Establishing a long-term dependency on "Scaling R Us" was the problem, not Amazon. If you diversify AWS with GCE so that you have established choices, that's cool -- but "Scaling R Us" is still a problem.
Switching Costs in Software Development
31–40 of 45 posts
Re: Switching Costs in Software Development
#32Amazon has a great service, but when I experiment with things on AWS the cost always seems to end up at $30-$100 to run the experiment on AWS where when I use Google they typically send me a bill for $1.48 or more recently I got a $0.24 bill. It always seems more expensive to even kick the tires on something with AWS versus GCP. Having said that the company I work for now was spending so much on AWS they had to do so…
You could pay for the care and feeding of five developers for that kind of money (including taxes, infrastructure and support costs). Maybe something to consider in future build vs buy decisions.
Re: Switching Costs in Software Development
#33I wish more web services provided opensource versions (Service-as-a-Software). Large orgs would still pay for service contracts even if they self host, and just having the option makes everyone more likely to invest on top of your service.
Re: Switching Costs in Software Development
#34I always wonder why people think the only 'fair' pricing is pricing based on costs. This is not how free markets work.
You are right that pricing on costs is not how it should work. A better pricing would be based on the value created. In this case however the value created correlates to the man hours saved (vs. e.g. managing instances manually without the tool). And since manually managing a large instance is not more work than managing a smaller one, there is no additional value created, so the pricing logic is unreasonable.
On the other side of the spectrum, "value added" can be used as an excuse to charge more money to wealtier customers. Using the same example above, Microsoft should not be able to charge a million dollars for an Excell license that is used by financial wizards to make billion-dollar decisions. The potential is there in the tool, but most of the value added comes from the expertise of the user.
Re: Switching Costs in Software Development
#35Amazon has a great service, but when I experiment with things on AWS the cost always seems to end up at $30-$100 to run the experiment on AWS where when I use Google they typically send me a bill for $1.48 or more recently I got a $0.24 bill. It always seems more expensive to even kick the tires on something with AWS versus GCP. Having said that the company I work for now was spending so much on AWS they had to do so…
Re: Switching Costs in Software Development
#36I wish more web services provided opensource versions (Service-as-a-Software). Large orgs would still pay for service contracts even if they self host, and just having the option makes everyone more likely to invest on top of your service.
Re: Switching Costs in Software Development
#37Amazon has a great service, but when I experiment with things on AWS the cost always seems to end up at $30-$100 to run the experiment on AWS where when I use Google they typically send me a bill for $1.48 or more recently I got a $0.24 bill. It always seems more expensive to even kick the tires on something with AWS versus GCP. Having said that the company I work for now was spending so much on AWS they had to do so…
If you have an MSDN license through your employer, Azure offers $50-150/mo credits depending on license types for dev and test environments. I've never run into issues getting feedback on prototypes in test from real customers, nor have I ever broken through that credit on a single app. Occasionally I'd pass $150 if we were running 3-5 apps simultaneously all with some measurable load but often the "usage" was in the…
Re: Switching Costs in Software Development
#38A financial company I used to work for had a legacy software product used by banks, that the banks themselves had estimated would cost something on the order of $50 million to replace. The product licensing fees reflected that fact and it was basically a cash cow for the company.
Re: Switching Costs in Software Development
#39> With all the important things being equal, I choose the service with the much smaller market share and encourage others to do so as well. The problem with this is it increases your risk that the company will simply go out of business, which could be even worse than raising prices 10x as in the example. I think it can also raise risk that the company will significantly change it's pricing model too, they don't want…
This. I'm struggling to remember the right game theory term here, but there's a mismatch between what you want for yourself and what you want others to do. It's great if other people to pick the service with the smaller market share, thereby increasing competition, but you yourself probably want to stick with the larger service because of the various network effects associated with being part of the larger service (e…
Re: Switching Costs in Software Development
#40I always wonder why people think the only 'fair' pricing is pricing based on costs. This is not how free markets work.
>> I always wonder why people think the only 'fair' pricing is pricing based on costs. This is not how free markets work. In a real free market that is how it should turn out. If someone is charging too high above cost, a competitor will likely step in to grab market share by offering the same thing at a lower cost. Companies go to great lengths to make the playing field uneven - "unfair" practices, unfair employment…