Forbes | May 28, 2014

Forget Price. The Real Cloud War Is About Features

Amazon Web Services (AWS), Google, and Microsoft have been consistently dropping their prices in the battle to become the low cost provider of compute, network, and storage cloud services. You can bet that if one of them drops their price, the other two will announce price reductions within days. The reality is that the consumption of these core cloud services has become commoditized. The real differentiator is the features that provide agility to developers. IaaS (Infrastructure as a Service) public cloud providers are in a war to create the best platform for developers to quickly build and launch applications. There are two key categories of features that they are focusing on to win the hearts and minds of enterprises: hybrid clouds and PaaS (Platform as a Service) capabilities.


Building the bridge between public and private clouds

For startups and small or midsized companies, public clouds are a no brainer. These companies don’t have large investments in data centers or the people needed to run them. SMBs also have more limited IT budgets. Enterprises, on the other hand, have complex heterogeneous environments with years of legacy, tons of existing infrastructure, and cultures that are used to owning and controlling infrastructure. In order to get a foot in the door of large enterprises, public cloud service providers are implementing new services that allow enterprises to build hybrid clouds.

AWS has led the way while its competitors try to catch up. AWS offers a collection of APIs to assist in moving workloads between private datacenters and the AWS public cloud. Direct Connect provides a private, dedicated network connection between your datacenter and the AWS cloud. AWS also offers the AWS Storage Gateway to provide seamless integration for securely storing data in a hybrid cloud architecture. Documentation on AWS is also extensive. AWS has published numerous best practices for using their APIs for providing disaster recovery capabilities.

Microsoft has made strides to keep up with AWS, recently announced ExpressRoute which is their equivalent to AWS’s Direct Connect and also releasing Azure Files as their sharing file systems. Microsoft also announced major enhancements to Azure Site Recovery, a hybrid disaster recovery solution.

Google’s public IaaS offering, Google Compute Engine (GCE), recently launched this January. Expect to see them announce APIs in the near future to match the hybrid capabilities that AWS and Microsoft offer.

One advantage that AWS has over its competitors is its partnership with Eucalyptus. Eucalyptus is a private cloud solution that has AWS compatible APIs. The combination of AWS and Eucalyptus gives developers a common development platform to write applications that work seamlessly whether the work loads are running in public or private clouds.

IaaS providers are morphing into PaaS providers

There are many pure play PaaS companies that abstract the underlying physical infrastructure like IaaS providers, but also abstract the application stack made up of web servers, application servers, database servers, and a collection of programming languages. The power of PaaS is to hide all of the complex “IT plumbing” work required to scale, secure, failover, and meet all of those hard technical requirements that take developer time away from building business functionality.

IaaS providers have been adding many PaaS-like APIs to their portfolios to complement their network, compute, and storage APIs. Without officially announcing it, these IaaS players are gradually becoming powerful platforms. AWS, Microsoft, and Google offer APIs that target gaming, mobile, streaming media, and database as a service capabilities to name a few.

Each of these big three have a different strategy for growing their service offerings. AWS prefers to build all of their APIs internally. They are able to innovate quickly and release new APIs to the market place better than anyone. Microsoft has a build and partner approach. They have built a number of APIs to try to keep up with AWS and recently partnered with Apprenda, a pure play private PaaS provider. This partnership gives them a hybrid PaaS offering, something that AWS and Google currently don’t have.

Google has taken the build and buy approach. On top of delivering several unique APIs in the areas of big data, mobile, and integrating with their own PaaS, Google App Engine, they recently purchased Stackdriver, a cloud monitoring service. Expect Google to play catch up by purchasing more companies that fill the gaps in their offering.


The battle for enterprise dollars has moved past price and is now all about features and speed to market. The public IaaS cloud provider who can make the transition to hybrid clouds simple while adding a suite of APIs for developers to build application faster will be in the best position to win. While AWS has a huge lead in the depth and breadth of APIs it offers to developers, I predict Google and Microsoft to continue to buy and partner with companies in an effort to catch up.