In a move that has left many of their competitors stranded, Amazon has announced that it will reduce the prices for two of its most popular storage products. The announcement that was made by the public cloud leader through a blog post will take effect from February and will affect the S3 storing of files service and the Elastic Block Store that holds information from databases. These price drops might seem too little but is actually substantial.  The customers who store more than 5000 TB on S3 a month will receive a 22 percent decrease, which is a reduction in cost per gigabyte from 5.5 cents to 4.3 cents.

Two new slices of physical servers that are able to handle computing workloads were also announced. These options are m3.large and m3.medium.They are good not only for legacy applications and databases, but they also have many other uses. The good thing about these instances is that they can be used on any applications not those that require heavy duty graphics or memory resources.

This drop makes it the 40th price drop by the company. The lowering of prices and launching of new features is a strategy Amazon frequently uses. This is because many companies choose it, thus they are able to buy the products in bulk and later customize it to suit the customers’ needs. The reduction of price mostly helps to make the company more attractive to  the customers .Other companies like Rackspace, Microsoft and Google also try to play the price reduction card  but  Amazon always tops them by coming up with new things that pose a great challenge to the competition. With this latest reduction, Amazon has made things worse for the other companies.

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