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FedEx to close data centers, retire mainframes

datacenterdynamics.com

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Re: FedEx to close data centers, retire mainframes

#511

Post by eikenberry »

kragen wrote: post #493
eikenberry wrote: post #444

Earlier quoted context omitted.

Why be an information infrastructure company on top of a delivery company? Why would they want to do both if they didn't need to. And pretty much all companies are going multi-vendor to avoid lockin and provide leverage for negotiations. Their information is the part that runs the company, not the stack.

Why be a management company on top of a delivery company? Or a finance company on top of a delivery company? Or an employer on top of a delivery company? Because if you outsource any of those functions 100%, your vendor owns the actual company.

If your company is already public (like FedEx) then you don't own your company anyways. So who cares who owns it. All that matters is that it profits the shareholders.

Re: FedEx to close data centers, retire mainframes

#512

Post by bsder »

dehrmann wrote: post #505
bsder wrote: post #468

Earlier quoted context omitted.

The economics favors distributed storage rather than generation. I worked in a building during rolling blackouts in California. The Tesla Powerwall on the building was "screaming" (ultrasonic harmonics from piezo components) 24/7. The security guy actually came to get me to ask if the thing was going to explode. Clearly, the building owner was load shifting and making quite a bit of money from it.

> The economics favors distributed storage rather than generation. They shouldn't, though. If powerwalls are that great, it should be more cost effective to install giant banks of them in cheap warehouses outside major metros since you'll have economies of scale on installation and maintenance. Utilities are sorta getting into this game, but it's more common at the individual level, despite being more expensive.

> If powerwalls are that great, it should be more cost effective to install giant banks of them in cheap warehouses outside major metros since you'll have economies of scale on installation and maintenance.

This works only if the electrical grid has the ability to consume back your stored power. Most electrical grids in the US would have problems doing that.

For example, UCSD has their own generating facility; however, SDG&E was sufficiently backward that UCSD was unwilling to go through the grief necessary to put energy back into the grid. Therefore, UCSD only does load shifting or disconnects the campus from the grid during rolling blackouts.

Because of the poor energy grid transport, storage batteries make the most sense when you can consume the stored energy locally to minimize your grid consumption during high energy prices--ie. you have a high-rise office with lots of air conditioning or a manufacturing facility.

Re: FedEx to close data centers, retire mainframes

#513

Post by mbesto »

ClumsyPilot wrote: post #508
mbesto wrote: post #496

Earlier quoted context omitted.

Wait, are you saying that an org needs expertise to QC all of the the hardware they procure? How expensive is that? How easy it is to hire that type of QC? Do you see how these costs all start to add up?

Well, are you saying that an org needs expertise to inspect faulty cars, like, by calling a mechanic? Is that like too much these days for companies that owb fleets of cars? is opening a server harder than checking whars wrong with a car? like a cable comes loose and that's gane over?

If I procure a fleet of cars I expect none of them to be faulty...how about you?

Re: FedEx to close data centers, retire mainframes

#514

Post by dhzhzjsbevs »

cs702 wrote: post #36
kragen wrote: post #19

Ultimately companies that abdicate their informatics operations like this will give their profits to their data-center operators, who will be empowered to charge them whatever price they want. Because what's their BATNA? Migrating from Azure to AWS when Microsoft doesn't want to let them? Renting your information infrastructure is a great way to reduce startup costs, but down the road, that information infrastructure…

Without a doubt, a future generation of executives will revisit and reverse the decision to rent all information infrastructure, but that will likely be many, many years down the road. In the meantime, the current generation of executives who made this decision will look very smart for saving the company lots of money for a good number of years. And they stand to benefit personally from it. They're doing the rational…

We have our own datacentres. Lucky enough to have got them up and running pre cloud era. If we were any later we would be full cloud but the reality is we outcompete everyone on price in our space because of it.

Re: FedEx to close data centers, retire mainframes

#515

Post by vlovich123 »

luhn wrote: post #409
vlovich123 wrote: post #205

Earlier quoted context omitted.

Re data, I think egress rates are going to start disappearing over the next few years. The part that’s always missing with these rent vs buy analyses on HN for some reason is that it’s totally ignoring the opex cost of operating your own hardware which is going to be non 0. Sure, it won’t be quite as expensive (no profit margin) but it’s not an order of magnitude. Additionally, most companies don’t run the HW 24/7 an…

> Re data, I think egress rates are going to start disappearing over the next few years. I'm not sure why you think that. AWS hasn't budged on their egress pricing for a decade (except the recent free tier expansion), despite the underlying costs dropping dramatically. GCP and Azure have similar prices. Fact is, egress pricing is a moat. Cloud providers want to incentivize bringing data in (ingress is always free) an…

Disclosure: I work on Cloudflare on R2 so I’m a bit biased on this.

I think we’re going to put real pressure for traditional object storage rates to come down. Since Cloudflare‘a entire MO is running the network with zero egress. As we expand our cloud platform it seems inevitable that you will at least have a strong zero egress choice and if we do a good job Amazon et all will inevitably be forced to get rid of egress. Matthew Prince laid out a strong case for why either scenario is good for us in a recent investor day presentation (either we cannibalize S3’s business and R2 becomes a massive profit machine for us because they refuse to budge on egress or Amazon drops egress which is an even larger opportunity for us).

Products like Cache Reserve help you migrate your data out of AWS transparently from any service (not just S3) - you just pay the egress penalty once per file.

Anyway. I’m not saying it’s going to disappear tomorrow but I find it hard to believe it’ll last another ten years.

Re: FedEx to close data centers, retire mainframes

#516

Post by vlovich123 »

landemva wrote: post #309
vlovich123 wrote: post #205

Earlier quoted context omitted.

Re data, I think egress rates are going to start disappearing over the next few years. The part that’s always missing with these rent vs buy analyses on HN for some reason is that it’s totally ignoring the opex cost of operating your own hardware which is going to be non 0. Sure, it won’t be quite as expensive (no profit margin) but it’s not an order of magnitude. Additionally, most companies don’t run the HW 24/7 an…

>> I think egress rates are going to start disappearing over the next few years. Compute costs generally drop over time. Do you have any data points to confirm egress will soon go to zero?

Cloudflare Bandwidth Alliance and R2. S3 felt some pressure just because of our pre launch announcement. It’ll be interesting to see how they adjust over the next couple of years.

Re: FedEx to close data centers, retire mainframes

#517

Post by raxxorraxor »

nemothekid wrote: post #243
raxxorraxor wrote: post #224

Earlier quoted context omitted.

I host a lot on AWS but you will need as many people in IT support as before. You can use consultants for a time but after a while your infrastructure will disintegrate because nobody knows about the intrinsic properties the infrastructure of your company. I believe the self hosted options generally offer vastly more flexibility and can innovate at a faster pace. But only FedEx will know if it is a good decision, per…

> I host a lot on AWS but you will need as many people in IT support as before This doesn't pass the smell test at all. Datacenter ops are way more complex than AWS ops; why would someone on cloud need IT support for VMWare, BMC Ops, Power management and generation, supply chain management and land leasing/renting? These are the few roles, off the top of my head, that just go away when moving to the cloud at FedEx's…

Well, I didn't really meant data centers, just in general on premise infrastructure. There is a difference of course. Our administration is almost completely in the cloud, but for production and some adapted applications we still need local data. There is simply no technical solution to run everything in the cloud and we also want to retain some data locally. VMWare is an example. UPS and backups are another. Sure, we use service providers for provisioning of new VMs but IT still needs to do maintenance of the software that runs on it, needs to keep inventory about the servers running in the company. And if you have one VM running additional provisioning is not too much work.

But sure, at the scale of FedEx this is true, they also probably have a very high percentage of administration only. Although I still think the cooperation with MS was still a strategically planned after paying attention to Amazon.

Re: FedEx to close data centers, retire mainframes

#518

Post by nix23 »

mbesto wrote: post #513
ClumsyPilot wrote: post #508

Earlier quoted context omitted.

Well, are you saying that an org needs expertise to inspect faulty cars, like, by calling a mechanic? Is that like too much these days for companies that owb fleets of cars? is opening a server harder than checking whars wrong with a car? like a cable comes loose and that's gane over?

If I procure a fleet of cars I expect none of them to be faulty...how about you?

>I expect none of them to be faulty

So you don't even test the car's, you just expect that the tire pressure is correct, tank is full?

Expect that something "just" works is exactly why pilots have checklist's.

Expectations are the main point for disappointments, you would never do that with software right?

Re: FedEx to close data centers, retire mainframes

#519

Post by prmoustache »

kragen wrote: post #19

Ultimately companies that abdicate their informatics operations like this will give their profits to their data-center operators, who will be empowered to charge them whatever price they want. Because what's their BATNA? Migrating from Azure to AWS when Microsoft doesn't want to let them? Renting your information infrastructure is a great way to reduce startup costs, but down the road, that information infrastructure…

I am pretty sure part of it is also some kind of greenwashing move to abstract away your carbon footprint. Like exporting pollution to far east by producing there. Sure there are tools to calculate your energy/carbon footprint from cloud workloads but if you don't operate a datacenter yourself anymore you can't be as much accountable as the cloud vendor is.

But there will surely be a backlash and an - at least partial - return to operating your own datacenter for some companies in the future.

Re: FedEx to close data centers, retire mainframes

#520

Post by dx034 »

mbesto wrote: post #278
ocdtrekkie wrote: post #186

Earlier quoted context omitted.

You're paying for all of that whether it's the cloud or on-prem. The only real difference if you're a large company is whether you're paying another company's profit margin as well. If you are big enough to have your own datacenter, you are paying Amazon enough to buy that much physical space, power, bandwidth, IT staff, etc. plus funding Bezos' trips to space. There's a justifiable niche where you're too small to ju…

> You're paying for all of that whether it's the cloud or on-prem. The only real difference if you're a large company is whether you're paying another company's profit margin as well. So, then why even provide the distinction of rent vs own if thats the case? > you are paying Amazon enough to buy that much physical space, power, bandwidth, IT staff, etc. And you're also sharing the costs with other people. Clearly Fe…

> Clearly FedEx is saving $400M/year while also funding Bezo's trips to space, no?

I wonder how much they'd save if they rebuilt their infrastructure with own DCs. There are huge savings in decommissioning mainframes, switching to free software and automating more. At the scale of Fedex, I don't think they'll spend much more on hardware and ops than AWS.

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