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Snap commits $2B over 5 years for Google Cloud infrastructure

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Re: Snap commits $2B over 5 years for Google Cloud infrastructure

#221

Post by jessaustin »

Gigablah wrote: post #66
jessaustin wrote: post #53

Earlier quoted context omitted.

Will "Google Cloud Platform" exist in 5 years?

Will America exist in 5 years? (See how obnoxious this sounds?)

One supposes that might seem "obnoxious", to those who were somehow psychologically committed to what... the perpetual existence of America? That ain't me. It seems unlikely that the continent will sink into the ocean anytime in the next five years, however.

Perhaps I could have been clearer, but I didn't say that Alphabet would fail anytime soon anyway. I referred rather to G's habit of discontinuing popular services.

Re: Snap commits $2B over 5 years for Google Cloud infrastructure

#222

Post by origami777 »

forgetsusername wrote: post #211
origami777 wrote: post #151

Earlier quoted context omitted.

Bingo. They aren't paying advertised rates. Google will have margin but not as much as usual. Snap also has google by the balls here. What if snap comes out with a statement saying Gcp sucks and they're moving to aws?

> Snap also has google by the balls here. Surely they don't. > What if snap comes out with a statement saying Gcp sucks and they're moving to aws? Then we question why Snap committed billions of dollars to infrastructure that "sucks", and wonder why they couldn't figure it out, but Google could. You think people will take Snap more seriously than Google itself?

Yes, I do think Google's biggest customer leaving their platform vocally would be more impactful than Google promoting/defending itself.

If Snap threatened to leave I'd wager that even the CEO of Google would get involved to keep their biggest cloud customer. Snap's revenue and brand name have enormous value to Google. There simply aren't that many $2 billion dollar cloud customers right now.

Re: Snap commits $2B over 5 years for Google Cloud infrastructure

#223

Post by hnarayanan »

filereaper wrote: post #20

I'm confused by this high cost, sure you might need lots of compute, but storage tends to dominate over the long term. Isn't Snapchat supposed to delete data after 30s or whatever? Why this insanely high cost? Can somebody shed some light.

I suppose you're confusing the user-facing feature with what actually happens on their servers.

Re: Snap commits $2B over 5 years for Google Cloud infrastructure

#224

Post by charlesdm »

chrissnell wrote: post #138
late2part wrote: post #126

Earlier quoted context omitted.

That random person is right. One can run a DC at scale of 50 racks at least 20% cheaper than GCP. That's $80M a year to hire 20 smart people at $2M a year and 200 reasonably smart people at $200k per year. Snap will vanish like their pictures.

I think you're very conservative on that estimate. We run an infrastructure on dedicated leased hardware (Rackspace). Our infrastructure costs are a fraction of what the equivalent public cloud footprint costs. With technologies like Kubernetes and CoreOS, our private cloud practically runs itself. We focus on apps and the developer pipeline, much like we would do if we were on GCP/GKE. We have approximately 60 dedic…

For a company that has always been handed (basically free) money at obscene valuations, why would you assume they care about two billion? Maybe it's just as simple as that?

It's an excellent argument as to why I will not be purchasing this stock.

Re: Snap commits $2B over 5 years for Google Cloud infrastructure

#225

Post by bostand »

andybak wrote: post #215
vincnetas wrote: post #204

Earlier quoted context omitted.

Or a dog running infrastructure on FB ;)

That's unfair. From what I can tell all the canines are on the mobile app development team.

The android app team consist probably mostly of whales.

(observation based on the fluidity of their app)

Re: Snap commits $2B over 5 years for Google Cloud infrastructure

#226

Post by orbifold »

robjan wrote: post #200
conanbatt wrote: post #59

Earlier quoted context omitted.

If facebook loses users to snapchat in a massive way, it could happen. Otherwise they wouldnt have tried to buy snapchat.

Facebook copied snapchat with some of the new features in Instagram. Most of the people I know migrated from Snapchat to Insta when that happened.

My understanding is that Snapchat is cool among teenagers and tweens, whereas Facebook is old news. I've watched people "use" Facebook and it seems to provide negative value. If you are interested in diverse things your feed will be a total freak show, images of deformed penises (Medizine groups have those) mixed with 5 step cooking gifs. Snapchat seems to have a much better focus on stuff people actual want to do, whereas the core Facebook experience seems to be just aweful and outdated.

Re: Snap commits $2B over 5 years for Google Cloud infrastructure

#227

Post by Klathmon »

late2part wrote: post #129
nikcub wrote: post #61

Earlier quoted context omitted.

There is nothing about using cloud services that makes this a unique risk factor. With self-hosting replace "Google" with the companies own name and list all the things that can go wrong - it's pretty standard for a tech co. S1. For ex. this is Twitter's risk item for running hosted services: > Our business and operating results may be harmed by a disruption in our service, or by our failure to timely and effectively…

So outsource the risk so you can blame someone else? Maybe....

Outsource the risk to someone who has an entire product devoted to that one area, and has many years of experience and is probably the largest provider on the planet for that service...

Re: Snap commits $2B over 5 years for Google Cloud infrastructure

#228

Post by vonklaus »

randartie wrote: post #50

Needing this amount of resources implies that Snap is expecting huge growth. This sounds like a really bad move on their part and they should have committed to building out their own infrastructure on 'bare metal' over the next 5 years instead. If you read their S-1, they list a dependence on Google cloud as one of their big risk factors. Yet they then go ahead and make this commitment instead of working towards elim…

Counterpoint: Maybe the agreement is breakable or they know they can resell the resources. This metric could be a good way to trick "tech savvy" analysts who don't care about total users.

I assume spending this much would give them a below market discount and they could recoup some of their losses if nec.

All this assumes it is a positioning tactic w/ a hedge. Maybe, they will just build a developer ecosystem a don't want to bifurcate their engineering output. If twitter fails, it would validate this choice as they can pay a slight premium and if their metrics increase build infrastructure in 2.5 years w/ more info to spec it

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