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Ask HN: Cloudflare R2 seems too good to be true. Do the economics make sense?

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Ask HN: Cloudflare R2 seems too good to be true. Do the economics make sense?

#1
It's hard to believe CloudFlare R2 charges zero egress compared to 9 cents per gigabyte from all the big cloud providers.

How can it make economic sense for CloudFlare?

Will this last? Will it be cancelled?

I feel like I'm stealing when I use it, I'm so used to being charged 9 cents per GB.

Re: Ask HN: Cloudflare R2 seems too good to be true. Do the economics make sense?

#3
post #2

9¢/GB is theft, honestly.

I’m not sure if R2 is sustainable but AWS’s egress rates are outrageous. The flip side though is that high egress rates make quite a few problems, like customers using the service to distribute pirate copies of media, go away.

Re: Ask HN: Cloudflare R2 seems too good to be true. Do the economics make sense?

#4
Keep in mind that when Amazon and other hosting companies buy bandwidth, it is symmetric: they don't pay a smaller rate for ingress than egress. Charging a lot for egress is just a way (IMO) to keep customers stuck on their platform, because migrating data to another provider is expensive.

Re: Ask HN: Cloudflare R2 seems too good to be true. Do the economics make sense?

#5
post #2

9¢/GB is theft, honestly.

I’m not sure if R2 is sustainable but AWS’s egress rates are outrageous. The flip side though is that high egress rates make quite a few problems, like customers using the service to distribute pirate copies of media, go away.

Oddly, Cloudflare is part of the Bandwidth Alliance - a consortium of 19 companies who want to reduce bandwidth costs.

Backblaze, an online storage and backup company, is also a member. They charge $.005/GB/month for S3 compatible storage. And if you map and access a bucket through Cloudflare there is no egress fee.

So it's possible to store and access your files at 1/3 the price of Cloudflare alone by using Cloudflare (plus Backblaze).

Re: Ask HN: Cloudflare R2 seems too good to be true. Do the economics make sense?

#6
post #5

Earlier quoted context omitted.

I’m not sure if R2 is sustainable but AWS’s egress rates are outrageous. The flip side though is that high egress rates make quite a few problems, like customers using the service to distribute pirate copies of media, go away.

Oddly, Cloudflare is part of the Bandwidth Alliance - a consortium of 19 companies who want to reduce bandwidth costs. Backblaze, an online storage and backup company, is also a member. They charge $.005/GB/month for S3 compatible storage. And if you map and access a bucket through Cloudflare there is no egress fee. So it's possible to store and access your files at 1/3 the price of Cloudflare alone by using Cloudfla…

The bandwidth alliance only applies to serving web content. Backblaze and R2 are not exactly aimed at the same market

Re: Ask HN: Cloudflare R2 seems too good to be true. Do the economics make sense?

#7
You should read this to understand how the economics of this works: https://stratechery.com/2021/cloudflares-disruption/

"The reason that Cloudflare can pull this off is the same reason why S3’s margins are so extraordinary: bandwidth is a fixed cost, not a marginal one. To take the most simplified example possible, if I were to have two computers connected by a cable, the cost of bandwidth is however much I paid for the cable; once connected I can transmit as much data as I would like for free — in either direction.

That’s not quite right, of course: I am constrained by the capacity of the cable; to support more data transfer I would have to install a higher capacity cable, or more of them. What, though, if I already had built a worldwide network of cables for my initial core business of protecting websites from distributed denial-of-service attacks and offering a content delivery network, the value of which was such that ISPs everywhere gave me space in their facilities to place my servers? Well, then I would have massive amounts of bandwidth already in place, the use of which has zero marginal costs, and oh-by-the-way locations close to end users to stick a whole bunch of hard drives."