Google's Move and the Cloud's Future

NEW YORK (TheStreet) -- Google's  (GOOG) announcement that it is officially a cloud service provider is not as big a deal as it first appears.

That's because Amazon.com  (AMZN) long ago made this a commodity business. Telcos, Web hosts and even computer giants like IBM (IBM) and Hewlett-Packard  (HPQ) are already looking in dismay at the shredding of their business plans resulting from Amazon's decision to price its service at cost, and focus on relentlessly pushing those costs down.

Besides, Google has been offering its Compute Engine for 18 months now, and even though it has called that a "preview period" it has already drawn some big names like message eraser Snapchat, invitation company eVite and Web site builder Wix to the offering.

The big news here is that Google is now offering a Service Level Agreement for its cloud, promising 99.95% up-time. Given the fact that Amazon has had repeated failures at its Virginia center, one of which knocked Netflix  (NFLX) offline last Christmas Eve, that's a big deal.

Google is also claiming its cloud is easier to use, that it can get an application up and running in three minutes. It has already built an impressive list of "service providers" around the service, what the market will see as re-sellers.

All of this means the present shake-out among cloud providers is only going to accelerate. It's no longer a question of supporting a particular infrastructure system because Cloudscaling makes OpenStack clouds compatible with Google, much as Eucalyptus makes private clouds compatible with Amazon.

We already know that price sells cloud. Amazon retained its market share lead in the third quarter, according to Synergy Research Group, and is now bigger than its four-largest rivals combined.

Synergy listed those main rivals as Google, Microsoft  (MSFT), IBM -- which acquired SoftLayer to get that share -- and Salesforce.Com  (CRM), whose Software as a Service offering is based on Oracle  (ORCL) hardware and software.

If you liked this article you might like

Why Alex Rodriguez Is Investing in Billionaires Warren Buffett and Jeff Bezos

Former NY Yankees Slugger Alex Rodriguez Reveals One Juicy Investment Tip

Why I Love Apple, Alphabet, Nvidia and These Other Stocks for September

Have Amazon, Google, Apple and Sony Flooded the Smart Speaker Market?