The future price of cloud storage is not a \u201crace to zero,\u201d as some predict. It is a race to the best price\/performance technically achievable. Just look at computer processors. They continue to get cheaper, but no one is giving them away for free inside laptops and smartphones. That\u2019s because they\u2019re also getting faster, enabling us to innovate and do more with them.\r\n\r\n\r\n\r\nThe same holds true for cloud storage. A provider may decide not to charge you for it, but you can guarantee you will be paying for it somewhere else, with additional services designed to lock you in.\r\n\r\nIn my mind, the race to zero is just so much marketing. In order for companies and organizations to turn data into meaningful and actionable insights, they will need to be able to afford to store more data longer, but also have significantly faster access to it. What the industry really needs is a race to \u201ccloud storage as a utility.\u201d\r\n\r\n \r\n\r\nA Utility, Just Like Electricity\r\n\r\nWhen you plug an electrical appliance into a power socket, you don\u2019t choose what quality of electricity you want. There\u2019s only one flavor of electricity, and the price is the price.\r\n\r\nWhen you buy storage from the current generation of cloud providers like AWS, Google Cloud Platform, or Azure, you must choose from a complex array of service tiers\u2014Standard, Reduced Redundancy, Infrequent Access, Nearline, Coldline, Glacier\u2014each with different pricing, speeds, and service levels. Pricing also changes based on region. Then there are all the additional fees (again different depending upon service tier) for API calls, such as GET, PUT, and DELETE.\r\n\r\nThese artificial tiers (I call them that because they all rely on the same underlying disk storage) force you to make tradeoffs between speed, reliability, and price. \u00a0These compromises are unacceptable in the era of big data analytics, automation, and agile decision making\u2014and will be made more obvious when the Internet of Things (IoT), with its commensurate explosion of data, takes off in earnest. For cloud storage to meet our needs today, and enable us to innovate in the future, these artificial tiers must give way to a standard, one-size-fits-all utility that is fast, reliable, and inexpensive.\r\n\r\n \r\n\r\nCommodity Pricing for Extreme Economies of Scale\r\n\r\nWhen I launched Wasabi with my friend and co-founder, Jeff Flowers, we specifically set out to design a new storage architecture that was significantly faster than Amazon Simple Storage Service (S3), but cheaper than Amazon Glacier. \u00a0This breakthrough in price\/performance allows us to eliminate all those complex service tiers. We offer one simple, highly reliable, lightning fast service called hot storage at commodity prices.\r\n\r\n\r\n\r\nGasoline is a classic example of a commodity product. Gas is gas. All regular gas is 87 octane, and any car can fill up at any service station. For cloud storage to become a utility-like commodity, it too must rely on standards and differentiate by price.\r\n\r\n \r\n\r\nStandardization is the Key to Mobility and Lower Prices\r\n\r\nWouldn\u2019t it be nice if you could move your storage from Amazon to Google or Microsoft without changing a single line of code?\u00a0 There isn\u2019t a standard API for cloud storage yet, though Amazon\u2019s S3 API is clearly at the head of the pack.\u00a0 That\u2019s why Wasabi is throwing its weight behind the S3 API.\u00a0 API standardization is key to driving down price because it eliminates vendor lock-in.\u00a0 Once storage is truly portable, vendors will not be able to get away with locking you into their proprietary storage.\r\n\r\nAs prices drop, the migration from on-premise to cloud storage will be more compelling.\u00a0 With cloud storage prices from Amazon, Google, and Microsoft in the $.02-.03\/GB per month range, there is no significant savings versus the total cost of ownership of on-premise storage. \u00a0Cut the cost of cloud storage to $.0039\/GB per month (Wasabi\u2019s hot storage pricing) and you\u2019re suddenly looking at savings of 75 percent or more compared to on-premise storage and current generation cloud storage.\r\n\r\nAt these commodity prices, new applications and business models become feasible. Media companies and law enforcement can now afford to save more video and bodycam files for longer periods of time. Developers wishing to create the next Instagram or Pinterest\u2014or any ad-supported free app that requires a lot of storage\u2014is suddenly viable and profitable.\r\n\r\n \r\n\r\nBut A Startup Can\u2019t Compete Against the Likes of Amazon\r\n\r\nCommon wisdom says that a startup in Boston should not be able to store data as cheaply as giants like Amazon.\u00a0 Yet history is replete with examples of innovation overcoming scale.\r\n\r\nFor nearly 100 years, US Steel was the largest steel company in the world.\u00a0\u00a0 Then in 1968, a little-known company called Nucor invented the highly efficient steel \u201cmini-mill,\u201d using a new technology called electric arc furnaces.\u00a0 Today, Nucor is the largest steel company in the U.S. And in May 2014, due to its declining market capitalization, US Steel was removed from the S&P 500.\r\n\r\n\r\n\r\nAm I suggesting that Wasabi\u2019s David will topple Amazon\u2019s Goliath? Of course not. Amazon eats entire industries for breakfast. Wasabi is only interested in revolutionizing cloud storage. It\u2019s all we do.\r\n\r\n \r\n\r\nWhere Will the Industry Be 10 Years from Now?\r\n\r\nMy bet is that cloud storage will become a utility.\u00a0 Almost every application needs storage. And with global data predicted to grow from 16 zettabytes in 2016 to 163 zettabytes in 2025, the world is going to need lots of it.\r\n\r\nNobody should be locked into proprietary vendor solutions.\u00a0 You should be able to unplug Wasabi and plug in any other vendor if that\u2019s what you want to do.\u00a0 This is our dream and our mission: to deliver standard cloud storage that is so cheap, so fast, and so reliable that it works for every storage need. Just like electricity.\r\n\r\nImages courtesy of Google images.