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Cloud Storage: The Race to the Lowest Price?

Hard drives continue to drop in price as the capacities increase. Chances are that a drive you’re looking at now will be cheaper a few months down the line. The storage scene is changing and expanding so rapidly that hard disk drives are very low-cost compared to their initial price when they first came onto the market. Solid state drives are the more expensive option, but even they are slowly dropping in price over time.

A similar sort of effect is happening with cloud storage. Some cloud providers have now dropped free storage plans as they can’t justify it cost-wise. The cloud giants on the other hand, like Google, Microsoft or Dropbox, still continue to offer free packages for individual users. Although the money is made through enterprise, these companies evidently still believe that the usage and marketing gained from these free packages is worth it long-term.

These companies also offer paid plans, offering increased storage capacity and sometimes additional features. It has now become a recent trend to see these companies slashing their prices in order to keep in line with competitors. In the storage world it is quite tricky to differentiate, thus dropping the price is one of the popular techniques.

Google recently created an offer with one of their partners, Panzura, to offer two terabytes of free storage for a year on their Google Cloud Platform. Panzura is a firm that helps companies remotely store their data in Amazon, Google and Microsoft data centres and offers tools to let them access the files from multiple locations using existing software. The offer that Google have put out covers one location access, with enterprises having to pay Panzura for multiple-point access (although the storage from Google stays free).

This offer has been created to encourage businesses to move more of their computing to the cloud. Whereas previously many offers have been carried out in gigabytes, the two firms hope that the double terabyte offer will be very enticing.

“This is a way for customers to try something new, especially if they have had some kind of aversion to using the cloud in the past,” said Chris Rimer, the global head of partners at Google’s Cloud Platform business.

According to the Wall Street Journal, some industry insiders predict that storage may soon be free. It’s perhaps hard to imagine, but it might be a cost-effective move if free storage helps promote other tools in corporation’s infrastructure.

“Storage is a race to the bottom on pricing,” said Rajesh Abhyankar, the CEO of MediaAgility, a cloud consulting firm that assists Google. “The money will be in software and services that sit and run on top of these companies’ cloud platforms.”

“Google is trying really hard to catch up with [Amazon’s cloud service],” he continued. “These types of offers may persuade users to move their data.”

In March 2014 research firm Gartner estimated that company spend on outsourced computing service, like those that Google and Amazon offer, would rise by 45% this year to $13.3 billion. It’s a lucrative market and you can see why Google are keen to capture it with offers such as these.


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