Google has announced a new cloud service Compute Engine, offering large-scale Linux virtualization on Google's infrastructure.

Google boasts that Compute Engine offers up to 50 percent more compute power per dollar than competing IaaS offerings. For applications with low bandwidth and I/O demands, Compute Engine can offer hundreds of thousands of cores; Google demonstrated a genetic application running on 600,000 cores. They also noted that the Institute for Systems Biology moved to Google Compute Engine after discovering their in-house cluster with 1,000 nodes still took 10 minutes to compute a single block of their data set. After spending a few days to move to Google's Compute Engine, they've seen significantly better performance.

The service is now in a limited beta.