> It costs a lot of money to pay people to figure what hardware to buy, install servers, networking gear, maintain it, pay for bandwidth, backup etc. > Then of

> It costs a lot of money to pay people to figure what hardware to buy, install servers, networking gear, maintain it, pay for bandwidth, backup etc. > Then of course there are the financing aspects: you don't pay for expensive servers up front, you 'lease' them effectively - which has serious working capital benefits. There are solutions other than cloud and going to the extreme of owning servers, switches, maintenance, bandwidth and space in a datacenter. OVH (an example due to my familiarity) will sell you a dedicated server with 2 x E5 2650v3, 256GB of RAM, 4TB of disk and 500Mbit guaranteed bandwidth (1Gbps burst) for $269/mo. This includes most of the annoying stuff, like replacing failed components, dealing with network issues and such. The bandwidth, conveniently, is also not limited aside from the speed you're given. You can use 500Mbit/s for every second of a month if you want. That's 164TB. The cost of a n1-highmem-32, which is the closest alternative I could find on GCE is $1030/mo, plus disk ($348/mo for 2TB), plus bandwidth (164TB is $13k from Google). Also, the cost of owning and running your own hardware isn't necessarily expensive, particularly if you're small. When you're running a fleet of thousands, yes, you definitely want dedicated people for that. When you can fit all your infrastructure in a single rack, it's not much trouble to call up Dell and ask for a quote, install it in a local DC then forget about it. Most DCs give you "remote" or "smart" hands that can do basic maintenance like swapping a failed HDD for low or no cost. Dedicated/colocation aren't for everyone but they're certainly not as scary as some people around here seem to think. And in terms of cost, I daresay that if you're doing anything bandwidth heavy, the cloud is near-certainly costing you insane amounts of money. You can get decent gigabit transit (~300TB/mo) these days for $400/mo while Google, Amazon etc. charge in the thousands for that kind of traffic.