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Google Case Study: Google Cloud Pricing Philosophy
Google Cloud Pricing Philosophy
Last year Google committed to continuously driving down costs for their customers in alignment with Moore’s law. Since then they announced three major price reductions and keep leading the industry in combining strong performance with low cost as well as flexible commitment-free pricing options. Google believes its cloud platform delivers better performance at a lower cost than other cloud providers. You may wonder how they are able to do this.
Firstly, they are creating infrastructure that’s tailored to your workload, not the other way around. Earlier this year Google introduced Nearline storage to dramatically reduce storage costs by up to 70% for many classes of content and data and more recently, we announced preemptible VMs – a new class of machine tailored specifically for stateless applications such as Hadoop processing and short-duration batch workloads. Preemptible VMs can lower your cost by as much as 70% compared to standard VMs and they’re perfect for adding firepower to data processing applications.
Secondly, Google provides you with the most appropriate billing plan so you can save on costs automatically. You shouldn’t have to spend hours or days calculating rate plans and different classes of machines. One of Google’s primary philosophies – they believe that the cloud should do that for you and for that reason, they pioneered a number of innovations in pricing including per-minute billing and sustained use discount options. For instance, these choices significantly lower your cost and are provided to you automatically.
Thirdly, Google does not force you to prepay to get the discounts you deserve. Signing long-term contracts reduces your flexibility in their rapidly changing environment as your business grows. The types of compute resources you need change as well, for instance, you may start off on a standard VM but as you grow – a new class of machine may result in dramatic savings reserved instance pricing or other prepay schemes lock you not only into the price but also into a machine class and a location. This works only if you don’t grow or if you have a very good crystal ball so Google gives you the flexibility of changing regions or classes of machines to meet your changing business demands – with no penalty.
Finally, Google is establishing firm price-performance benchmarks based on Moore’s Law so that infrastructure becomes more efficient and the price of the underlying hardware continues to decrease. They are committed to passing those savings on to you, so taken together – Google wants to make sure that our cloud platform provides the lowest total cost of ownership and the highest performance.
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