Google opened its Google Compute Engine cloud service to the public on Wednesday, and now its strategy for competing with Amazon Web Services (AWS) is becoming clearer.
Like AWS, Google Compute Engine is an Infrastructure-as-a-Service (IaaS), which means customers rent the hardware for running virtual servers and the software to manage the hardware.
Many startups are running their businesses on AWS, and developers love it because they can sign up with credit card and start using it right away. Amazon is constantly cutting AWS pricing, and customers love that, too.
Google’s challenge is to come up with reasons to get AWS customers to switch. So it’s charging for Google Compute Engine on a per-minute basis (with a 10-minute minimum), as opposed to AWS, which charges by the hour.
In a Wednesday blog post, Urs Hölzle, Google’s senior vice president of technical infrastructure, said this billing model will let customers avoid paying for computing resources they don’t use.
Amazon offers multiple pricing options, such as reserved instances, which lets customers pay up-front for a set amount of computing capacity and get discounted hourly rates. It also lets customers sell their unused capacity to other customers in an online marketplace.
A Google spokesperson told Business Insider Google doesn’t currently offer these pricing options.
Google is also pitching storage as an advantage. Google Compute Engine supports up to 10 terabytes per disk volume, which is 10 times the industry average, according to Hölzle.
AWS has a maximum volume size of 1 terabyte, but customers can attach up to 70 disk volumes to a single virtual server.
Google unveiled Google Compute Engine at I/O last May and claimed it would be about 37 per cent cheaper than AWS. Microsoft is also getting into the action: In April, it launched its Windows Azure IaaS and vowed to match Amazon’s AWS pricing.
AWS is on track for $3.8 billion in revenue this year after making $2 billion last year, according to Macquarie Capital.
Disclosure: Jeff Bezos is an investor in Business Insider through his personal investment company Bezos Expeditions.