Scaling down - the least talked about feature of GAE

It launched less than a week ago and now all over the blogosphere people are discussing the Google App Engine (GAE). Most talk is about scaling up, about potential lock-ins, even if the SDK is based on open source software. Only one thing where developers seem generally to agree: with Python, Google has made a good choice (maybe those not knowing Python yet but desperately looking forward to learn it, don't know that Python dictates line indention, actually the only thing I had difficulty to get used to). That is interesting by itself, because developers usually are highly opinionated in regard to programming languages. Or is it just the early adapter mentality which is more flexible ? Anyway - in this article I want to talk about something I haven't found mentioned yet at 100 other places:

scaling down

I see a growing number of businesses reducing or eliminating their IT department by using Google Apps (gmail & Co. on custom domain) for e-mail and other standard tasks covered by the Google Apps suite. Custom built applications for streamlining their non-standard, probably also simple but business specific work-flow has been beyond the budget of small organizations. So they used the available standard tools, which are often more complex than necessary for those tasks. But now the creation and especially the maintenance of custom built web applications is getting cheaper with GAE, because problems like authentication, deployment, high availability and even data redundancy (as probably-good-enough backup-strategy) are solved already and the cost for hosting gets completely eliminated (scaling down means just few concurrent users per application, little resource usage and the app will probably stay within the quotas for free usage of GAE). So the saved money from traditional in-house or outsourced IT administration, spent on development of custom applications will allow organization to improve their efficiency. And Google of course still will make good money with this scenario, because some companies will choose Google Apps Premier Edition over free/limited edition and will pay Google 50 $ per user account / per year.