Cheaper Rates On Google's Cloud Service May Have A Rippling Effect
March 17, 2014

Cheaper Rates On Google’s Cloud Service May Have A Rippling Effect

Enid Burns for - Your Universe Online

In a move that will undoubtedly change the industry, Google dropped the price of its Google Drive service. Competing cloud storage services are expected to follow suit with lower pricing plans.

The Internet search giant offers up to 15 gigabytes of storage for free, which isn't changing. The Mountain View, Calif.-based company said it will lower the prices on larger capacities, in a post on the Google Drive blog. For 100 gigabytes of storage users will pay $1.99 per month, which was previously available at $4.99 monthly. A one-terabyte capacity will cost users $9.99 -- a significant decline, as users were paying $49.99 per month. Power users, or businesses, can get access to 10 terabytes per month for $99.99, and Google will work on deals for even larger capacities.

Prices will automatically adjust for current subscribers paying for cloud space with Google Drive.

By comparison, Dropbox charges $9.99 per month for 100 gigabytes of space and SugarSync offers one terabyte of data for $55 per month, TechCrunch reports. Apple charges $100 per year for 50 gigabytes.

Google's new prices are competitive with the market, and even its own services offered under another umbrella.

"Maybe even more importantly, Google's new prices even significantly undercut those of its own cloud storage platform for developers, as well as those of Amazon's S3 and Microsoft's Azure storage platforms. That's where most cloud storage startups host their files (Dropbox uses S3, for example). Those startups that are big enough probably get some discounts for storing extremely large amounts of data on these platforms, but even then, Google's price for consumers is lower than what developers can get on these platforms," wrote Frederic Lardinois of TechCrunch.

New prices for cloud storage from Google will call for change in the industry, CNET reports.

"The move signals a clear, ruthless investment by Google. And when a giant like Google makes a push like that, it reverberates through the entire ecosystem, and the other players have no choice but to react," wrote CNET's Richard Nieva.

In the past, competitors have had to keep up with Google as it's upped the ante on services such as Gmail and Google Docs.

The pricing adjustments to Google Drive could be a way to woo new subscribers in a difficult climate. Recent reports find that foreign businesses are reluctant to use US-based cloud services, largely due to controversial surveillance techniques conducted by the National Security Agency.

Just last week IBM was under the lens amidst allegations that it provided data to the NSA, which the company denied.

Google, among other US cloud service providers, may be feeling pressure to grow its subscriber base. It is possible that Google's competitors will soon change their prices for cloud storage.

"The price trend for developer cloud storage has always been moving down and Google, Amazon and Microsoft have typically matched each other’s price cuts, so over time, those consumer prices will surely match the wholesale prices again — but probably not for a long time to come," wrote Lardinois.