Amazon Web Services announced another round of price reductions in its services for data storage, processing and computing in the cloud, aiming for more business from application developers and companies. The reductions range as high as 37 percent for some services.
It’s the 19th time the company has lowered its AWS prices in the past six years. Given Amazon’s large presence in the market, these types of moves put pressure on competitors such as Microsoft, Google and smaller companies to further reduce their own prices.
The ongoing commoditization will also make more companies consider cloud computing vs. their own on-site servers.
“As we continue to find ways to lower our own cost structure, we will continue to pass these savings back to our customers in the form of lower prices,” writes Amazon’s Jeff Barr in a blog post. “Some companies work hard to lower their costs so they can pocket more margin. That’s a strategy that a lot of the traditional technology companies have employed for years, and it’s a reasonable business model. It’s just not ours.”
Shareholders might not like that message, but Amazon is traditionally a low-margin business anyway thanks to its roots in online retail.
Services affected by the reduction are Amazon EC2, Amazon RDS, Amazon ElastiCache and Amazon Elastic Map Reduce.