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Bank of America's CEO says it's saved $2B per year by building its own cloud

businessinsider.com

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Re: Bank of America's CEO says it's saved $2B per year by building its own cloud

#11

Post by [deleted] »

thorwasdfasdf wrote: post #7
toomuchtodo wrote: post #4

Earlier quoted context omitted.

And it's still cheaper than public cloud. Look at cloud provider margins, that profit is your opportunity at this scale (and BoA, JPM, etc are big enough to run their own technology teams, and do, having worked with them). Fat public cloud margins come from somewhere. This isn't a religious argument. Some workloads are fine on prem (known load profiles, shed infrequent traffic spikes instead of bursting), some need c…

but why aren't those fat profit margins being competed away by competitors?

[deleted]

Re: Bank of America's CEO says it's saved $2B per year by building its own cloud

#12

Post by nartz »

This is completely false - I imagine they didn't take into account how much the migration and upkeep actually cost them. AWS's promise is not that its infrastructure itself is cheaper in terms of number of servers, or otherwise. Its cheaper in that it helps automate a lot of manual things away.

Re: Bank of America's CEO says it's saved $2B per year by building its own cloud

#13

Post by rapsey »

thorwasdfasdf wrote: post #7
toomuchtodo wrote: post #4

Earlier quoted context omitted.

And it's still cheaper than public cloud. Look at cloud provider margins, that profit is your opportunity at this scale (and BoA, JPM, etc are big enough to run their own technology teams, and do, having worked with them). Fat public cloud margins come from somewhere. This isn't a religious argument. Some workloads are fine on prem (known load profiles, shed infrequent traffic spikes instead of bursting), some need c…

but why aren't those fat profit margins being competed away by competitors?

There aren’t that many competitors and they like profit as well.

Re: Bank of America's CEO says it's saved $2B per year by building its own cloud

#14

Post by Someone1234 »

I think a strong argument can be made either way.

There's definitely financial savings to be had by doing it in-house (either literally or utilizing existing data centers as here). But what I've experienced is that companies are often attracted to Big Cloud™ not just for financial reasons but to flatten/simplify their corporate reporting structure. It is the ultimate delegation.

This isn't simply about having fewer staff (although that can reduce internal politics and inefficiencies), but making fewer decisions and more importantly reducing the potential for making the wrong decisions (which can be career-costly, regardless of right decisions made previously).

These "soft" costs/savings are rarely discussed because they cannot be measured, unlike a balance sheet. But there's definitely a whole other dimension to infrastructure outsourcing that is worthy of note.

In this case BoA are saving money but in exchange retain additional layers of staffing, that require oversight, and ultimately decision makers willing to take risks.

Re: Bank of America's CEO says it's saved $2B per year by building its own cloud

#15

Post by Finnucane »

thorwasdfasdf wrote: post #7
toomuchtodo wrote: post #4

Earlier quoted context omitted.

And it's still cheaper than public cloud. Look at cloud provider margins, that profit is your opportunity at this scale (and BoA, JPM, etc are big enough to run their own technology teams, and do, having worked with them). Fat public cloud margins come from somewhere. This isn't a religious argument. Some workloads are fine on prem (known load profiles, shed infrequent traffic spikes instead of bursting), some need c…

but why aren't those fat profit margins being competed away by competitors?

Who has the resources and interest to compete in that market who isn't trying to already?

Re: Bank of America's CEO says it's saved $2B per year by building its own cloud

#17

Post by Retric »

nartz wrote: post #12

This is completely false - I imagine they didn't take into account how much the migration and upkeep actually cost them. AWS's promise is not that its infrastructure itself is cheaper in terms of number of servers, or otherwise. Its cheaper in that it helps automate a lot of manual things away.

2 Billion per year buys a lot of R&D. So, while Amazon is great for small to mid sized companies, BoA is huge and would need massive discounts to consider using Amazon.

Re: Bank of America's CEO says it's saved $2B per year by building its own cloud

#18

Post by api »

sairahul82 wrote: post #5

If you know your traffic well, private cloud saves a lot of money. Few years back i bet hybrid clouds will take over and for some reason it did not happen. I still believe hybrid cloud is the solution for mid size and up companies. You definitely need cloud provides for handling traffic spikes.

Nobody ever got fired for using AWS.

Re: Bank of America's CEO says it's saved $2B per year by building its own cloud

#19

Post by api »

nartz wrote: post #12

This is completely false - I imagine they didn't take into account how much the migration and upkeep actually cost them. AWS's promise is not that its infrastructure itself is cheaper in terms of number of servers, or otherwise. Its cheaper in that it helps automate a lot of manual things away.

If you manage things right its not that hard. Unfortunately there are not all that many good devops people. Expect to pay them as much as higher end devs. But overall you can save a ton of money hiring some of those and passing on the outrageous AWS markup on CPU and bandwidth.

Re: Bank of America's CEO says it's saved $2B per year by building its own cloud

#20

Post by mywittyname »

Someone1234 wrote: post #14

I think a strong argument can be made either way. There's definitely financial savings to be had by doing it in-house (either literally or utilizing existing data centers as here). But what I've experienced is that companies are often attracted to Big Cloud™ not just for financial reasons but to flatten/simplify their corporate reporting structure. It is the ultimate delegation. This isn't simply about having fewer s…

Also reducing friction in getting products to market. A small team with their own BigCloud account is probably going to deliver a product to market much faster than one that needs to go through the friction of dealing with the various IT departments which invariably exist at large companies.

There is absolutely value to delivering a product to market a year or more sooner than otherwise.

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