The battle of the computing clouds is intensifying
economist.com
economist.com
That's not accurate because many businesses do migrate for cost reasons. Especially for internal non-public facing servers like email. E.g. They moved from self-hosted Microsoft Exchange servers to cloud-managed email like Office 365 Exchange Online -- or switch to another cloud competitor like G Suite.
>Ms Wang and Mr Casado have suggested that firms should think about building their own private clouds to keep costs down. So far few firms have opted for such “repatriation”, which is both costly and makes it harder for businesses to enjoy the benefits of essentially unlimited computing resources in the public cloud.
As a case study, The Guardian newspaper tried building their own private cloud and failed. They ultimately just went with AWS: https://web.archive.org/web/20160319022029/https://www.compu...
If the company's business profit is not in the tech sector (like The Guardian), this means its IT datacenter operations is not its core competency which makes it hard to build internal IT that can keep up with AWS capabilities. Tech businesses like Dropbox, Facebook, can hire & maintain skilled IT staff like AWS but most other non-tech businesses can't.
What I see often is that it's hard and costly to replicate the whole cloud experience in-house. OpenStack is a behemoth to operate. However, if you build something more specific to your needs (and often mix in selected public cloud services), you'll get a much cheaper stack.
Small businesses can often run very efficiently with a few rented physical servers in a colo, G Suite and AWS S3.
Larger ones can provide a platform specific to the technologies used in-house and combine with public cloud for any other tech stacks.
Operating a small ceph cluster is almost a full time job, at least if you care about your data...
I guess the equation changes when you have more data or looser requirements. That's actually my point. It's very hard to recreate the whole AWS experience, but it's quite possible to pick any piece and do it much cheaper.
Think Urbit but for sysadmins and you pretty much get the vibe.
At the time I last tried it (some two or three years ago):
- most of the documentation was written assuming an rpm-based distro and not Ubuntu or Debian (I remember especially having had trouble with subtle differences in iptables/nftables between the distributions)
- on top of that it was right in the middle of a python2 => 3 migration with the result of shit breaking left and right
- it was/still is written in Python which means a second or more for every CLI command to initialize, much less actually do something
- half the instructions in the documentation seem to never have been actually tested, which combined with the two points above made for a really punishing "experience", especially with more rarely-used features such as k8s-in-openstack
- the documentation itself still is (just looked it up) badly organized, with you needing to read four guides (Install, User, Configuration, Ops/Administration) per OpenStack component. Ideally, there should only be one guide for Installation/Upgrade (including Configuration and everything from Ops/Admin) that has everything in it to get all supported parts of the component up and running, one User's Guide that shows how the component is used and what the best practices are, and one Troubleshooting guide.
If you can set it up into a working configuration, it's a nice project for sure. But the road to that point is rough, and you will likely not even want to think about an upgrade simply because of how complex it is.
It worked like this - you had to fill a form to request a VM. After a few emails (and days because time zones), you got a few years old RHEL VM without root access, but also without any real support from the ops organization. They tried to provide the generic cloud experience with VMs and failed.
Ten years ago I loved the cloud because it broke the monopoly / organizational dictatorship of IT in large organizations, always a wellspring of "daily wtfs".
But now the cloud is becoming too powerful, and too small in number. We NEED a competitive-ish on-prems approach... but... what is it? Does anyone have a template to do so? They aren't well advertised that's for sure.
AWS is NOT CHEAP. It may be slightly cheaper than the old monolith IT orgs' DCs, and far more flexible, but it's not cheap. There has to be a way to accept less flexibility for substantial savings over reserved instances and negotiated discounts.
For christsakes, a Raspberry Pi would make a perfectly good server for massive ranges of use cases. 20$ and ultra low power.
Or at least, that's part of AWS' sales pitch. But it makes sense, if you're just an application developer, you can fire up a hosted, scalable, redundant cluster fairly easily and quickly, whereas if you go self-hosted you need to buy hardware, colocation, and either know or hire people that can set it up and mange it.
You just might impress top brass and convince them to get on this bandwagon before they are disrupted.
But yes technically it's "cloud" in the sense that it's still someone else's computer for rent.
Scale does NOT matter for the vast majority of usecases. For example, the parent comment talked about on-prem exchange server.
Working in enterprise software, I was am always surprised when I find a killer feature may not the functional value of something we've built, but that fact it works around some internal disfunction of operations between internal teams.
Most businesses will look at the relative costs and opt for a private cloud solution, then price in the risk and go for the cloud solution. There is no reason the Guardian must control its own hardware.
No, but it has potential political ramifications, right?
All the Cloud providers are US. Does this mean the guardian will be more wary about saying anything negative about the US?
All the cloud providers are big companies, does this mean that the Guardian might be less critical of big companies?
Obviously being completely vendor agnostic is difficult; but we shouldn't pretend that there could not be backlash in unexpected ways- even if "hosting is not a core competency".
A thing that comes to my mind is Edward Snowden's revaluations: given the things he talked about (NSA was even tapping Google lines, for example): how could any whistleblower expect to not be exposed by accident if everyone is using a cloud provider in the US?
It just strikes me as marginally naive to assume that nothing can/could go wrong here, you hand off an immeasurably large amount of control to an ambivalent entity and whatever regime they happen to be under.
I now realize the cloud providers are willing and able to express political opinions and delist people/companies that disagree with political parties.
We're betting that not everyone will be in the main public clouds for these reasons and prepared for the pendulum to swing back for some applications. Financial services companies for example still have major on-prem / self-managed footprints. They are very sophisticated consumers.
(My company Altinity was the one cited at the head of the article.)
By that logic a bookseller has no business running the world’s largest cloud!
Not that I’m disagreeing with you in general, Amazon is very much an exception to the rule.
With the new overlords, I have to pass through fewer reviews (I work in financial sector; we love review meetings and gates.) and provisioning a service is as simple as a AWS/GCP/Azure url. And tearing down stuff is easier. The old overlords of IT would be pissed if we decided we did not need a h/w server and we would have to fill out questionaires to determine how we could have been so misguided and then I had to wear my dunce hat for any meeting we would have for the next requisition.
I love the battle of cloud computing. With the big three, they are still hold too much power. I look forward to the day when Vultr, DigitalOcean, Ovh, Linode can get approved to be used in my employer's IT stack. With Terraform or Kubernetes, I would be able change our dev/qa/uat cloud environments at will and this will force the Big Three to lower their prices even more.
In new cloud land you're essentially contracting out a team at Amazon to handle all that. You can rent a team that is dedicated to that one particular service. In cloud land behind every service there is a whole team of people dedicated to maintaining that particular service, in on-prem land behind every service is a 1/20th of the capacity of your IT team.
Lot harder to refund that new server that was just installed on the rack.
This stuff has nothing to do with cloud but mainly on how the business thinks off and controls IT.
Some finance businesses have the resourses to hand to compete with the cloud providers or at least create internal self managed equivalent
Edit: Also I was way more fit from climbing around a building all day cabling stuff. Genuine question - does anyone know what sort of IT jobs require physical work? I miss those days a lot!
I have seen a few positions in the US for datacenter technicians. Those positions had explicit requirements(probably because of ADA) to be able to lift over X lbs as part of day to day activities.
I don't think it was ever profitable unless your energy prices can compete with what industrial-scale miners get in favourable locations (right next to a power plant in an area with too much surplus power, etc).
"Is it really profitable to get in, like now?" Yes, but... Long version: Yes, you will make your money back within 2 years almost guaranteed on a new mining rig. There is a minimum cost to get in. For example, at a minimum, you will need a good card at 3k+, which puts you at 3.5-4k just for price of entry. However, you will make that back within a year.
Now the heavy BUT:
1. No one knows what will happen once ETH switches from mining to proof of stake in 2022. Mining profits may go to 0.
2. If BTC price goes to hell, so do your profits in the long run. This is price-risk, regulatory-risk, etc.
3. There are heavy tax implications and a lot of management. For example, you won't get the returns mentioned if you don't properly account for equipment costs.
4. Once you want to make more than $10 a day, there are heavy, heavy set up costs - cooling, proper power supply, etc.
Finally, profitability of mining is back because China is actively banning crypto mining, so other areas can compete now.
"I don't think it was ever profitable unless your energy prices can compete with what industrial-scale miners get in favourable locations (right next to a power plant in an area with too much surplus power, etc"
This is simply not true Nextgrid, see https://whattomine.com/ for roughly-valid numbers. Note that BTC is not anywhere on the GPU list - you do need extremely expensive ASICs to mine BTC. You also need to order them from China, pay a 25% import tax, and overall risk quite a bit.
Final note - if you could get GPUs at cost or MSRP, you would be in pure profit in less than a year. The problem is that a $2000 GPU is marked up to about $3500 atm.
anyways, is $15/Mh a good buy because that is what it seems to be
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Yeah I distantly remember "on prem", too. Does everyone, everywhere really need to be equipped to hyperscale at a moment's notice? Wouldn't it be better not to be beholden to a megacorp that serves you with 30 pages of opaque billing for business-critcal functionality? Doesn't hiring external consultants to manage your fucking cloud infrastructure seem like sort of a risk as compared to keeping the services-wrangler in-house?
...I don't have an MBA, so these are half-serious questions. If anyone can chime in with (at least) a half-serious answer, I'd halfway appreciate it. I understand that The Economist is the voice of global capital, and global capital has decided that there's money in them thar clouds, but still!
Traditional corporate datacenters were dogshit when it came to provisioning new resources for business capabilities.
In today's world, we need the ability to spin up and down deployments very quickly. We don't need huge numbers of resources, just fast response.
People are investing in cloud because its faster, more agile and better, not because it's cheaper.
The top line looks expensive, but if you then do the correct analysis on the cost side of the equation (taking out staff costs and DC costs) then I think it is either close or in the black from a cost perspective.
If the business case was really bad, I don't think we would see the rapid uptake we have seen.
Then you have competition (GCP, Azure, Alibaba) which will tend to lower the price, but for now the cloud industry grows. Their goal is to attract new customers who didn't use the cloud before.
And the ones we got on Friday were wrong (we asked for 3 * 16GB ones + 1 * 2GB, we got a 16GB project container with 4GB pod limits).
For our hadoop request - yes it got provisioned in >8hrs (mostly I think because no one is using it) but none of the access instructions work and everyone who has used it is mysteriously unavailable - so we can't access it.
Compare and contrast to self service from any cloud.
Why : well it's demand management. If you do self service and say "pay for what you want" then IT's costs bloom and the CIO is shot. If you do that in a cloud scenario then Cloud costs bloom and the CIO says "you guys have spent your money badly". This means that you need police and you need people who you ask to give you what you need if they are happy. These people obstruct you and then get things wrong.
First, there are internal processes. All too often they end up needlessly slowing velocity. This isn't a technology problem but a people problem. Using a public cloud enables people to circumvent these issues, in some cases.
Second, there are costs. What does it cost to give someone the features they ask for in the time they want it? This is a requirements, design, time, and cost problem.
Basically small markets (internal IT) can't sustain the investment to support the requirements design time cost issue - while the public cloud folk can say "any colour you like so long as it's black" and there are enough takers to pay for it all.
Do you really? In my experience, admittedly outside of SV, pretty much nobody needs that.
That only makes sense to me in the context of a business being an IT shop to begin with. Most businesses aren't, and their new product offerings require factories and dies and labor and materials. Besides which, the problem of provisioning is entirely overblown for this scale of business. I can spin up new servers all day on our on-prem vSphere cluster.
Lots of businesses outside of 'IT shops' use computers. I currently work in Civil Engineering and more and more of our product and service offerings have an IT/Online/Web based component which involves setting up some sort server.
I can spin up new servers all day on our on-prem vSphere cluster.
I what price? At my old job an on-perm vSphere 'machine' cost my department a lot more than what AWS was charging.
At that scale in a single company the ability to provision verticals weighs heavily in architecture and design choices.
"Should we spin this new feature out as a microservice or fold it into an existing app so we don't have to wait weeks and do crazy cost accounting for new environments?" And the answer has follow-on effects because now it has to be accounted for in a specific teams' backlog and we encounter yet more waiting.
And since it's my 'private' cluster I don't have to worry about queuing my jobs and waiting for the machines to be free. There is no way my department would have bought me those machines as physical hardware.
If you don't meet those criteria, unless you are absolutely horrible at negotiating with your vendors, you aren't saving money going into the cloud. I don't care that "datacenters are expensive to build". If you are large enough to need to build your own datacenter instead of renting floorspace for pennies on the dollar from Switch or Equinix (although Equinix is kind of pricey) or Windstream or insert provider - then the datacenter is a rounding error in your 10-year IT budget.
The problem is "I moved company XYZ to the cloud" is now a requirement for an IT exec to show up to the country club on Saturday. So whether it makes any fiscal sense at all, the board wants to know "what our cloud plans are" and most execs are more than happy to oblige in order to pad that resume. In my experience, most of them leave long before the bill comes due, and people start asking why the IT budget quadrupled in 3 years. The best part is, most of these companies can't pass along that increased cost to end-customers like a Netflix can because they aren't actually making money on the apps they're hosting in the cloud, those are all internal business facing apps.
Money is ALWAYS the issue. Whether you can pass along increased cost to your customers or not is entirely dependent on what your business is and the competitive landscape of it. I don't care how "agile" the cloud makes you, if your cost of IT is more expensive than the revenue you bring in, you're bankrupt. It's the running joke around here about people who build autoscaling k8s based infrastructure for a site that could be hosted on a $5/month VPS with even a little bit of tuning and caching. Complexity for the sake of complexity is called stupidity unless you're doing it as part of an educational experience. Going to production with needless complexity is a great way to ruin a good idea.
>Cost is not the same as value.
I guess it's a good thing I didn't state that cost is the same thing as value?
I think the goal is that it should be the same amount of engineering time to set up both options, and both should cost $5 per month.
Today, that is broadly untrue. Although a few niches like appengine offer this.
With operating your own DC, you have to hire really great people and hope they don’t fuck up. You have to plan much in advance for capacity changes. It’s very much possible that something goes wrong in your compute infrastructure and simply nobody in your team has the expertise to fix it. Put it another way: can you pay/hire the same kinds of engineers that work at AWS/GCP? If not, cloud is the safer route. Cost does matter, and this is why companies sign multi year contracts to get discounts. But business continuity is critical.
But if you need a server then (in most companies big and small) it's far easier to spin up a VPS in the cloud than deal with internal IT.
> "I didn't state that cost is the same thing as value?"
You're arguing over cost, but the cloud is often much greater value compared to traditional IT. Spending 2x for 5x more value is a valid decision. If it doesn't work in your situation then don't do it, but it's not the same answer for everyone.
Money is COMPLICATED and THE issue.
Money is complicated because you have income and expenses. Time to market and velocity can help you get more income. This needs to be balanced by expenses.
When you're growing or your needs are uncertain than a hyperscaler can help you get moving quickly. This aids in time to market. But, you do this at a cost. Hyperscalers cost more than running it all yourself.
If your workloads are steady state or changing at a predictable rate than it can be cost effective to run your own infrastructure.
There are other elements to all of this such as global location of hardware compared compared to end users.
Money is the issue because companies are in business to make money. Sometimes companies take a loss now in order to make money later but it's always about the money.
You're painting the picture as if AWS is the 2nd version of the IBM saying: "No one ever got fired for using AWS". This is simply not true...at least not the part where "IBM" (i.e. AWS now) is somehow inferior to the competition.
> If you are large enough to need to build your own datacenter instead of renting floorspace for pennies on the dollar from Switch or Equinix (although Equinix is kind of pricey) or Windstream or insert provider - then the datacenter is a rounding error in your 10-year IT budget.
Then you clearly don't understand the TCO of using a data center vs cloud. The datacenter cost itself isn't the cost - the people who operate it are.
On a computing resource basis can you operate SQL Server on a rack in Equinix for cheaper than that in AWS? Sure, but who is going to pay for the person to patch it every week, or upgrade it to the latest version, or upgrade the SAN disk, or upgrade the hardware every 3 years, etc. etc. Let's take this a step further - who is going to hire these people? And fire them? And train them? These are all transactions costs that get hidden in the "$0.20/hr cost" of spinning up an EC2 instance.
If you think cloud computing it's just about a lift and shift from a traditional data center, then you don't understand how to calculate TCO.
P.S. - For the record, many large internal IT groups do in fact do simple lift and shifts from traditional data centers and don't fully realize the value of cloud computing resources. However, these companies will usually mature eventually and evolve services to ones that are more advantageous (i.e. setup SQL Server on EC2 and the migrate to RDS). AWS (et al) have the ability to do this with ease.
Who cares? This is IT and is not relevant. And they have Brent and he will solve everything.
Sure, but you can go from "I have 5 people managing my 150 instances of SQL Server" to "I have 1 AWS sys admin". The point wasn't that the costs are eliminated, it's that they are baked in.
I think Cloud still costs more overall, never been convinced it actually saves money. I do think it tends to increase developer velocity though, and that can be worth it.
This is especially true for more than basic services. If all you need is a bunch of Linux servers, sure, you can find people who will keep them patched for you without too much trouble (although it'll almost certainly turn that “rounding error” into a serious number) but once you start building things which are higher level with legitimately hard problems to solve and need to have good solutions for all of the monitoring, security, ops, etc. needs that staffing becomes harder and you're going to have to sell your executives on the idea that the best use of your expensive A-team is cloning S3, Lambda, etc. when you can get that benefit immediately without a massive up-front payment and have the same people working on a strategic benefit.
No need to clone; all of this already exists. Take a look at CNCF.
* Kubernetes
* High-level storage services: Ceph, Cassandra, NFS
* Lower-level storage for whatever you pick for the previous point
Each of those, and the combined service you build, needs staffing for operations, monitoring, security, etc. support. If you follow any security standards or are in a regulated industry, you're on the hook for documenting compliance on all of those, too, especially if you need to be able to demonstrate things like immutability.
You certainly can do this but that's a number of full-time jobs requiring expertise. If you have enough storage usage you can potentially justify the savings over the rates you'd be able to negotiate but that's a big up-front cost which you hope but are not guaranteed to recoup.
I took your previous comment to be about on-prem cloud technology. It exists and does not need to be "cloned". If you were taking about staffing resources, we've pretty well established you're going to need staffing to manage both cloud and on-prem tech.
You need to document whether it's on-prem or in the cloud.
If you buy storage by the petabyte or use a large enough amount of network egress, you can definitely make that money back but it's a major commitment.
Agree, I don't think anyone is buying SANs that don't need them. If you're spending 7 figures on your AWS bill, you should be looking into other options.
That is building an S3 replacement. You aren't writing every line of code personally but you are selecting components, configuring them, operating the service, and testing it, which is a major commitment. Simply running k8s at an equivalent level is a non-trivial commitment.
> Agree, I don't think anyone is buying SANs that don't need them. If you're spending 7 figures on your AWS bill, you should be looking into other options.
Note that the 7 figure commitment I mentioned was what you'd need to build an S3 equivalent. Simply having 24x7 staffing and hardware easily puts you in that range.
You're casting this as a much more complicated concept than it is. It is essentially the same old "build vs buy" argument. No, it does not make sense to manage a datacenter to run a single wordpress blog, nor does it make sense for a telco to run their infra on top of a public cloud. These are all truisms.
My point stands that if you have a seven-figure AWS bill, you already have plenty of associated staffing costs. Once you hit the break-even point between the two, you can decide whether you want to continue to pay linearly, or go down the path of increasing RoI.
I've seen this "even a lift-and-shift reduces TCO" argument before, but it only ever works if you pretend that AWS lives up to its zero-management hype. Maybe, for someone, it does. Not for any deployment I've seen. This never prevents management from pretending, of course.
EDIT: ah, I've seen that the argument has retreated to "it reduces IT headcount." Again, maybe for someone, but I have yet to see it actually work, and every time management has just hustled the TCO calculation.
Who is saying zero-management? If you have a consultant lying to you, that's not a cloud problem and I've heard the same people lie about all kinds of on-premise services as well.
What I've heard the major cloud providers say is true: you need _less_ staff and you can spend time on different things, which has been generally true. For example, instead of needing to configure a bunch of network hardware (which is a distinct skill you need to hire) you can have a general devops person use Terraform to manage routes, firewall rules, etc. without also needing to be a Cisco expert and spending time operating the underlying hardware.
The key question to ask is where your infrastructure was to start with. If you have an A-grade ops team, a lift-and-shift will probably not be much of a cost savings because you presumably already have economies of scale working in your favor, unless you have enough bursty workloads to pay for it that way. The catch is that most places do not have that high-end ops capacity so what you're really doing is taking your limited IT capacity and reclaiming the time which is currently going into things like managing Dell firmware updates.
You're implicitly arguing that NoOps is not only a functional model, but also scalable and much less costly than having a {Dev|Sec}Ops staff. The last time this was publicly debated between Adrian Cockcroft and John Allspaw, it was immediately obvious to everyone that there is no such thing as NoOps. You can have developers support their own apps in production on the cloud, but that takes away time from developers and comes with its own set of downsides (most prominently, a disinterest in what they consider mundane or boring). Once your developers are spending, in aggregate, more than 40 hours a week do ops work, you'll gain efficiency by hiring a DevOps Engineer whose entire career focus is all the things developers aren't typically great at. I've seen this in-person as an employee at medium, large, and a Fortune 50 business. I haven't yet seen a single app, not even serverless, that requires zero maintenance. I have also seen highly-distributed, performant apps run on cheap hardware with no SAN or VMware to drive up the cost and complexity. That same app, made up of mostly microservices, was much more expensive to run on on the cloud.
You might want to stop throwing around terms like TCO when you also clearly don't understand how to calculate it.
I'm starting to be of the mindset that us-east-1 is already "Too Big To Fail". I guarantee you that conversations are being had in boardrooms right now about how to reduce dependency on that region, if not AWS entirely.
I'm not. You implied too much.
> You might want to stop throwing around terms like TCO when you also clearly don't understand how to calculate it.
I do. I never said that people were completely eliminated (see one of my child comments). Everything you implied was that "well devs are doing the effort and that doesn't get calculated". That wasn't my argument - you just added that nuance as a retort.
> I guarantee you that conversations are being had in boardrooms right now about how to reduce dependency on that region, if not AWS entirely.
I guarantee you they are not. Also, how many data center providers let you simply spin up your whole environment into another region, point n click, and complete it in hours?
Source - work with 100+ companies with PE folks that sit on boards.
I'm speaking from firsthand knowledge. How embarrassing for you to think that because you know some Private Equity folks (generally the worst people at managing technology), that 100% of the rest of the world is doing (or not doing) exactly what they're doing.
You wrote paragraphs about how expensive it is to hire people to do stuff in a datacenter. What is your argument, if it is not that this is more costly than outsourcing it?
This entire debate should be recast the simple "build vs buy" concept that it already is.
So am I. My reference to PE firms was that my anecdote of the few boards I'm on is supplemented by their experience.
> This entire debate should be recast the simple "build vs buy" concept that it already is.
Because that's entirely the premise of my argument. Did you read the parent comment and what I was responding to?
PS - Say what you want about PE folk, but they are the most ruthless capitalists. So IMHO they are far more incentivized to drive cost efficiencies than anyone else because profit = EBITDA = valuations.
If you're not blasting your AWS account manager and asking what their plans are to avoid this happening in the future, then your CTO is not doing their job.
If AWS itself is not internally working out how to "get off us-east-1" for its global services, then it is failing in its role as infra provider.
AWS has a lot of stuff about how to make your infra redundant and resilient to failure, in their environment, mostly about replicating across AZs and then across regions.
The fact that their "global" services are not actually "global" but are "everything goes to us-east-1" is broken and if they're not fixing it, then that is when you start looking at other alternatives.
I guess I find that a bit humorous. I've been architecting solutions that span on-premises and cloud for nearly a decade so I'm intimately familiar with both. I don't actually have a horse in the race. You want cloud, buy cloud, you want on-prem, buy on-prem. But the marketing about one-size-fits-all is EXTREMELY tiresome. And the idea that every single business can or should be moving their entire infrastructure to the cloud is as well.
The fact you imply that somehow you don't need people to manage the cloud makes me seriously question what at-scale deployments you've been a part of. I have yet to see a single enterprise customer save money on staff by moving to the cloud. More often than not what they end up doing is laying off the "tape jockey" and replacing him with an SRE who costs 3x the salary. Congratulations? Now you're paying more for an SRE, and you're backing up to S3 at about 5x the cost of what you were spending on tape? But I guess the 7 years of backups you're legally obligated to keep are more agile?
>If you think cloud computing it's just about a lift and shift from a traditional data center, then you don't understand how to calculate TCO.
I don't think the concept of cloud computing is lift and shift and never said it was. But that's not really relevant to OP's question, what is relevant is what's happening on the ground.
What's actually happening is that most established businesses "moving to the cloud" are lifting and shifting and finding out the hard way. I'm not saying that's what they should do, I'm not saying that's at all a good idea, I'm telling you that is what is happening. And if you think "well they'll mature into a more cloud friendly model" - you're as delusional as their management. What ACTUALLY happens is after they lift and shift and get a year's worth of those bills, they lift and shift the stuff that never should've been in the cloud in the first place back on-premises. Hopefully by that point they've learned their lesson and have a thoughtful evaluation of their applications: re-home, re-write, leave in place.
100% agree. Didn't mean to imply this. As with anything....it depends.
Most data center machines run at a tiny fraction of their capabilities; seeing a CPU running at 25% is definitely something that stands out. Because of this, cloud operators can oversubscribe these machines in various ways, packing workloads of multiple tenants onto a single box while a single-tenant bespoke DC can't. They can also do things that schedule DC-wide resources (namely power) in ways that renting space in a colo cannot; they can shed load in insightful ways when a power overtopping event happens that can minimize the impact (e.g. throttle / nuke VMs that can operate in a degraded mode before impacting other critical services). No hetergeneous, multiple-private tenant DC is going to oversubscribe their rack- or row-level power delivery to tenants and require them to hook in to a smart system to manage overtopping events; they just won't trust their tenants to do the right thing, as they have no power over the tenants' machines and power draws; the cloud providers do.
At the end of the day, the economies of scale are just hard to beat, in terms of COGS.
The real question is whether they'll pass the savings from this on to the customers or the shareholders' dividends, and so far it seems like it is the latter.
Are you familiar with VMware?
Kubernetes fixes that, as does VMware. They can both distribute workloads efficiently to ensure good utilization. VMware has done that for 20 years.
Another thing is costs of building something new. In the old world it would mean doing the math on resource needs now and in the future, since adding Hw meant capital expenditure. No such problem now and its easier to get started, see if it works, and scale or kill early.
And of course as others have mentioned, keeping it all running requires expensive expertise. Esp. now with the internet that looks like automated wild west. You cant release a service without it being auto-probed and auto-attacked within 2-3hrs.
Nope. With the cloud, the costs have went down for any large coMpany, even those that just moved the old crap to VMs running on someone elses hw.
Are you implying that there isn't idle cloud hardware?
I think I found your problem...
Compute on preemptable VMs/spot instances is cheaper in cloud.
Object storage, if you would have required a vendor support contract on prem, up to a PB or so.
managed kubernetes, if you would have required a vendor support contract on prem.
I entirely associate fantasy football with working hours. Ditto a variety of other kinds of sports betting. Like, I know people do these at home, too, but there's a lot of it happening during business hours, at offices.
I know there are also a bunch of requirements for where you can store user data these days due to privacy regulations.
Agility, flexibility, security, global deployments, and consolidated billing and operations are far more important.
But the others are spot on.
Going into the cloud does not alleviate any security decision. You can't buy security.
Of course you can. In this case, many of those decisions are already made for you in the cloud.
A simple example would be using RDS for a database service. It's secure by default and only the credentials are an issue, compared to running a database of your own somewhere internally that may be exposed in dozens of ways. Less decisions, less surface area, more documented reference setups to follow, more scanning and analysis tools means better overall security posture with less work.
It would have been much, much cheaper to rent gpu in the cloud and when we knew _something_ about our workload we could buy an on prem and maybe rent extra if needed.
But we weren’t cleared for cloud.
Regarding in-house expertise: I think most companies would like to have in house expertise but they can’t hire the expertise they need so they use consultants.
However... I was also sort of surprised, because last time I priced this out, you can have pretty low utilization rates of the equipment and still come out ahead.
Don't expect these ratios to be authoritative; there are obviously different economies of scale and many many details I papered over, but this should just give you an idea of the back of the envelope "relative costs"; just that 5x is way out of the range you should have guessed.
Mostly because they simply didn't know how to run an IT office, and so they couldn't build a culture where good IT people want to work. When they finally get a strong candidate, they end up overloading the poor hire, because finally, it looks like they can get their infrastructure fixed or dream project off the ground.
I used to work at one of the most popular fast food chains. I had one project that was internal to them and one that was customer facing. The internal product, a search engine for documentation ran on-prem while the e-commerce store ran on AWS. Running the former on-prem was just fine.
I'm sure glad we were on AWS for the customer-facing site, though. We'd run ads during the Macy's day parade, college national championship, etc... dear lord I could not imagine wrangling the necessary people to scale that out from an infrastructure perspective. It was very nice just doubling the number on our ASG, failing over to the secondary database, launching another DB instance with double the capacity, and repeating for the second one.
Between those popular ads and DDoS attacks I'd say AWS was a win there, but internal tools don't benefit from the cloud as much. Also not an MBA, but I feel like that's a rule a thumb you can add to the repertoire.
https://www.businessinsider.com/bank-of-americas-350-million...
It seems no company wants to be in the business of in house IT Systems. They think moving all their infra into the Cloud absolves them of all the responsibility of owning it themselves, they don't give a shit how much it costs but then tell you everyone has got to save money and tighten their belts.
I've done this: built a 17 server cluster, housed in a colo, for a high compute startup producing 3D avatars from photos automatically. The hardware for the cluster, including a Federal Reserve class hardware firewall, was just over $50K, with a month to month colo bill of $600. This was in contrast to $96K per month if the same configuration were at AWS. This was 7 years ago, so adjust the prices, but you get the exponential higher expense point.
A private network is ridiculously easy to set up. In our case, we had two switches, one public, one private. Every machine had 4 NICs. Just bind some to public addresses, some to private, plug in to appropriate switch.
Unless your traffic is extremely bursty, auto scaling is probably more trouble than it’s worth. We were serving millions of users with three dual-socket machines. And if you really need it, you can try to handle base load with dedicated servers, and bursts with AWS infra. But at <$10k/mo on AWS, you’re not getting anywhere near the horsepower I’m talking about.
I understand it was a startup and may not have needed high-uptime ops from day 1, but a lot of organizations do, and the cost is not that dissimilar.
You also have to include the human time spent setting up and maintaining those servers. And also the fact that you can probably use a managed service on request instead of 17 servers running constantly. Not even mentioning redundancy.
Most businesses are not technology businesses, they deliver goods or services to their customers where IT is part of their costs to deliver.
Investing in IT people to run that bare metal is a huge expense that doesn't improve your goods or services directly.
As for "where a task would floor 32 cores for 3.5 seconds"... means that your internal IT infra had to support that maximum requirement headroom 100% of the time, even though it may not be used for 99% of the time (depending on load patterns etc).
Enterprises would rather not maintain inhouse infrastructure for many of the same reasons they engage MSPs despite persistently shoddy services.
I will say that if your work load is relatively fixed in magnitude and especially if it's bandwidth intensive, you can probably beat the "big cloud" providers by at least an order of magnitude. If it's extremely bandwidth intensive you should never consider mainstream cloud as outbound bandwidth is absurdly overpriced... like 1000% markup or even more. I can't exaggerate how insane bandwidth pricing is.
If you are just prototyping something, your work load is highly elastic, or your product is rapidly evolving, the flexibility and outsourced sysadmin of cloud will probably make sense.
Edit:
There are edge cases too. If your work load is, say, inbound bandwidth and storage intensive, AWS might be great since S3 is cheap and inbound bandwidth is free. Just keep in mind that you might pay a lot for egress if you ever need that data out. Will you?
Run your own numbers and be detailed!
Building up an IT infrastructure that can provide services at roughly the same quality and cost as AWS takes a large investment in talent and infrastructure. And many companies don't see the value in making that huge upfront investment for something they might not need. Better to start with AWS, and once you get to the point where you can lower your costs by 50-70%, then start looking at moving in house.
no, you missed an important point here.. no one, at any scale, has been able to compete directly with AWS on the combination of service, scale and cost per unit.. its intensely competitive
It was quaint, adorable, personal, and hilariously inefficient.
It seems very clear to me that these kinds of businesses are much better served by cloud. No one of them is that valuable of a customer, but there are so many.
Companies that are large enough to have an IT department with multiple highly skilled professionals onsite, or who could even contemplate doing a real data center (most "on prem" is in a closet), I agree is a different calculation.
To operate a production cloud you need expertise at all parts of the stack. This includes network, kernel, maybe firmware, orchestration, etc. You also need adequate planning where your on-prem data center teams continuously upgrade your hardware/firmware and add capacity. From an organizational perspective this is an entire VP or SVP level organization depending on where you are.
Operating large infrastructure is hard. If it’s not your core competency there is really no point in dealing with it. Either way, it takes enormous effort to hire and keep a team skilled to operate infrastructure. You will lose your team to big-tech eventually.
You don’t need external consultants to manage your cloud infrastructure. Your existing engineers can skill up to use it. Public cloud will commoditize what typically takes a lot of time to plan for capacity, DNS, networking, scaling, etc.
In short - its prioritizing speed of execution over everything else. The opaque billing is just cost of doing business. But unless tech is your core competency, opaque billing is much easier to deal with than all the other situations that come up with managing and maintaining your own infrastructure.
The question for businesses comes down to economics, of capital expenditure vs operating expenditure. If I buy my own hardware, I have to spend capital and depreciate it as part of the operating expenses. If I lease hardware (whether on prem or cloud), then that's pure operating expense.
There are accounting and tax implications. There's also the "stick to your knitting" of a business. Do I need my own payroll service, or do I outsource it. Do I need my own accounting, or do I outsource it. Do I need my own cleaning service...
Solution: Subscribe to a middle-man that manages it for you.
Problem: The middle-man is slowly turning the screws to increase its profits.
Solution: Subscribe to another middle-man to figure out how to decrease the first middle-man's profits.
It seems to be a universal truth that computing people try to solve all problems with another level of indirection.
For most, this was never the effective reason.
Most rationales behind cloud migrations are likely based on quick scaling, which is meaningless in most cases - except for the signalling of committing to a future where demand hockey-sticks upwards.
It's valid if you are netflix, but how many netflixes exist in the world?
This isn’t about computing but about specialization. Should McDonalds be in the business of operating Data Centers? Or should they just buy it from those who do it best and focus on selling food?
Should they be in the business of cleaning bathrooms, or should they just outsource that to a temp agency? Sometimes specialization pays, and sometimes it doesn't. Perhaps it doesn't make sense for McDonalds to run its own web and corporate servers, but doing so might make a lot of sense for more tech-centered companies. And I'd guess a server farm is miniscule compared to the size and complexity of their ingredient supply chains.
https://www.zdnet.com/article/why-does-the-it-industry-conti...
https://www.horsesforsources.com/gartner_fail_automation-AI_...
The Gartner reports were complete and utter garbage, filled with factual errors. Looks like they were written by interns, regurgitating marketing material - completely removed from reality.
Since then, whenever I see somebody mention a Gartner report, I immediately dismiss that part of the argument.
> The second report ("1999 OS forecast: The Linux face-off") projects market share in server dollars for the next few years. This one even contains a pretty graphic. The Gartner Group finding is that Linux will fade from the scene following the release of the first service pack for Windows 2000.
> The third report ("Red Hat's future: Boxed in") concludes that Red Hat will fail to overthrow Microsoft by 2004, and suggests that Red Hat needs to find a more viable business model.
If you get a report from them on how the pitfals of setting Oracle's Spatial, it's probably good. If you get a cost benefit comparison of Oracle and Postgres, it's certainly trash. (Who am I kidding? They still insist Postgres doesn't exist.)
That said, none of the documents are worth the price you pay and the hassle of interacting with them.
Basically analysts mash up what vendors and customers tell them what they think. They have conferences with large enterprise customers and vendors sponsor those conferences. So there’s a element of indirect pay to play. Many companies use them to review contracts as well, so they know what kinds of deals are out there.
If you expect to understand technology from Gartner reports, that is dumb. But if you want to understand the market and offerings for large commercial/gov enterprise customers, they are a great resource. If you are a startup, you should not pay any attention to Gartner unless you are selling in that space.
In the case of this topic, the information that’s key to understand is that Gartner is getting feedback that their customers are adopting cloud services, but are seeking to optimize the spending, including with some of the smaller players in niche areas.
They are pretty shitty for that too. They only get anything passable if you are after the offerings of the specific companies that pay them for the publicity.
You can do nearly everything "the computing cloud" offers without it : just use servers, install your services on it, manage it, invest in more servers/ more powerfull servers if needed... Cloud computing is not a brand new invention, it's just delegating the server and services management to others... Whereas, a century ago, electricity was actually an essential input.
Then I can imagine SAAS companies offering discounts if your API requests originate from AWS cloud.
Maybe even Amazon prime members will get free bandwidth from their home internet connections into and out of AWS.
At some point, the whole lot becomes a walled garden, and being outside it is more expensive if you need to use services that are inside.
Although this idea makes practical sense, from a financial standpoint I don't think there will be enough incentive.
Bandwidth savings in infra will represent <1% savings relative to the SaaS/API price.
... and have the staff with experience and resources to keep them running. These days, UPS maintenance is sourced out to the cheapest bidder and testing is infrequent, with the predictable result of shit hitting the fan at the exactly worst time.
It’s outsourcing the blame. This is the key to boardroom success. When something goes wrong in their own data centers, the CXOs need to shoulder the blame.
Large corporations outsource everything, including the guy who cleans the copiers, copier not working, blame the maintenance vendor.
Something went awry with the infrastructure, blame AWS
App development project went down the tubes? blame the contractors & outsourcing companies.
The Cxo comes out blameless each time
the problem with applying this concept here is the hyperscalers are not exactly a counterparty likely to underprice IT risks. in any case is there any public evidence of this "blame transfer" in action (pressumably with associated remedies)
Uh, they charge more per byte, that's not what's going on. I don't know if that was AWS's Garman being deliberately misleading, or the Economist journalist misunderstanding.
Ready for testing and pre-release R&D.
I was on the development team for a couple years; now, I'm independently developing some technology on the platform. I'll announce it soon, I hope.
With the recent AWS outages, and systematic de-platforming of some legal businesses, there seems to be a growing realization that dependence on centralized hosting platforms is ... dangerous.
Holo / Holochain seems to provide a unique solution to some of these problems.
Why not "own" AWS, GCP, Azure etc.? Because you can't. They are part of conglomerates that come with a moral baggage that is too heavy for some.
ps. No "hyperscaling" ability required. The idea that business activity is either complete dominance or death is part of that unfit-for-purpose mentality.
The key challenges in this space are standardization of commodity features, making the whole business of using any of these solutions less complex, and driving cost down. This goes against how the big three are making of course which is exactly through vendor locking aggravated by complexity. Once you figure out how to use this stuff, you have a lot of non portable stuff depending on that vendor. Replacing that costs money and is never a priority. That's why AWS stuff can be such a PITA to deal with. It actually ensures customers can't move away that easily.
However, the common feature set shared by most of these cloud hosting solutions (running vms, databases, docker, load balancers, networking, etc.) is a combination of expensive to use and still too hard to manage. So, the game for new players in the market is being more convenient and less expensive to use. Ultimately private cloud and the cost of getting started as a PAAS provider getting lower means that this is a race to the bottom. Most of the smaller providers already lean heavily on OSS solutions.
The question is whether the big three can long term afford to not support the emerging standard stuff. For example at least for me all the convoluted proprietary AWS stuff is actually increasingly a reason for me to avoid depending on them. It was great when they were the only company with decent solutions but that is increasingly less true.
It shouldn't be called a "cloud" in that case. It should be called a "fog".
Yes if you only use compute and storage moving is easy.
If you want scaling in AWS then move to Azure I think that would involve a lot of changes (as it would the other way) I am not sure how much of it Terraform can translate.
I would guess K8 can do this is a vendor neutral way but I am not sure since I have never worked with it.
I do know for a fact that getting your devops pipeline set up in AWS is really complicated. We ended up having to hire two "elite" AWS consultants for 14 days to get it all working. I was not involved directly in it, but my team had great need of the finished pipeline. If we went with Azure we would have to do it all over again. But most of our stuff is in .Net so getting it all working o Azure would have been magnitudes better.
The more "premium"/ high level services one starts using the ability to move on prem or switch cloud becomes harder and harder. Which is of course the goal for the cloud vendors.
I have been in companies doing both.
It is my experience that it is a lot easier on Azure than AWS. (At least as AWS was 2 years ago and Azure one year ago).
what does this mean
requests != bandwidth. are they paying a penny per request?! that's a lot. or is their website several gigabytes? or are indian CDNs expensive?
highly suspicious of economic news service that doesn't understand the numbers it prints
That seems like a common subset that would satisfy a lot of use cases with minimal ceremony.
I think, a VM approach would have been a bit more flexible.
How do you even begin to operate a consistent security model across "8.4 million global data centers"?
> Auditors on the Akash Network review cloud providers and digitally sign the provider on-chain with their certificate. If you only accept bids from audited providers this means you are trusting the Auditor/Provider not just a Provider. [1]
For a business at scale, I don't see this being solid contractual ground. Now I have to trust Auditors to continuously vet Providers? Simply too tenuous for my comfort.
Major vendors like Amazon and Google are happy to provide this to anyone and with simple on-boarding, but, as is clear in the article, it's expensive. With Unikraft[0], you can completely re-package your application as a unikernel, automatically. It's a single VM image and does nothing more than just running the application. It boots straight to the main application, it doesn't have a shell, and has nothing else running along side it. The result is a huge cost saving (up to 50%), since you're no longer having to pay for these extra resources just to run the a full traditional OS image plus your application.
[0]: https://unikraft.io
Those sort of numbers without even having a pricing page give me 0 confidence sorry.
One example of recieving a 50% cost saving is from Amazon Machine Images (AMIs). We compared the cheapest official NGINX AMI available on the Amazon Marketplace[0] and then also ran an NGINX+Unikraft AMI. We ran the same workload using wrk[1] and then checked the bill at the end of the month, roughly $80 vs $40.
[0]: https://aws.amazon.com/marketplace/pp/prodview-xogyq23b3mfge
Most of the costs for using the NGINX AMI + t2.nano come from software (0.29/hr), not EC2 (0.006/hr).
That's like the worst instance you could pick to prove anything about the performance of your platform. At most you're telling me your AMI costs half of NGINX's... Which still is a lot more than just running Ubuntu with a free AMI.
There must be a pressure by competition to keep this incentive in check.