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Is Netflix at the top end of some curve? My understanding of moving from cloud -> datacenter is, you know, there is some line where it's cheaper to just lease y

Is Netflix at the top end of some curve? My understanding of moving from cloud -> datacenter is, you know, there is some line where it's cheaper to just lease your hardware than pay for cloud infrastructure. At that size you tend to have DBAs, dedicated infrastructure people, etc., to make scaling up go. But now has Netflix come through that line where the cost savings is outweighed by the uptime/availability etc.?

phamilton 11y ago
Netflix doesn't pay what you or I would pay. Netflix is at a point in their AWS usage where Amazon calls them to help track down AWS bugs.
fleitz 11y ago
Netflix has hugely 'spikey' load across the globe, AWS is perfect for that use case. They need to spike for prime time and then don't really need much infrastructure.
throwaway_exer 11y ago
Netflix tried operating their own DCs, and weren't good enough at it. Hence the move to the cloud. They do have discounted pricing, and they get the agility to add a new region overnite.
jedberg 11y ago
It's important to keep this in mind: For most companies, their infrastructure is the second largest expense after their employees. For Netflix, the cost of both pales in comparison to the content licensing (which in 2016 they have said is 6 billion). Cost isn't a huge concern, agility is far more important. That being said, the all in cost for Netflix on AWS is still cheaper than trying to run nine datacenters around the world, which is what they would have to do to replace their usage of AWS.
easytiger 11y ago
It would be beneficial for amazon to sell their services at 50% off to take netflix out of the game of running the DC themselves for the next 15 years
- vidarh 11y ago
  Much, much less. If you spend more than a couple of millions a year on AWS you're being robbed if you haven't negotiated a much steeper discount than 50%. I happen to know of companies paying ~25% of published AWS prices. Especially on bandwidth, the published AWS prices are almost criminal - I'd be surprised if Netflix pays even 10% of published prices.
ownagefool 11y ago
Often the calculations of managing your own hardware is pretty naive. Folks are correct that they can hire a couple of infrastructure folks to build out a single datacentre, but often there datacentres aren't as big nor as resilient as what they'd get from AWS, at least not at the scale where the luck factor starts to fall to statistics.

phamilton 11y ago

Netflix doesn't pay what you or I would pay. Netflix is at a point in their AWS usage where Amazon calls them to help track down AWS bugs.

fleitz 11y ago

Netflix has hugely 'spikey' load across the globe, AWS is perfect for that use case. They need to spike for prime time and then don't really need much infrastructure.

throwaway_exer 11y ago

Netflix tried operating their own DCs, and weren't good enough at it. Hence the move to the cloud. They do have discounted pricing, and they get the agility to add a new region overnite.

jedberg 11y ago

It's important to keep this in mind: For most companies, their infrastructure is the second largest expense after their employees. For Netflix, the cost of both pales in comparison to the content licensing (which in 2016 they have said is 6 billion). Cost isn't a huge concern, agility is far more important. That being said, the all in cost for Netflix on AWS is still cheaper than trying to run nine datacenters around the world, which is what they would have to do to replace their usage of AWS.

easytiger 11y ago

It would be beneficial for amazon to sell their services at 50% off to take netflix out of the game of running the DC themselves for the next 15 years

vidarh 11y ago
Much, much less. If you spend more than a couple of millions a year on AWS you're being robbed if you haven't negotiated a much steeper discount than 50%. I happen to know of companies paying ~25% of published AWS prices. Especially on bandwidth, the published AWS prices are almost criminal - I'd be surprised if Netflix pays even 10% of published prices.

ownagefool 11y ago

Often the calculations of managing your own hardware is pretty naive. Folks are correct that they can hire a couple of infrastructure folks to build out a single datacentre, but often there datacentres aren't as big nor as resilient as what they'd get from AWS, at least not at the scale where the luck factor starts to fall to statistics.