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What Google's Cloud Warmongering Means for Amazon Stock Investors

By Tim Beyers - Apr 22, 2013 at 7:43PM

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Now everyone wants a piece of the hosting business.

Suddenly, the tech world has gone jealous. Everyone wants to be Amazon.com (AMZN 0.19%).

Google (GOOGL -1.35%) offered the latest proof when it cut prices 4% on Cloud Engine, a low-cost hosting alternative to Amazon Web Services. EMC and VMware (VMW 1.41%) have also joined the effort with a spinoff called Pivotal, which is due to be formally unveiled before month-end, according to trade magazine eWEEK.

Even Microsoft (MSFT -0.37%) wants in, having recently cut prices for some on-demand services available through its competing Windows Azure platform. All signs point to a race to the bottom, which is good news for the likes of Netflix, which consumes vast amounts of Internet infrastructure for delivering its services. Amazon may not be so lucky, says Tim Beyers of Motley Fool Rule Breakers and Motley Fool Supernova in the following video.

What do you think of Google's power play? Please watch to get Tim's full take, and then leave a comment to let us know whether you'd buy, sell, or short Amazon stock at current prices.

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Stocks Mentioned

Alphabet Inc. Stock Quote
Alphabet Inc.
GOOGL
$2,207.68 (-1.35%) $-30.31
Amazon.com, Inc. Stock Quote
Amazon.com, Inc.
AMZN
$2,146.38 (0.19%) $4.13
Microsoft Corporation Stock Quote
Microsoft Corporation
MSFT
$253.14 (-0.37%) $0.94
Rackspace Hosting, Inc. Stock Quote
Rackspace Hosting, Inc.
RAX
VMware, Inc. Stock Quote
VMware, Inc.
VMW
$94.95 (1.41%) $1.32

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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