Race to Zero: Reduced Costs of Cloud Storage and Services

As the market for cloud computing continues to expand, customers can expect to pay less for more. Increased competition in cloud computing is leading to greater storage at lower prices. And at the given rate at which customers are being offered lower prices, tech companies await their greatest challenge — “the race to zero” — or the moment when unlimited storage will be available at no cost. Amazon is one of the first companies to reflect this trend with the cost of its Web Services.

cloud_02_smallIn the past six years, Amazon has reduced the price of its Web Services on 45 different accounts. Amazon uses a lower priced cloud service as a base for which customers can add additional services for additional costs.

As Business Insider suggests, Amazon “is treating computer services like a retail store. You are more likely to stock up your cart with more stuff if you are getting a bargain on every item you buy.”

Cloud service prices are declining simultaneously with the cost of storage. “A gigabyte’s worth of storage on a hard drive in 1993 cost more than $9,000, but it cost a mere 4 cents in 2013,” notes BI.

As we get closer to free and unlimited cloud storage, companies such as Box, Dropbox, Google and Microsoft have taken the initial step towards offering customers additional features to the cloud storage services they already provide. Box’s version of cloud storage offers additional security of files, while Google and Microsoft’s cloud services come equipped with Office apps.

Those new to the cloud-computing market also find themselves looking to explore cloud services beyond the basic storage capabilities. In recent years, tech companies such as Oracle, Cisco and HP have vowed to invest billions in cloud computing.

Despite any claims by these companies to avoid joining the likes of Amazon in “the race to zero,” price and value still seem to matter. And as long as both matter, Amazon will continue to push higher value at the lowest price possible for its Web Services.