A new round of price wars in the cloud service market is underway. Following Alibaba Cloud’s announcement of a comprehensive price reduction for its core products, Tencent Cloud also announced on May 16 that it will reduce prices for multiple core cloud products, with some product lines seeing a maximum reduction of 40%, starting from June 1.
In this price reduction plan, Tencent Cloud will further increase the discount for some regional cloud server instances, with the highest price reduction reaching 40%.
In terms of cloud computing, Tencent Cloud has reduced the LCU fee for load balancing CLB by 18% and lowered the price of standard NAT gateway by 15%. In terms of databases, Tencent Cloud’s TDSQL-C serverless has launched a new resource package payment model with a listed price that is up to 25% lower than that of similar annual/monthly subscription products.
According to an analysis by 21st Century Business Herald, the price reduction trend led by Alibaba Cloud and quickly followed by Tencent Cloud has also sparked a new round of price wars in the cloud computing industry. An industry insider said that this round of price cuts by cloud providers may be different from previous subsidies for market share, as companies are now emphasizing sustainable development and will not sacrifice profits like they did in the past.
Besides lowering prices, Alibaba Cloud and Tencent Cloud have also respectively launched some free services for users. Previously, Alibaba Cloud launched a free trial plan, providing free trials of core cloud products to developers on the cloud. Tencent Cloud also proposed that the basic version of Tencent Cloud Host Security will be open to small and medium-sized enterprises across the network for free, while also opening up asset management and one-click health check capabilities for free.
For relatively homogeneous basic cloud products, price is still an important factor affecting customer decisions. With the arrival of this wave of price cuts, the cost for enterprises to conduct cloudification will be further reduced.