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DigitalOcean is laying off staff

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Re: DigitalOcean is laying off staff

#131

Post by zymhan »

walrus01 wrote: post #89
Meekro wrote: post #54

Digital Ocean is a great company in a brutal, low-margin industry. Based on having run a similar (now mostly defunct) company in the past, I would guess that 80% of their customers are on the $5/mo plan. That $5/mo has to cover the hardware costs: you're buying expensive physical servers to put the VPSes on, and lots of SSDs too. SSDs have a limited lifetime measured in writes, and some of your customers will leave b…

Person whose job title has "senior network engineer" in it here. I work for a mid sized regional ASN doing middle-mile and last-mile transport and transit. Quite intentionally we offer no services to customers related to VM hosting or managed hosting. The closest we come is selling rack space/cooling/power to people who want to colocate their own equipment and be fully responsible for it themselves. We are considerab…

> Extensive well crafted automation tools and massive economies of scale are the only thing that will save you.

Ironically, this same strategy is what makes cloud providers more interchangeable to their users, and drives down prices.

Re: DigitalOcean is laying off staff

#132

Post by jgalentine007 »

gramakri wrote: post #94
PeterZaitsev wrote: post #57

Interesting story of Hyper-funded DigitalOcean vs Bootstrapped Linode

Wow, didn't realize linode is bootstrapped. How did they manage to build so many cloud centers with no investment? Do you know more of their story?

Profit margins back in the day were a lot better than they are now. I started a web hosting company back in 99' as a high school senior with a couple hundred dollars, bootstrapped it to half a million in a couple years, and then over a million by year 10 (and sold it!) At that point margins had gotten skimpy and AWS with all their backing was eating up the market.

Re: DigitalOcean is laying off staff

#133

Post by lozaning »

biztos wrote: post #96
Meekro wrote: post #54

Digital Ocean is a great company in a brutal, low-margin industry. Based on having run a similar (now mostly defunct) company in the past, I would guess that 80% of their customers are on the $5/mo plan. That $5/mo has to cover the hardware costs: you're buying expensive physical servers to put the VPSes on, and lots of SSDs too. SSDs have a limited lifetime measured in writes, and some of your customers will leave b…

I've had a "droplet" going at $7/mo for about half a year and probably used it less than ten hours so far, and not doing anything too heavy when I use it. Every time I think about turning it off I say "yeah but it's only $7 and I like to ssh into it sometimes." I've had a "shared hosting" setup on Dreamhost for at least 15 years, also using pennies per month in capacity, at most. I get that it can be a brutal, low-ma…

One of the interesting metrics from my time working in global escalations for one of the worlds largest electronics manufacturers is that most customers don't call in for support, but on average we get 3.5 calls per user per account lifetime.

The 80/20 rule in in full effect here. The 'needy' customers are extremely resource intensive.

Re: DigitalOcean is laying off staff

#134

Post by ses1984 »

jldugger wrote: post #82
Meekro wrote: post #54

Digital Ocean is a great company in a brutal, low-margin industry. Based on having run a similar (now mostly defunct) company in the past, I would guess that 80% of their customers are on the $5/mo plan. That $5/mo has to cover the hardware costs: you're buying expensive physical servers to put the VPSes on, and lots of SSDs too. SSDs have a limited lifetime measured in writes, and some of your customers will leave b…

> Based on having run a similar (now mostly defunct) company in the past, I would guess that 80% of their customers are on the $5/mo plan. I wonder if the Always Free tiers of GCP / OCI have helped DO in this regard. You can get a lot of free VMs these days, so maybe other cheapasses like myself have left the DO / Linode / etc platforms.

I personally have canceled a linode instance and replaced it with GCP free tier vm about a year ago.

I feel like GCP/AWS free tier have probably hurt the $5/mo hosting business a lot.

Re: DigitalOcean is laying off staff

#135

Post by samsepi0l »

tempsy wrote: post #118
samsepi0l wrote: post #112

Earlier quoted context omitted.

This is actually huge. Especially in a startup or other small business. Misconfiguring something in AWS (or just simply not understanding their contrived billing models) can get unpredictably expensive.

what about Linode?

They are great too, I see them on par with DO

Re: DigitalOcean is laying off staff

#136

Post by daxorid »

timfrietas wrote: post #30
djsumdog wrote: post #14

Earlier quoted context omitted.

Digital Ocean is pretty similar to Vultr: they offer a straight easy API for starting up VMs and managing DNS (I've written a tool that uses both of their API[1]; been meaning to do a post on the differences). It's kinda nice because you're just putting up VMs and there's not the type of vendor lockin you get with AWS/Azure/Google. That being said, DO is obviously trying to compete on that scale now. It has managed d…

You mean Vultr is pretty similar to DO :) When I worked at DigitalOcean all we could do was shake our head and laugh at how blatantly hard Vultr tried to copy what we did.

Yes, but one thing Vultr didn't copy from DO is their disgusting and virulent anti-free speech position. The result is a superior product.

Today, Vultr offers similar service, at a lower price point, without the risk that your entire account will be suspended for thinking unapproved thoughts. This is a pretty good selling point to anyone who isn't an apparatchik of modern political and social dogma.

Re: DigitalOcean is laying off staff

#137

Post by samstave »

Townley wrote: post #55

I'm rooting for them as one of the best potential guardians against the cloud provider market becoming even more of an oligopoly. Cloud resources should be a commodity. Providers should offer compute resources, persistent storage, load balancers, and MAYBE a small handful of other services. The way Digital Ocean succeeds against AWS is by aligning itself with this idea, and competing on specialization. Forget competi…

>...against the cloud provider market becoming even more of an oligopoly.

I'd be interested in the more opaque aspects of all cloud hosting i.e. Unfettered, and or, at least, Invisible government(s) access -- however there is a really dark double-edge on that privacy hope. (specifically, that there is a lot of nefarious dealings on dark web systems which humanity would be better without)

Its almost as though we also need the antithesis to the dark web. Whereby, if we were to consider the contemporary Internet as the 'Gray Web', the ostensibly-perceived-as-criminal 'Dark Web' the host of Nefarious Dealings, and a 'White Web' for things on the transparent, or at-least validated on the up-and-up.

I would propose that ALL sites with content directed at children must be regulated on the 'White Web' (looking at you, YouTube >:-[

Anyway - my overall point is that Cloud has become 'Privacy-out-of-sight-out-of-mind Land'...

Re: DigitalOcean is laying off staff

#138

Post by jdormit »

esaym wrote: post #66

Weird, when I go to the link, the page immediately redirects to https://guce.advertising.com/collectIdentifiers?sessionId=1.... . Even if I try to just go to techcrunch.com/, same thing. I only notice this because *advertising.com is in my host file on my router so instead of redirecting, I just get a "server not found" error page in firefox. If I open a private tab, techcrunch.com loads fine. Looking at the network…

Yup, I can confirm. techcrunch.com redirects to guce.techcrunch.com, which redirects to guce.advertisting.com, which then redirects back to techcrunch.com. This only happens on the first page load (presumably due to cookies being set for the guce.techcrunch.com domain).

The redirects are really fast, seems like the only reason @esaym noticed is that they are blocking advertising.com via their hosts file which prevents the final redirect back to techcrunch.com.

Welcome to surveillance capitalism...

Re: DigitalOcean is laying off staff

#139

Post by ogre_codes »

peteradio wrote: post #48
ogre_codes wrote: post #32

Earlier quoted context omitted.

It could easily be both a re-org and dressing the profitability numbers prepping for a sale. The fact that its mostly management is encouraging though.

I really hope they don't get acquired by one of the big cloud providers.

Someone mentioned Cloudflare as a possible acquirer which makes a lot more sense than one of the big providers. Though I wouldn't be too surprised to see Google pick them up either.

Re: DigitalOcean is laying off staff

#140

Post by iudqnolq »

mrtksn wrote: post #92
Meekro wrote: post #54

Digital Ocean is a great company in a brutal, low-margin industry. Based on having run a similar (now mostly defunct) company in the past, I would guess that 80% of their customers are on the $5/mo plan. That $5/mo has to cover the hardware costs: you're buying expensive physical servers to put the VPSes on, and lots of SSDs too. SSDs have a limited lifetime measured in writes, and some of your customers will leave b…

They also have a referral program that turned DigitalOcean to free hosting for me. A few years ago I got annoyed with something, wrote an article about how to fix it using a DO instance, linked to DO with my referral code and racked up thousands of $ in a payout. I used most when experimenting and feeling too lazy to shut down instances(because I didn't want to go through backup since maybe I will use it later etc).…

I don't quite understand the economics of referral programs. I'm dealing with levels of customer support to get signed up for a $120/paying signup referral program (cash not credits).

I don't understand

a) How does this possibly make them money?

b) If they want signups that much, why is the flow for joining the referral program so buggy?

(It's Mailgun, btw)

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