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Cloud Price Wars Give Way to Feature Battles Among Amazon, Microsoft and Google

The race to zero has become the race to supercomputer VMs in the cloud.

Two years ago the biggest battles in the IaaS cloud computing industry were over price. Amazon Web Services would drop prices one day, and Google or Microsoft would cut the price tag on virtual machines or storage weeks, days, or even hours afterwards.

It was a seemingly non-stop back and forth that caused some to wonder how low the prices could go.
Fast forward to today and providers are still dropping prices, but not with the same vigor and frequency as in 2013.

Constant jostling of prices doesn't grab headlines, nor the buzz of the industry like it used to. At AWS's most recent re:Invent conference it didn't even make a price cut announcement, which had become standard for any big AWS news event.

Something else has taken the place of price cuts though, and it could be even more beneficial to customers: a feature-war. Each cloud provider is trying to make their platform the most feature-rich of them all. Experts say it's a natural evolution of the market. "There's only so far you can drop prices," says

Rishi Vaish is vice president of product at RightScale, which makes software to control multiple clouds. "In the early days there may have been large margins, but after you cut those, you have to battle it out on features." And the battle has just begun.

The latest installment of this full-fledged feature war is evidenced by the latest virtual machine offerings from two heavyweights of this: AWS and Google. Each already have an extensive catalog of virtual machines instances that customers can pick from. But there is no resting on your laurels in the fast-moving cloud market. So these providers are beefing up their VM options, offering faster, more powerful, and more expensive, virtual machine instance sizes.

To kick off 2015 Microsoft announced that its latest and greatest G-Series of VM instances was available and ready to use. Unofficially referred to by some as gargantuan or Godzilla VMs, Microsoft calls them the "largest VM in the cloud." G-Series VMs offer up to 32 virtual CPUs and feature Intel Xeon E5 processors; and customer can spin them up and down on demand and pay by the hour for them. They come with up to 448GB of memory and a whopping 6.59TBs of local solid state drive space. These VMs eat databases for lunch.

The next week it was AWS's turn. The C4 Family of VMs that the company announced at its re:Invent conference last fall are now ready for prime time, AWS announced this week. The company worked Intel to create a customized processor for these VMs, the Xeon E5, code named Haswell.

It clocks in with a base speed of 2.9GHz and spins up to 3.5GHz thanks to a "turbo boost" that automatically kicks in when more juice is needed. "These instances are designed to deliver the highest level of processor performance on EC2," AWS chief evangelist Jeff Barr wrote on the AWS blog.

The C4s come in multiple flavors, but on the high end, the extra-large versions produce up to 36 virtual CPUs with 60GB of RAM.

(Just a note, the G-Series and C4 Family are not direct competitors. The G-series are meant to be used for highly transactional workloads, like databases, whereas the C4 are compute-optimized VMs).

Carl Brooks, an IaaS analyst at the 451 Research Group says cloud providers are being pushed to offer higher-end VM types by a variety of factors. Some hosting providers offer bare-metal (meaning not virtualized) servers on demand, which can pack hefty performance stats. "Combined with the upward march of CPU and server capacity generally, providers basically have no choice but to add more powerful machines over time," he says.

Google and other providers aren't standing idle either and VM instance sizes aren't the only features providers are sparring over. This month Google announced the beta release of Cloud Trace and Cloud Monitoring, tools that help developers identify the source of problems in their applications and an in-depth monitoring tool to track usage of Google's cloud.

At AWS re:Invent in November AWS threw down the gauntlet of new features (here are 10 of the best).

VMware has some big cloud announcements scheduled for early next month for its vCloud Air platform. Verizon, after a scheduled outage over the weekend, announced that its cloud now supports rolling updates, promising that it will never have scheduled downtime again.

The point is the IaaS cloud market is maturing past its early days of vendors competing on price to distinguish their platforms to now various players competing on more advanced features.




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