Google's IaaS launch won't faze Amazon

Google recently announced it has made its Compute Engine infrastructure-as-a-service (IaaS) cloud platform generally available.

Compute Engine services were launched during a limited preview in July last year, but the services are now available to general customers. At its core, the service lets customers create virtual machines and use virtual storage to take advantage of Google's extensive computing power.

To accompany the full-scale launch, Google has reduced prices for its standard Compute Engine products by 10%, lowered the price of Persistent Disk storage services by 60% per GB and dropped additional I/O storage charges.

In a blog post announcing the launch, Google Vice President Ari Balogh added that Compute Engine customers can now run any out-of-the box Linux distribution, as well as any kernel or software. Google is also adding support for Red Hat Enterprise Linux and FreeBSD. During the limited preview, Compute Engine only supported Debian and Centos and a customised Google-built kernel.

Many pundits and media commenting on the public launch have suggested that Compute Engine is Google's attempt to take on the ever-popular Amazon Web Services (AWS). But IBRS advisor Kevin McIsaac does not believe that Amazon will be worrying just yet.

"Amazon has a lot of services that Compute Engine doesn't have today, so I don't think it's going to be a big threat," he said.

Google's Compute Engine is also unlikely to make waves in Australia, as the company currently lacks a local data centre, McIsaac added. "Without an Australian data centre, most enterprises wouldn't come to use it."

Nor does it yet have the kind of services to pose a threat to other major enterprise cloud platforms. "I don't see it being a major threat to [Microsoft's] Azure or to the big VMWare vCloud players for large enterprises," McIsaac said.

The target market is more likely to be smaller organisations that want relatively straightforward services. These customers might consider Compute Engine instead of contracting with a tier 2 web host. Accordingly, he said the service poses the bigger competitive threat to smaller web hosts and similar service providers.

Another use case is for companies looking to build complicated applications that revolve around other Google products. "If you are going to build something that you want great integration with Google's APIs, with Google's App Engine, then I think that's going to be the market for this," McIsaac said. He gave the example of companies looking to build a CRM or value-added add-on to products that make use of Gmail accounts.

Compute Engine is ultimately, therefore, still a niche product, and Google would have an uphill battle trying to take on the likes of AWS. But McIsaac said a showdown with Amazon is likely not in Google's game plan.

"If [Google's] goal is to dominate the IaaS market, there's a lot of work to do. But I don't think that's the goal," he said. "I think the goal is to provide a complimentary product. I think they're going to get good traction for what their trying to achieve, but it's not about a battle with Amazon."

Pictured: The Google Compute Engine logo recreated in a latte, courtesy of Yuko Honda under CC.