Why we are not leaving the cloud • Hacker News Board

Re: Why we are not leaving the cloud

#51

Post by mcgoo » Thu, Mar 02, 2017, 7:38 PM UTC

tbrowbdidnso wrote: post #34

So everyone says the cloud is the future. I get it. But is this the truth, or what all the tech giants want people to believe? Don your foil hats for a moment and listen to me. All the original internet companies run their own hardware. They rent out excess production capacity to us peons in the form of cloud services. These companies that all run their own hardware exclusively are telling everyone that it's stupid t…

Netflix has edge caching deployed at "thousands of ISPs worldwide."

https://media.netflix.com/en/company-blog/how-netflix-works-...

Re: Why we are not leaving the cloud

#52

Post by deegles » Thu, Mar 02, 2017, 7:38 PM UTC

dsr_ wrote: post #40

tbrowbdidnso wrote: post #34

So everyone says the cloud is the future. I get it. But is this the truth, or what all the tech giants want people to believe? Don your foil hats for a moment and listen to me. All the original internet companies run their own hardware. They rent out excess production capacity to us peons in the form of cloud services. These companies that all run their own hardware exclusively are telling everyone that it's stupid t…

The cloud isn't a money-saving tactic. It enables you to test demand for a service for a very low absolute cost. Spin up a tiny machine for $60/year? And you can pay for it by the month, or the hour? That's great. You can find out if anybody is going to buy your thing at all. You can probably get to ramen-profitable. As soon as you can confidently predict sufficient demand, the economically rational decision is to hi…

> Hire a good ops team

I feel this is one of those "easier said than done" statements...

Re: Why we are not leaving the cloud

#53

Post by nnutter » Thu, Mar 02, 2017, 7:38 PM UTC

tbrowbdidnso wrote: post #42

closeparen wrote: post #38

Earlier quoted context omitted.

I don't think it's in doubt that it makes sense to own everything from the land to the silicon when you're the size of one of these "original internet companies." The question is, does it make sense for businesses with a handful of servers running their office environment, to a few thousand servers running production for a moderately popular web service, to pay consultants to drive out and tend the servers in their o…

Running on rented hardware is the equivalent of a traditional product company renting all of their factories. Almost any company of reasonable size will want vertical integration of their supply chain and web companies are no different. Using Netflix as an example again, if they're pitted against a company that runs their own hardware but is otherwise equal, they will lose. A portion of their profit is siphoned off a…

Does Apple own any factories?

Re: Why we are not leaving the cloud

#54

Post by praneshp » Thu, Mar 02, 2017, 7:39 PM UTC

mbesto wrote: post #50

tbrowbdidnso wrote: post #34

So everyone says the cloud is the future. I get it. But is this the truth, or what all the tech giants want people to believe? Don your foil hats for a moment and listen to me. All the original internet companies run their own hardware. They rent out excess production capacity to us peons in the form of cloud services. These companies that all run their own hardware exclusively are telling everyone that it's stupid t…

This is incredibly misguided. > The cloud as a money saving venture is and always has been a damn lie. I personally have conducted migration savings assessments for companies going from data centers (owned/lease hardware) to cloud services. I can tell you with 100% certainty that the savings are there and have seen financial proof of the savings. It's either that, or I'm a liar.

Hey, you are a liar. He is very sure that the cloud saving money has always been a damn lie! To hell with your data.

/s

Re: Why we are not leaving the cloud

#55

Post by clarkmoody » Thu, Mar 02, 2017, 7:39 PM UTC

tbrowbdidnso wrote: post #34

So everyone says the cloud is the future. I get it. But is this the truth, or what all the tech giants want people to believe? Don your foil hats for a moment and listen to me. All the original internet companies run their own hardware. They rent out excess production capacity to us peons in the form of cloud services. These companies that all run their own hardware exclusively are telling everyone that it's stupid t…

Don't forget to take the tinfoil off when you're done ;-)

What are some examples of companies that started in the cloud then switched to their own metal? Surely there are some blog posts about costs before & after?

Re: Why we are not leaving the cloud

#56

Post by tbrowbdidnso » Thu, Mar 02, 2017, 7:39 PM UTC

morgante wrote: post #49

dsr_ wrote: post #40

Earlier quoted context omitted.

The cloud isn't a money-saving tactic. It enables you to test demand for a service for a very low absolute cost. Spin up a tiny machine for $60/year? And you can pay for it by the month, or the hour? That's great. You can find out if anybody is going to buy your thing at all. You can probably get to ramen-profitable. As soon as you can confidently predict sufficient demand, the economically rational decision is to hi…

> and the costs of cloud service are zooming up, potentially leaving you without the margin to invest. What do you mean by this, because it sounds like a straight up lie? Amazon and Google are in an ongoing price war and cut costs regularly.

Possibly outgoing bandwidth. These costs are directly proportional to traffic and regularly 20-30x the unmetered rate for a colocated box

Re: Why we are not leaving the cloud

#57

Post by endisukaj » Thu, Mar 02, 2017, 7:42 PM UTC

tbrowbdidnso wrote: post #42

closeparen wrote: post #38

Earlier quoted context omitted.

I don't think it's in doubt that it makes sense to own everything from the land to the silicon when you're the size of one of these "original internet companies." The question is, does it make sense for businesses with a handful of servers running their office environment, to a few thousand servers running production for a moderately popular web service, to pay consultants to drive out and tend the servers in their o…

Running on rented hardware is the equivalent of a traditional product company renting all of their factories. Almost any company of reasonable size will want vertical integration of their supply chain and web companies are no different. Using Netflix as an example again, if they're pitted against a company that runs their own hardware but is otherwise equal, they will lose. A portion of their profit is siphoned off a…

If they used their own hardware a good portion of their profit would go to maintain that very same hardware. And because they would build that infrastructure from scratch it would cost even more to set up.

Re: Why we are not leaving the cloud

#58

Post by feyman_r » Thu, Mar 02, 2017, 7:42 PM UTC

tbrowbdidnso wrote: post #42

closeparen wrote: post #38

Earlier quoted context omitted.

I don't think it's in doubt that it makes sense to own everything from the land to the silicon when you're the size of one of these "original internet companies." The question is, does it make sense for businesses with a handful of servers running their office environment, to a few thousand servers running production for a moderately popular web service, to pay consultants to drive out and tend the servers in their o…

Running on rented hardware is the equivalent of a traditional product company renting all of their factories. Almost any company of reasonable size will want vertical integration of their supply chain and web companies are no different. Using Netflix as an example again, if they're pitted against a company that runs their own hardware but is otherwise equal, they will lose. A portion of their profit is siphoned off a…

I would think running on 'owned hardware' in rented colo space is very close to 'rented hardware' in the cloud.

The only clear differentiator then is actually owning a datacenter. And the Total Cost of Ownership of that isn't easy. For someone who doesn't want to be in the datacenter-ownership business, opting in to cloud would make sense. Concerns for privacy and government intervention are a valid concern though.

Re: Why we are not leaving the cloud

#59

Post by polishTar » Thu, Mar 02, 2017, 7:43 PM UTC

dsr_ wrote: post #40

tbrowbdidnso wrote: post #34

So everyone says the cloud is the future. I get it. But is this the truth, or what all the tech giants want people to believe? Don your foil hats for a moment and listen to me. All the original internet companies run their own hardware. They rent out excess production capacity to us peons in the form of cloud services. These companies that all run their own hardware exclusively are telling everyone that it's stupid t…

The cloud isn't a money-saving tactic. It enables you to test demand for a service for a very low absolute cost. Spin up a tiny machine for $60/year? And you can pay for it by the month, or the hour? That's great. You can find out if anybody is going to buy your thing at all. You can probably get to ramen-profitable. As soon as you can confidently predict sufficient demand, the economically rational decision is to hi…

I'd also argue that "sufficient demand" is a threshold that's been rising very fast over the last couple of years and likely to continue doing so.

This also explains why older tech companies disproportionately use their own hardware, even those that aren't all that big. They all made that decision at a time when it made sense and the switching cost is sufficiently high to prevent them from turning back now.

I doubt there are many rational cases now for newer companies to use anything but the cloud. Even at the scale of Snapchat (>3B$ infrastructure spend over next 5 years) and Netflix, it appears the public cloud is still the rational choice.

Re: Why we are not leaving the cloud

#60

Post by scott_s » Thu, Mar 02, 2017, 7:43 PM UTC

tbrowbdidnso wrote: post #34

So everyone says the cloud is the future. I get it. But is this the truth, or what all the tech giants want people to believe? Don your foil hats for a moment and listen to me. All the original internet companies run their own hardware. They rent out excess production capacity to us peons in the form of cloud services. These companies that all run their own hardware exclusively are telling everyone that it's stupid t…

The actual streaming video from Netflix does not come from Amazon's systems. From https://arstechnica.com/information-technology/2016/02/netfl...,

"Netflix operates its own content delivery network (CDN) called Open Connect. Netflix manages Open Connect from Amazon, but the storage boxes holding videos that stream to your house or mobile device are all located in data centers within Internet service providers' networks or at Internet exchange points, facilities where major network operators exchange traffic. Netflix distributes traffic directly to Comcast, Verizon, AT&T, and other big network operators at these exchange points."

Everything else - such as the Netflix UI, your account management, billing, etc - is on Amazon. But Netflix has an enormous amount of hardware distributed around the world. If you wanted to compete with Netflix, you would need to do a lot more than uses Amazon's cloud services.