They're looking at the long term. What they announced today isn't going to make or break the business. They can always lower prices but undercutting and realizi

They're looking at the long term. What they announced today isn't going to make or break the business. They can always lower prices but undercutting and realizing later that they need to raise them to maintain the business model is not something they are going to flirt with again. I don't think they expect people to migrate in waves but I think there will be a time when "we know AWS" isn't a sound argument. There are plenty of projects to come that can evaluate both on their own merits. It's what each does from today that will answer those questions. Also, GAE no doubt will play a role. I'm interested to see what comes of Cloud Endpoints (REST APIs) and other integration we can get between the two. I think this opens up some very interesting possibilities but I won't get into that. And let's not forget that not everyone is thrilled with AWS. It's a great service but it has flaws. Google can afford to make a long-term effort to build a solid product that goes head-to-head with AWS.