Google’s Chance to Dominate the Layer Above Amazon Web Services (and how their pricing sabotages them)
What is Google’s problem that they don’t know how to charge correctly for their APIs and web services? They’re squandering a potentially huge new global business.
Some ridiculous pricing examples:
As pbz said on Hacker News “Google has only two dials: free or expensive”
- Google Analytics Premium starts at $150,000/year.
- Google Commerce Search starts at $25,000/year.
- Google Maps costs $4 – $8 CPM (above the free tier).
- Google App Engine pricing went from $360/year to $4,000/year for some users.
These are ridiculous prices, and it’s a result of Google not having a comprehensive and well thought out strategy around their APIs and web services.
Just Copy AWS, Damn it.
It’s not really that hard either. Bezos already paved the way. Stop giving away the farm, then panicking, and trying to charge massive amounts to make the math work.
Instead, create very low free tiers and charge almost everyone. Any real business that uses Google Analytics would happily pay a bit of money for it. Even keeping it free for low-traffic sites it would be a huge new source of revenue.
Same thing with Google Maps. Instead of giving away 25k/req per day, give away 1k/req per day. That lets anyone get started for free, but means anyone doing anything serious needs to pay. Don’t charge them $4 CPM though, make it closer to $0.04 CPM.
Take the Layer Above AWS
Even though they missed the boat on infrastructure services (servers/load balancing), they still are in the best position dominate on the layer of services above that (analytics/maps/search/translation, etc). That’s where their skills outmatch anyone anyway.
Stop Treating it Like a Toy
Google could eventually make as much profit from their APIs and web services as they do from search. This could be what Microsoft’s business would have looked like had they been a web company. They’ve got the programmers to create every useful web service imaginable.
Instead of sticking all this stuff in “beta” or “labs” and ignoring it, start treating it like it’s as important as search is (speaking of which: offer a damn web search API again, and charge for it, you fools!)
I really hope Google’s business strategy will catch up with their technical skills. They have such a great opportunity in front of them and it would benefit the web immensely.