Major cloud service providers (GCP, Azure, AWS) have approximately similar pricing for equivalent features.
If Amazon’s quarterly earnings are any indication cloud offerings is a high margin business with a huge potential to grow.
Storage
Google one offers storage of 100GB at $1.99/month and 2TB(20*100GB) at $9.99/month (5*1.99). 2TB Storage drive costs around $60 and last for around 10 years. This is a huge margin for storage providers to buy a product that costs $6 per year and charge $120 / year. Obviously there are other costs involved:
Cost of goods:
Product ($60)
Datacenters and their maintenance
Other costs
Sales and marketing
R&D
Most of the above costs can are shared and usually make up biggest source of costs, and cost of good itself is negligible compared to other costs. This is one of the reasons why price of higher tiers seem like a better deal to customers.
Storage device industry is a commoditized industry with prices dropping as a result of that.
Compute
Compute (compared to storage) is not a highly commoditized market and there are relatively few players in the market. AMD, Intel are the major players. Most cloud providers are either designing their own chips (Amazon Graviton, Google TPU) or are planning to design their own chips. This allows them to control the margin from compute and avoid wholesale transfer pricing to Intel/AMD.
New demand from these new chip designers will be fulfilled by a very few foundry (TSMC, Samsung) and TSMC particularly is in a great place because it is the complement to the new commodity market (chip design)
If we go one level deeper ASML is in a even better position to be the only company to supply EUV machines to foundries (TSMC, Intel, Samsung, etc..)
Pricing
Given that cost of goods (cpu price / storage disk price) is negligible compared to other costs it is surprising that almost all cloud providers prices are very close to each other. It is unlikely that all the cloud providers’ other (Sales, R&D, Administrative ) costs are equal.
Cloud storage is becoming more and more popular, and at the same time security issues are being discussed more and more. Backups are becoming a way for more and more people to deal with challenges.