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Furthermore, this is an operational expense as opposed to a capital expense, which is a bit nicer on the books. Something about this seems broken. Why would it
by Zak 17y ago
Furthermore, this is an operational expense as opposed to a capital expense, which is a bit nicer on the books.
Something about this seems broken. Why would it be inherently "nicer" to spend money on a service as you use it than on a product that you get to keep?
- wrs 17y agoBecause we're talking about a business. Capital expenses must be written off as depreciation over time. Operational expenses can be written off immediately. For tax reasons this can be a big deal. However, you can buy servers through a leasing company to get this benefit; you don't have to use EC2.
- andrewf 17y agoAnother example of this insanity: http://www.joelonsoftware.com/items/2007/04/13.html http://www.joelonsoftware.com/items/2007/04/13.html (Cube farms aren't necessarily cheaper than nice permanent construction, but you have to amortise tax deductions on the latter over 39 years).