One day after Google announced a substantial price reduction for their cloud services, Amazon announced their own dramatic price reduction on several AWS offerings. This move will reduce the revenues of one of Amazon’s most profitable services, the S3, by about 50%. What were the AWS leaders thinking just before Andy Jassy went on the SF summit stage?

This decision raises a few questions about Amazon’s market strategy. Why would a leading company willingly cut their successful stream of revenues so suddenly in light of a new competition? Aside from the profit loss, Will this move – stop the IaaS vendors’ race to zero? will it position GCP a notable player in the cloud arena, as AWS largest direct competitor.

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