vendor-neutral, open-source Cloud Management Platform that not only keeps you from being tied down from one public cloud provider or another but also opens up other capabilities.

For example, as long as you’re using public cloud, it will pay to have dashboard capabilities that allow you clear visibility and control over resources. As we wrote earlier, public cloud costs have a tendency to creep up, mostly because of storage.

How Costs Rise With Public Cloud

Take for example the common problem of an excessive EBS snapshot policy. “Snapshotting” is a method of ensuring no data loss if a single component fails. Some snapshotting is necessary, but too much wastes money. There’s also the wasteful problem of “resource contention,” which forces you into buying larger Virtual Machine (VM) instances than you really need.

And then there’s the issue of project teams provisioning clusters of compute and storage capacity for a specific period and then not promptly shutting it down.
As prices go down, developers might be even more tempted than before to crank up rogue “shadow IT” operations that can trigger runaway costs, lack of governance and worries about security compliance.

The bottom line: Even with prices lowered, you’ll want to keep a close eye on usage. Out-of-control cloud bills have driven more than one company out of business.

Service Quality is Another Concern as Prices Go Down

Another thing to keep your eye on as public cloud prices get lower is the quality of service. We’ve already seen AWS outages affect companies like Netflix, Instagram, Pinterest and even Amazon’s own e-commerce capabilities.

It’s a case of getting what you pay for. At some point, you have to wonder what you’re really getting.

And, it’s yet another reason many enterprises are opting instead for a private or hybrid cloud approach. That’s where Connectloud can help.

Our uCloud™ Cloud Management Platform empowers enterprise IT with flexibility in the cloud. It makes implementation of private clouds faster than before – weeks instead of months, depending on hardware provisioning – and it makes multi-cloud orchestration seamless.

Even as public cloud prices go down, enterprises need to keep all their options open and easily available, and they need total visibility and control to maximize their resources.