Big changes in the cloud storage market

March 17 News, Google's cloud storage services Google Drive in the last week ushered in a big price reduction, which will affect the overall market? Will other competitors respond? Technology Web site CNET recently analyzed this:

If anyone also suspects that the cloud storage business is a high-risk game, Google's actions last week have eliminated all doubts. The search giant has sharply reduced the price of its cloud-storage services, a surprise to consumers. Google Drive now provides 5GB of free storage, 100GB per month (from 4.99 US dollars) and 1TB to $9.99 a month (down from 49.99).

The move shows clear, decisive input from Google. When a giant like Google does this, it will certainly reverberate across the ecosystem, and other competitors have no choice but to respond.

In a busy market such as cloud storage, it seems a bit inappropriate to call Google's price reduction a turning point. Digital Content Storage This sound boring business in the past has been like IBM, the old technology companies are doing, but subsequently, box and Dropbox services such as the advent of the field has brought fresh blood.

The leaders of these two companies are young and, more importantly, their market capitalisation is very high--dropbox 10 billion dollars and box is 2 billion dollars. At the same time, Dropbox and Box also want to become big listed companies. It is rumoured that box will be publicly listed this year.

To be honest, Dropbox and box, as pioneers of the field, still have an advantage over experience. But Google's aggressiveness does show how unfair the fight IS. Since box and Dropbox have been around for 2005/2007 years-not to mention some of the less-well-known competitors-the tech giants have launched their own services. In addition to the 2012 Google Drive, Microsoft and Amazon have their own cloud storage services. Of course, Google, which has a 400 billion dollar worth of money, can change the pay structure of the market, but at its core, the 80% per cent price cut also validates the business model of those small companies.

But others are also clearly prepared for the situation, at least by the joint founder and chief executive officer of Box, Aaron Levie. He has yet to comment on the incident, but in April 2012, when Google Drive first came out, he wrote:

"In the end, we think there will be a fierce price war on consumer online storage services, and in that respect we cannot compete in the presence of Google, Microsoft and Apple giants." Because of the potential user lock-in, they have a deep motivation to provide users with the hard drive in the cloud, and as storage prices continue to fall, we believe that the future of cloud storage services will be unlimited and free. That would not be a good start-up business. ”

It's not a good idea to be complacent in the ever-changing technology world. But if users have already kept their digital content-video, pictures, and documents-in a service, it's hard for other services to attract them, said Paul Hughes, an analyst with the storage Service, IDC. The hassle of migrating or learning a new interface is enough to scare off most users. "The obstacle is not coming in, it's quitting," he said. But when a user's subscription expires, things can become interesting.

From a purely economic point of view – the ratio of prices to storage space – Google's price cuts could potentially be damaging. However, different services also have their own characteristics, which are helpful in the retention of the user. For example, I am a word user, and I also like the sync function of Word and Dropbox. Google Drive does not have this functionality because Google Docs and Word are directly competing.

So what is Google's response? It could be the development and upgrading of features--image editing, photo uploading--everything that makes users feel good enough to reject other attractions. And the more fascinating side effect is that small companies are pushing harder on marketing. While existing users are somewhat loyal, attracting more new users is clearly a more important task. "Cloud services will focus more on individual functions and more specific programs," says IDC's Hughes. "I'm pretty sure that cloud service providers will soon start offering price comparisons online," he said. "Over time, cloud storage becomes more and more commercialized, like traditional telecoms services." Once you get to this point, the price war will really go off. ”

Dropbox has not yet responded to the matter, but announced in Friday that it would hold a conference next month to introduce a "new chapter" of the company, perhaps a response to Google.

In any case, if the activity is related to price, the most promising companies in the cloud storage market will have a big change.