Google Cloud launched Flex Agreements today, a bold move that allows customers to migrate their workloads to the cloud with no up-front commitments. As part of Google’s new licensing option, customers still get access to Google Cloud incentives such as cloud credits and monthly spending discounts. This really opens up a new chapter in what is now a very much consumption-driven world, both for Google Cloud and also for customers and for partners,” said Tony Safoian, CEO of SADA, one of Google Cloud’s top partners in the U.S. “It really lowers the barrier of entry in terms of giving the best of Google Cloud without a big upfront financial constructor.”
Safoian said customers previously needed an upfront commitment—such as signing a large multi-year Google Cloud commitment—in order to reap the benefits of a certain set of incentives like cloud credits or discounts based on monthly spending or committed use. For example, Google’s Committed Use Discounts (CUDs) provide discounted prices in exchange for a commitment to use a minimum level of cloud resources for a specified term.
“Customers knew that in exchange for a multiyear financial commitment, they could receive certain benefits that could improve the economics of their cloud investment, that could lower their risk profile of making the move, etc.,” Safoian said. “But the most important thing is getting a customer started. Why hold back those incentives at a point when customers are ready to dive into this new platform and win this new journey with us?”
Providing these incentives without a commitment will give us more than an ample opportunity to prove the value of Google Cloud and our services over time,” SADA’s CEO said. “They’re giving customers what they want: more choice, more flexibility.”
“This new commercial packaging model will give customers more choice and flexibility to optimize their cloud spend,” Kelly Ducourty, vice president of go-to-market strategy and operations, and Joe Matz, vice president of business planning and pricing, wrote in a blog post today. These new product pricing editions will be available in the coming quarters. The Enterprise Plus tier will offer high availability, multi-region support, regional failover and disaster recovery, advanced security, and regulatory compliance support for computing, storage, networking, and analytics services.
Google Cloud’s new Enterprise pricing tier will include a broad range of features designed for customers with workloads that demand a high level of scalability, flexibility, and reliability. The Standard pricing tier will offer cost-efficient and easy-to-use managed services that include all essential capabilities such as autoscaling to meet the core workload requirements of customers.
‘Removing Entry Barriers’
Some businesses find it difficult to predict how many cloud computing resources they will require in the coming months or years, which is why flex agreements were developed. Each organization is on its own cloud journey. We’re working on new ways for customers to consume and pay for Google Cloud services to help. “We’re doing this by lowering entry barriers, aligning cost to consumption, and rewarding longer-term commitments,” said Ducourty and Matz of Google Cloud. The new pricing tiers and Flex Agreements can assist Google partners in assisting their customers during the upcoming uncertain economy in 2023.
During “these strange macroeconomic times,” said SADA CEO Safoian, customers want more spending flexibility and cloud choice. Every customer is under increased pressure, whether from investors or their board, to save where they can without significant upfront financial commitments if possible. “The new Flex Agreements’ structure allows it,” he says. “Then, on top of that, these different tiers and pricing provide an additional layer of flexibility, which is fantastic.” Customers using Google Cloud can now choose between more expensive options, such as Enterprise Plus if their mission-critical needs meet those requirements, or they can save money by using the Standard edition offering, which is more appropriate for their workloads. “ Google is entering the market.
