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» VIEW ALL POSTS Dec 12 2012   7:24PM GMT

HP Cloud Compute undercuts Amazon, too



Posted by: Beth Pariseau
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It turns out that a headline I wrote for SearchCloudComputing.com last week about the new HP Cloud Compute service was only half right.

The headline calls out that HP has undercut Rackspace with its per-hour pricing of 4 cents (Rackspace’s on-demand offering is priced at 6 cents per hour). But as pointed out today by @ stackgeek on Twitter, that headline, as well as these paragraphs in the story:

Prices for Hewlett-Packard’s (HP) Cloud Compute service start at four cents per hour for a small instance with 1 GB of RAM – 2 cents lower than the price for Rackspace’s 1 GB instance. Amazon Web Services’ (AWS) Reserved Small Instance, which comes with 1.7 GB of memory, costs 3.9 cents per hour.

 While AWS still offers the best deal, HP’s pricing for the fledgling service might attract Rackspace customers.

…are not totally accurate.

I re-checked the Amazon pricing page, and @stackgeek is correct in pointing out the $69 one-time upfront cost for a small, lightly utilized one-year Reserved Instance. While the 3.9-cent hourly cost without this fee would make Amazon cheapest on a yearly basis, at $341.64, the fee makes Amazon’s cost per year $410.64. HP’s cost per year at 4 cents an hour is $350.40 and Rackspace’s price per year at 6 cents an hour is $525.60.

@stackgeek is also correct in pointing out that the original comparison was between Amazon’s Reserved Instance and HP and Rackspace’s on-demand instances. The pricing for an On-Demand Instance on Amazon is 6.5 cents per hour, which is half a cent more expensive than Rackspace. That makes the pricing for an Amazon On-Demand instance $47.45 a month, or $569.40 per year.

So, HP’s new service actually undercuts both Rackspace and Amazon on price. And Amazon Web Services is more expensive than Rackspace’s Cloud Servers as well.

I regret the errors.

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