You’re saying a single company can buy and maintain a server infrastructure cheaper than rates like .0001 cent per request? Yeah I don’t quite believe that. An entire industry moved to using AWS because it was cheaper.
AWS sucks for several reasons but let’s not pretend it’s more expensive than self hosting
I have not seen that claim until now. I always have been told the entire existence of AWS is because it’s way cheaper than self hosting and that makes sense to me
It’s never been cheaper. It’s so much easier to scale. It’s never been cheaper. Well, maybe at a very low usage rate. But, at scale, it’s never been cheaper.
Buying server hardware is a lot more difficult and with more lead time than just buying a computer. Plus you then have to build your server infrastructure out in a data center. It takes a lot of time, and specific logistical skills. AWS is far easier to scale your services then doing it yourself, especially if you have extremely high peaks that you have to serve.
If AWS was cheaper then hosting, they wouldn’t make money.
The upfront cost of entering the market getting higher and higher as an industry matures is one of the major reasons why we have incomplete competition and monopolies. If as a scrappy underdog you “just” need to build a network of serverfarms and hire the people to design, manage and run all that so you can just even start to dream about competing with the goliaths that basically have all that built and more then in practice you are not entering that market. That upfront cost is the issue, not the cost of running it in the long run.
It’s not even some malicious plot, it’s just the cost of doing business in a maturing market gets higher as technology advances. All these cloud providers know this upfront cost issue. White it’s easier to start with AWS they will try to keep everybody locked in so they can milk every cent out of their techofeudal peasants living in their fiefdom if they ever make it. If anybody wants to get out they need to cough up the cash to build all that infrastructure while still paying for Amazon to keep them going.
In SOME cases, it is cheaper than on prem.
If you need a lot of compute power occasionally, it can be cheaper.
If you actually scale up and down according to the load (which a lot of companies do not do), it might be cheaper.
But a large amount of companies don’t fall in those cases or don’t do it efficiently.
Some spend in a year the same amount they would have paid for on prem servers they would have kept 5 years or more.
Cloud providers offer other things like multi regional redundancy, which can be hard to achieve for smaller businesses.
its cost more money upfront, since companies need to invest money to build their servers/server racks. You can also still rent space in a data-center, without the need of building your own data center.
But on the long run, it can be much cheaper than constantly renting all the hardware. You can compare it to houses, buying a house costs more money then renting. But overall in the long run, you are normally better off buying a property (assuming you can of course… its just an example).
The issue with cloud providers like AWS is that they charge for virtually everything, and that makes it easy to rack up charges if you forget about something you spun up as a test last week and forgot to terminate it. For larger companies it can be a significant issue. So there are other companies out there that you can use to scan your entire AWS account, summarize what you’re using, and highlight things you may not need any more. They’ll also recommend cost savings measures like paying for a year of server time up front instead of paying as you go. If you know you’ll need a server for a year then paying annually is a lot less expensive.
On the plus side, you don’t need to deal with things like hardware failures. We have a large AWS environment where I work, and we’ll occasionally get an email informing us that an instance is “running on degraded hardware”. A simple reboot (power cycle) will move the instance to new hardware. And if you decide you need more RAM, more CPUs etc. then it’s also as simple as rebooting.
Their servers are slow, I have seen that myself, but I don’t see how it wouldn’t be cheaper to use AWS other than maybe some highly specific scenarios.
There are some very few specific use case that most companies don’t ever meet that makes AWS cheaper. In the vast majority of use cases it is an order of magnitude more expensive.
It’s about short term vs long term costs, and AWS has priced itself to make it cheaper short term but a bit more expensive long term.
Companies are more focused on the short term - even if something like AWS is more expensive long term, if it saves money in the short term that money can be used for something else.
Also many companies don’t have the money upfront to build out their own infrastructure quickly in the short term, but can afford longer term gradual costs. The hope would be even though it’s more expensive, they reach a scale faster where they make bigger profits and it was worth the extra expense to AWS.
This is how a lot of outsourcing works. And it’s exacerbated by many companies being very short term and stock price focused. Companies could invest in their own infrastructure for long term gain, but they often favour short term profit boosts and cost reduction to boost their share price or pay out to share holders.
Companies frequently so things not in their long term interests for this reason. For example, companies that own their own land and buildings sell them off and rent them back. Short term it gives them a financial boost, long term it’s a permanent cost and loss of assets.
In Signals case it’s less of a choice; it’s funded by donations and just doesn’t have the money to build out it’s own data centre network. Donations will support ongoing gradual and scaling costs, but it’s unlikely they’d ever get a huge tranch of cash to be able to build data centres world wide. They should still be using multiple providers and they should also look to buildup some Infrastructure of their own for resilience and lower long term costs.
You’re saying a single company can buy and maintain a server infrastructure cheaper than rates like .0001 cent per request? Yeah I don’t quite believe that. An entire industry moved to using AWS because it was cheaper.
AWS sucks for several reasons but let’s not pretend it’s more expensive than self hosting
Have you not been seeing it is in some cases. And companies are going back to on orem because it’s cheaper.
I have not seen that claim until now. I always have been told the entire existence of AWS is because it’s way cheaper than self hosting and that makes sense to me
It’s never been cheaper. It’s so much easier to scale. It’s never been cheaper. Well, maybe at a very low usage rate. But, at scale, it’s never been cheaper.
Buying server hardware is a lot more difficult and with more lead time than just buying a computer. Plus you then have to build your server infrastructure out in a data center. It takes a lot of time, and specific logistical skills. AWS is far easier to scale your services then doing it yourself, especially if you have extremely high peaks that you have to serve.
If AWS was cheaper then hosting, they wouldn’t make money.
The upfront cost of entering the market getting higher and higher as an industry matures is one of the major reasons why we have incomplete competition and monopolies. If as a scrappy underdog you “just” need to build a network of serverfarms and hire the people to design, manage and run all that so you can just even start to dream about competing with the goliaths that basically have all that built and more then in practice you are not entering that market. That upfront cost is the issue, not the cost of running it in the long run.
It’s not even some malicious plot, it’s just the cost of doing business in a maturing market gets higher as technology advances. All these cloud providers know this upfront cost issue. White it’s easier to start with AWS they will try to keep everybody locked in so they can milk every cent out of their techofeudal peasants living in their fiefdom if they ever make it. If anybody wants to get out they need to cough up the cash to build all that infrastructure while still paying for Amazon to keep them going.
In SOME cases, it is cheaper than on prem. If you need a lot of compute power occasionally, it can be cheaper. If you actually scale up and down according to the load (which a lot of companies do not do), it might be cheaper. But a large amount of companies don’t fall in those cases or don’t do it efficiently. Some spend in a year the same amount they would have paid for on prem servers they would have kept 5 years or more.
Cloud providers offer other things like multi regional redundancy, which can be hard to achieve for smaller businesses.
Thank you for the thoughtful response and not just downvoting like most others!
is this really true tho? i mean just recently i saw someone say that hosting on bare metal for example gave them like a 2 or 3 times more performance
so i wonder if, exspecially for bigger companies, if this is really cheaper at all. It sounds less efficient
its cost more money upfront, since companies need to invest money to build their servers/server racks. You can also still rent space in a data-center, without the need of building your own data center.
But on the long run, it can be much cheaper than constantly renting all the hardware. You can compare it to houses, buying a house costs more money then renting. But overall in the long run, you are normally better off buying a property (assuming you can of course… its just an example).
The issue with cloud providers like AWS is that they charge for virtually everything, and that makes it easy to rack up charges if you forget about something you spun up as a test last week and forgot to terminate it. For larger companies it can be a significant issue. So there are other companies out there that you can use to scan your entire AWS account, summarize what you’re using, and highlight things you may not need any more. They’ll also recommend cost savings measures like paying for a year of server time up front instead of paying as you go. If you know you’ll need a server for a year then paying annually is a lot less expensive.
On the plus side, you don’t need to deal with things like hardware failures. We have a large AWS environment where I work, and we’ll occasionally get an email informing us that an instance is “running on degraded hardware”. A simple reboot (power cycle) will move the instance to new hardware. And if you decide you need more RAM, more CPUs etc. then it’s also as simple as rebooting.
Their servers are slow, I have seen that myself, but I don’t see how it wouldn’t be cheaper to use AWS other than maybe some highly specific scenarios.
You have it backwards.
There are some very few specific use case that most companies don’t ever meet that makes AWS cheaper. In the vast majority of use cases it is an order of magnitude more expensive.
It’s about short term vs long term costs, and AWS has priced itself to make it cheaper short term but a bit more expensive long term.
Companies are more focused on the short term - even if something like AWS is more expensive long term, if it saves money in the short term that money can be used for something else.
Also many companies don’t have the money upfront to build out their own infrastructure quickly in the short term, but can afford longer term gradual costs. The hope would be even though it’s more expensive, they reach a scale faster where they make bigger profits and it was worth the extra expense to AWS.
This is how a lot of outsourcing works. And it’s exacerbated by many companies being very short term and stock price focused. Companies could invest in their own infrastructure for long term gain, but they often favour short term profit boosts and cost reduction to boost their share price or pay out to share holders.
Companies frequently so things not in their long term interests for this reason. For example, companies that own their own land and buildings sell them off and rent them back. Short term it gives them a financial boost, long term it’s a permanent cost and loss of assets.
In Signals case it’s less of a choice; it’s funded by donations and just doesn’t have the money to build out it’s own data centre network. Donations will support ongoing gradual and scaling costs, but it’s unlikely they’d ever get a huge tranch of cash to be able to build data centres world wide. They should still be using multiple providers and they should also look to buildup some Infrastructure of their own for resilience and lower long term costs.