Google (GOOG) has increased the amount of free storage it is offering customers again in an attempt to compete with Amazon Web Services (AWS) and other competitors in the continuing game of price-cut leapfrog. Under the new pricing scheme, Google is offering customers 2TB of free cloud storage for a year through partner Panzura.
At this point, it seems to be clear that few cloud providers, particularly the biggest ones, are viewing cloud storage as much of a revenue generator at all. Instead, it increasingly is being used to entice users as a loss leader in the hopes they will sign up for more value-added and higher-margin services. It seems to be a strategy that is working well for cloud providers, but it has definitely had an impact on the storage market and the pure-play cloud storage providers out there.
As The Wall Street Journal noted, this update to Google cloud storage puts the company in a good light compared to AWS and Microsoft Azure (MSFT), which are not currently offering as much storage for free to customers. According to WSJ, comparable AWS service would put the price tag upwards of $120; and Azure's pricing is more than double that.
It seems clear that this is an attempt by Google to take customers away from its biggest competitors. Although Amazon is definitely the biggest target, Google also must have its eye on Azure, which has securely claimed the No. 2 spot in the infrastructure-as-a-service (IaaS) market and is building a presence and following that Google executives must be envious of.
But how does Panzura fit into this? The startup has partnered with Google to provide customers with access from a single location using Panzura's cloud service. It could provide Panzura a way to expand its own market, as customers may want to access the storage from multiple locations then pay Panzura for the capabilities. The storage is still free for a year, though.