Technology, Inc. (AMZN), Google Continue to Spend Away on Cloud Products, Inc. (AMZN), Google Continue to Spend Away on Cloud Products

Published By Blake Audett at October 19, 2016 10:11 am

RBC Capital Markets conducted a comprehensive positioning, product, and pricing analysis of the large public cloud platforms spanning a broad spectrum of pure plays. The firm writes in its research report that most changes in the third quarter were the product rather than pricing related. The only notable reduction in prices occurred at Internap, with minor alterations at Microsoft and Google post the third-quarter release.

There were some routine outages during the quarter seen at Google and Azure, but those were only faulty maintenance updates and technical malfunctions. Talking about capital expenditures in Cloud, the firm’s cloud capex tracker indicates that companies would expand their investments by 8% from current year’s $15 billion to $16.3 billion by the next two years.

Specific to companies, RBC Capital Markets made a note of Inc.’s (NASDAQ: AMZN) recent expansion of M4 — Amazon's latest generation of EC2 (Elastic Compute Cloud) general purpose instances. The e-commerce giant also announced a new P2 Instance type based on NVIDIA Tesla K80 Accelerators. Amazon Web Services launched a new three-year convertible reserved instance and region-wide applicability for RIs. The firm clarifies that these announcements do not impact its cloud use-case price comparisons.

Google also initiated a rebranding campaign that is targeted to enterprises. Part of this campaign would be to assess the cloud platform through enterprise products included in the “Google Cloud” brand. The technology maven also cut back on its pricing on Preemptible VMs by up to 33% on predefined machine types. However, this would only drive price reduction of 4% in RBC’s proprietary cases.

Microsoft launched a new N-Series virtual machines based on NVIDIA Tesla K80 Accelerators. New H-series instances for compute-intensive workloads were also launched, besides a “cool blob storage availability across all regions.” The company also lowered compute prices on Dv2 VMs by up to 15%, on A1 and A2 VMs by up to 50%, and on F-series VMs by up to 11%. The aggregate cloud price reduction translates to 4% measured against RBC’s use cases.

The investment firm has now included AliCloud pricings in its comparisons as well. Analyzing the investment firm’s comparison cases, AliCloud pricing is far competitive versus other large-scale public cloud peers.