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Why Some Startups Say the Cloud Is a Waste of Money

wired.com

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Re: Why Some Startups Say the Cloud Is a Waste of Money

#41

Post by bcoates »

Well, yeah, an in-memory database company is going to be underwhelmed by EC2. Their RAM pricing isn't competitive. The Amazon sweet spot tends more towards storage and internal I/O bandwidth.

The article completely ignores this point, but if you're comparing a cloud offering to colo or building a datacenter, the extent to which the cloud system corresponds to the nature of your workload is critical. Cloud gives you one sort of flexibility (size-over-time and provisioning) and takes away another (physical architecture design).

Re: Why Some Startups Say the Cloud Is a Waste of Money

#42

Post by waxzce »

echohack wrote: post #35
snowwolf wrote: post #21

Earlier quoted context omitted.

And how many extra 'DevOps' people has the company now had to employ to manage these physical servers, and what is their annual salary? This never seems to be factored into the calculations.

This this this. And what is the turnaround time on getting new servers provisioned for development? Are they using Docker, or are they stuck in Windows land where there's no open source private PaaS solution that makes any sense? How many of those servers have virtual machines provisioned and then those virtual machines sit idle? How long until the cruft virtual machines are so populous that they take up an ever incr…

You can also use public PaaS

Re: Why Some Startups Say the Cloud Is a Waste of Money

#43

Post by waxzce »

I think Cloud efficiency is about time saving. Is it cost efficient to rent on AWS expensive hardware with the worse uptime of the market ? Nop But the cloud is not only that : with a proper solution like PaaS, you can just focus on what is important for you : your code. The point is : find a provider who is responsible for your service be up and running and forget about it. At Clever Cloud we detect the load and adjust resources, we deploy for you, we monitor for you... This is the real goal of cloud computing : forget about hosting, it's just working, and focus on your own added value.

Re: Why Some Startups Say the Cloud Is a Waste of Money

#44

Post by mtkd »

There are a lot of hidden costs to the inflexibility of running local hardware.

With hosted you get:

- 24h availability of mixed skills sets (e.g. Cisco at 4am)

- ability to expand if under load/attack

- costs in proportion to revenue (sales go down you can have lower opex next month)

- ability to move resource around the globe in days

Some of this becomes critical if you get to point that SLAs matter.

Re: Why Some Startups Say the Cloud Is a Waste of Money

#45

Post by thezilch »

snowwolf wrote: post #21
bluedino wrote: post #14

>> That’s $324,000 a year. But for just $120,000, the company could buy all the physical servers it needed for the job What about power, cooling, rent in the building for the room you're keeping them in, backup generator, internet connectivity, administration costs (setup, repairs, installation), etc? >> “The public cloud is phenomenal if you really need its elasticity,” Frenkiel says. “But if you don’t — if you do a…

And how many extra 'DevOps' people has the company now had to employ to manage these physical servers, and what is their annual salary? This never seems to be factored into the calculations.

One? Your colo probably also will rent you help to rack, wire, and anything else physical. How many days do you expect to be "downtown?" Apart from the physical / racking aspect, it's not like your Ops has any less work to do with respect to clouds. You still have to manage your own software services, security, etc on either platform.

You could triple your provisions with the savings of not being on the cloud, so it's hard to believe you won't see the train coming, if the concern is having to rack more than 20-60 servers a day. Arguably, that would be a good problem to have!

Re: Why Some Startups Say the Cloud Is a Waste of Money

#46

Post by jandrewrogers »

The high cost aside, which can make sense up to a point because it saves on operations costs at small scales, the other big problem with the cloud is that for many types of applications the virtualization, storage and network topology destroys the performance. Some types of server engines in particular do not play well with these cloud environments and it is not a defect in the server engine design.

This is the main reason we stopped using the cloud and built our own server infrastructure. We could get 2-3x performance out of the same hardware simply by taking control of the physical machines and the network topology. The combined performance loss and high markup made it difficult to justify the cloud price performance relative to our own clusters.

There is no panacea for infrastructure. Every company needs to consider their own requirements.

Re: Why Some Startups Say the Cloud Is a Waste of Money

#47

Post by simonebrunozzi »

beat wrote: post #24
snowwolf wrote: post #21

Earlier quoted context omitted.

And how many extra 'DevOps' people has the company now had to employ to manage these physical servers, and what is their annual salary? This never seems to be factored into the calculations.

That was my first thought, too. Physical hardware == more staff. Also consider the risk management of keeping your security up to date, and the opportunity costs of making it easy to use for developers. Spend some time in old-school enterprise, and you'll see just how much pain and grief can happen. Remember, Amazon built its cloud not for the public, but for itself! The cloud gave them a clean separation of duties a…

The "excess capacity" is a pure myth. When AWS started, it was using a set of Data Centers which had nothing to do with Amazon.com (the Retail part of it). Now Amazon.com is just another (big) customer of AWS.

Disclaimer: I work for AWS.

Re: Why Some Startups Say the Cloud Is a Waste of Money

#48

Post by thezilch »

mtkd wrote: post #44

There are a lot of hidden costs to the inflexibility of running local hardware. With hosted you get: - 24h availability of mixed skills sets (e.g. Cisco at 4am) - ability to expand if under load/attack - costs in proportion to revenue (sales go down you can have lower opex next month) - ability to move resource around the globe in days Some of this becomes critical if you get to point that SLAs matter.

I'm trying to think of someone, other than Netflix, that has weathered cloud outages, and even THEY frequently have to deal with the weight of supporting a cloud topology. How many times has AWS's provisioning fabric gone out?

Re: Why Some Startups Say the Cloud Is a Waste of Money

#49

Post by purple_horse »

beat wrote: post #37
purple_horse wrote: post #34

Earlier quoted context omitted.

With modern tools like Fully Automatic Install and Ansible/Puppet it shouldn't be any more than for a Cloud service.

But once you have a legacy system, getting the modern tools in there can be a real pain. Instant snowflake, just add expensive and archaic enterprise middleware.

True, but the article is talking about a startup building from scratch.

Re: Why Some Startups Say the Cloud Is a Waste of Money

#50

Post by nissimk »

The 1/3 rule applies well: If you are only using the server one third of the time then AWS is a good deal. That could mean 8 hours per day or 10 days per month or 4 months per year. In those cases AWS/public cloud is more efficient and convenient than buying servers, but there are additional exceptions.

Certain applications with lower uptime requirements (test environments) can be run on decommissioned older prod server hardware if you have that.

Legacy enterprise applications that rely on extremely fast database access with large relational databases and poor caching are better suited to bare metal DB servers than virtual servers of any kind (public or private).

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