Why Some Startups Say the Cloud Is a Waste of Money
1–10 of 58 posts
Re: Why Some Startups Say the Cloud Is a Waste of Money
#2When you're just starting out the cloud is significantly cheaper. When you're growing, it's good to have that support network. When you get large enough, it's more cost effective to actually own hardware.
My question is, how large is large enough to warrant owning your own hardware? What's the breaking point?
Re: Why Some Startups Say the Cloud Is a Waste of Money
#3Linkbait - this is just common sense.
New companies also rent office space but at a certain point they buy/build their own. Should we say 'Why some companies say office rental is a waste of money'?
Re: Why Some Startups Say the Cloud Is a Waste of Money
#4Linkbait - this is just common sense. New companies also rent office space but at a certain point they buy/build their own. Should we say 'Why some companies say office rental is a waste of money'?
I disagree that everybody knows this.
Cloud services are marketed as extremely scalable solutions that grow with your business. I doubt that everybody starting out realizes that the costs can grow at a much faster rate than your revenue.
Re: Why Some Startups Say the Cloud Is a Waste of Money
#5Linkbait - this is just common sense. New companies also rent office space but at a certain point they buy/build their own. Should we say 'Why some companies say office rental is a waste of money'?
I disagree that everybody knows this. Cloud services are marketed as extremely scalable solutions that grow with your business. I doubt that everybody starting out realizes that the costs can grow at a much faster rate than your revenue.
I don't know. Even engineers who don't know right from left seem to grok it. ;)
(http://www.wired.com/wiredenterprise/wp-content/uploads/2013...)
Re: Why Some Startups Say the Cloud Is a Waste of Money
#6Basically the Cloud is a stepping stone on your way to greater things. You may outgrow the cloud or you may find you have economies of scale where the cloud is becomes the expensive option. Recognise it and change your set up.
TBH you should be doing this with all aspects of the business. Start in a room/garage, move to serviced offices, then rent your own building, then buy your own building (should it become financially viable).
I think this is basic Return On Investment analysis.
Re: Why Some Startups Say the Cloud Is a Waste of Money
#7When you're just starting out the cloud is significantly cheaper. When you're growing, it's good to have that support network. When you get large enough, it's more cost effective to actually own hardware. My question is, how large is large enough to warrant owning your own hardware? What's the breaking point?
Owning your hardware? Quite high. Renting dedicated servers rather than paying by the hour for cloud servers? That's cheaper pretty much from day 1.
Re: Why Some Startups Say the Cloud Is a Waste of Money
#8When you're just starting out the cloud is significantly cheaper. When you're growing, it's good to have that support network. When you get large enough, it's more cost effective to actually own hardware. My question is, how large is large enough to warrant owning your own hardware? What's the breaking point?
What I look at is how consistent your demand is: if you're spinning cloud instances up based on bursty traffic, it'll probably make sense to buy servers only to meet the consistent load and figure out the best way to share data with on-demand instances.
Re: Why Some Startups Say the Cloud Is a Waste of Money
#9When you're just starting out the cloud is significantly cheaper. When you're growing, it's good to have that support network. When you get large enough, it's more cost effective to actually own hardware. My question is, how large is large enough to warrant owning your own hardware? What's the breaking point?
well, it's actually a very easy thing to quantify, but the cost/benefit analysis is different for every kind of company and computing requirement -
the REAL problem is it takes experience in running your own datacenter or at least colocated hardware to perform this analysis, and almost nobody does this because they all work for large internal IT orgs or the cloud providers themselves.
Re: Why Some Startups Say the Cloud Is a Waste of Money
#10When you're just starting out the cloud is significantly cheaper. When you're growing, it's good to have that support network. When you get large enough, it's more cost effective to actually own hardware. My question is, how large is large enough to warrant owning your own hardware? What's the breaking point?
There's also the matter of how long you expect to maintain certain things, and how fast you're changing stuff around. The cloud is optimized for changing things really quickly, where hardware is optimized for long-term cost effectiveness of relatively static assets.
For example: The Obama campaign famously ran almost entirely in the cloud, because it was run like a startup that knew exactly when it would be shutting down. But the DNC runs mostly on physical hardware, because it's expected to function indefinitely.