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The Dawn of Cloud Storage Commoditization

Every 6 months or so, one of the major cloud storage providers drops their prices

In the cloud storage industry, we talk a lot about “price wars.” Every 6 months or so, one of the major cloud storage providers drops their prices, and everyone else follows suit. Well guess what?

Game over.
Perhaps you’ve heard Google dropped the cost to $0.026/GB per month for standard storage (GCS) and $0.020/GB per month for DRA (Durable Reduced Availability). Of course, there will still be more price drops here and there, but fundamentally we’ve reached the point where cloud storage has effectively been commoditized.

business failure concept

As a result, you may be wondering about the impact to the market and to cloud storage customers.

Truth is the commoditization of cloud storage was as inevitable as the commoditization of disk drives. I’ve always said the real value of cloud storage is in software that controls it: the cloud-integrated storage controller or cloud storage gateway. It’s the software that enables organizations to solve their difficult storage issues: growing and maintaining their current NAS and SAN systems, preventing sprawl and having a disaster recovery plan that meets their objectives.

Price drops should be no surprise in the world of cloud storage. In fact, they are a core part of the value proposition. When you purchase traditional storage, you buy storage for the next 3-5 years at today’s prices, knowing that prices will be significantly lower when you finally utilize all of the storage — there are no rebates or credits for unused storage or delayed deployment. With cloud storage, on the other hand, you pay for what you use and when prices drop, not only does your next allocation of storage cost less, but your existing operational costs drop as well. This a very powerful concept in the world of traditional storage dominated by 3-5 year replacement cycles that perpetuate economic inefficiencies.

As far as the market impact, there are winners and losers with any price war, which explains why we designed our CloudArray cloud-integrated storage to work with virtually every cloud provider and easily migrate data between clouds. Freedom of choice is a very powerful thing. We wanted to make sure that regardless of the outcome of any price wars, the customer always wins.

The verdict: Enjoy the improved economics of cloud storage. And take comfort in knowing this certainly will not be the last price drop.

The post The dawn of cloud storage commoditization appeared first on TwinStrata.

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More Stories By Nicos Vekiarides

Nicos Vekiarides is the Chief Executive Officer & Co-Founder of TwinStrata. He has spent over 20 years in enterprise data storage, both as a business manager and as an entrepreneur and founder in startup companies.

Prior to TwinStrata, he served as VP of Product Strategy and Technology at Incipient, Inc., where he helped deliver the industry's first storage virtualization solution embedded in a switch. Prior to Incipient, he was General Manager of the storage virtualization business at Hewlett-Packard. Vekiarides came to HP with the acquisition of StorageApps where he was the founding VP of Engineering. At StorageApps, he built a team that brought to market the industry's first storage virtualization appliance. Prior to StorageApps, he spent a number of years in the data storage industry working at Sun Microsystems and Encore Computer. At Encore, he architected and delivered Encore Computer's SP data replication products that were a key factor in the acquisition of Encore's storage division by Sun Microsystems.

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