Google Has Cut Cloud Prices 38 Percent in 2014: Google vs AWS Pricing

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Update May 19, 2015: Google cut prices on compute resources again this week. We’ve got the latest analysis on Google vs. AWS pricing along with price comparision charts.

Just six months after large cloud price cuts from Google and AWS, Google has cut prices for compute resources by ten percent across the board, making good on its promise to drive cloud prices down further. This makes a cumulative reduction of 38 percent in Google Compute Engine (GCE) compute prices since the beginning of the year.

It is highly likely that AWS has price cuts of its own coming soon. This move by Google is just six weeks before AWS re:Invent, the AWS user conference that drew 9,000 attendees to Las Vegas last year. For the past two years, AWS has announced a price cut during re:Invent, so cloud watchers can debate whether AWS will move up any planned pricing changes or wait to make a big splash during its big event.

After these price cuts, GCE is the low-price leader for on-demand instances. In the case of longer-term usage, GCE sustained-use discounts undercut AWS 1-year reserved instances (RIs) for high-CPU instances, while AWS 1-year RIs offers lower prices for standard- and high-memory instances. Customers committing to AWS 3-year RIs will still see a significant cost benefit compared to GCE. It is important to note that the GCE sustained-use discounts and AWS RIs are not a direct apples-to-apples comparison, since AWS RIs require an upfront commitment, and RI hourly pricing may or may not follow future price cuts in AWS on-demand pricing.

In addition, AWS also offers twice the memory on the high-CPU instances, along with an SSD, that balances Google’s lower price. Depending on workload, the highcpu c3 series from AWS could provide a better price/performance option.

The price comparisons in the charts below are based on Linux in AWS US-East and Google in the U.S.:


Once again, CIOs and CFOs are going to have to take a hard look to costs of internal data centers, given that there is no slowing in the march toward lower cloud prices. The RightScale 2014 State of the Cloud Report found that most enterprises are implementing multi-cloud strategies that can enable them to pick and choose cloud providers based on price, features, and other factors.

Accurately forecasting cloud usage and evaluating the myriad cloud pricing options is quickly becoming a must-have skill for IT finance practitioners. If you want to analyze the impact of cloud prices on your own cloud spend, get a free trial of RightScale Cloud Analytics to analyze your past cloud usage and create scenarios to forecast future spend with the latest prices on Google, AWS, and other clouds.

With RightScale Cloud Analytics you can optimize your cloud costs by running scenarios to compare different instance sizes, reserved instances,
and alternate clouds.