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Cloud Price Battle Turns to Object Storage

By Lynn Haber
April 20, 2017 - News
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The latest cloud pricing pressure is focused on object storage, according to the most recent Cloud Price Index from 451 Research. This latest trend reflects object storage’s move into the mainstream and takes the spotlight away from virtual machines (VMs) pricing wars.

According to the research group, object storage pricing has declined in every region by about 14 percent over the past 12 months. VMs, by comparison, declined by 5 percent over the same time period. The Cloud Price Index from 451 Research provides a comprehensive analysis of the cost of cloud computing and is updated quarterly.

“The big cloud providers appear to be playing an aggressive game of tit for tat, cutting object storage prices to avoid standing out as expensive," said Jean Atelsek, analyst, Digital Economics Unit at 451 Research. “This is the first time there has been a big price war outside compute, and it reflects object storage’s move into the mainstream. While price cuts are good news for cloud buyers, they are now faced with a new level of complexity when comparing providers."

The increase in heat in the object storage area was identified in Q3 2016 by the 451 Research when it first noticed a reduction in IBM SoftLayer’s object storage prices which was quickly followed by cuts from Google, AWS and Microsoft.

A maturing market is leading to price cuts that move beyond compute, according to 451. Other factors include increasing cloud-native development and faith in the cloud model, as well as a competitive scrum to capture data migrating out of on-premises infrastructure.

Given that nothing stands still in the cloud computing realm, the research group suggests that other services, such as databases, in particular, will be the next in line to undergo similar pricing pressures during the next 18 months.

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