Cloud service providers are playing a game of virtual limbo with their pricing strategies, as price cuts are announced by AWS, Google and now Microsoft within the past week.
Limbo is game that is commonly played at parties, social events, etc. Players are presented with a bar and they must be able to slide under the bar without touching the bar or falling down.
Each round, the bar keeps getting lower and lower until players are unable to slip under the bar, resulting in their demise within the game.
That seems to be a direct parallel to what cloud service providers have done over the past few years. When one service cuts its prices, the others either follow suit or make some sort of bold marketing claim.
In the latest edition of cloud pricing limbo, Azure has responded to AWS’s recent price cut with a price slashing of their own. In addition, Microsoft’s director of Product Marketing, Nicole Herskowitz writes:
“It is worthwhile to note that the Azure Dv2 instances – unlike AWS EC2 instances – have load balancing and auto-scaling built-in at no additional charge. This means you get even more value from Azure. In addition to delivering great prices, we provide further discounting and more flexible purchasing programs to support your journey to the cloud.”
Microsoft goes on to say that it has reduced prices by up to 17% on some services. The Azure blog also contains a table, breaking down the price reductions.
For example, D1-D5 virtual machines received a 10% price cut on Windows based machines while Linux VMs receive a 14% price reduction. For D11-14 instances, Azure has cut prices for Windows VMs by 13% and Linux VMs by up to 17%.
The new pricing announcements by Microsoft, AWS and others in the past week have certainly set the bar lower in the on-going game of cloud pricing limbo.
One big question remains: “How low can they go?”