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To answer your question, people get discounts just for negotiating, no PR required. I would guess the conversation went something like this: "___ is how much we
by noahl 9y ago
To answer your question, people get discounts just for negotiating, no PR required. I would guess the conversation went something like this: "___ is how much we pay to host Etsy on bare metal right now. Can you match that?" "Yes."
I'm oversimplifying - there are a bunch of other considerations, like guarantees about future prices and capacity availability and whether having more flexibility makes it worthwhile for Etsy to pay more, but fundamentally Etsy looked at their current costs and asked Google to make an offer. (I would assume they actually had all three major players bid, and Google won.)
Also to your point, the announcement specifically called out Google's AI and big data capabilities. Those are workloads that can involve a lot of bursting, so the cloud might be especially attractive. Imagine trying to implement BigQuery in bare metal - you can do it, but you have to have a lot of extra servers lying around just in case someone tries to run an analytics query. The same goes even more strongly for something like a model training workload. For bursty enough workloads, running in the cloud can be cheaper than bare metal even given the cloud provider's profit margin.
Depending on how much model training Etsy wants to do, something like TPUs might have also given Google a fundamental edge in costs over bare metal or other providers. I don't know enough to know exactly what factors went into Etsy's decision, but I think these are reasonable ideas.
- gesman 9y agoI not sure about them asking AWS to bid as they'd see AMZN in a "conflict of interest" online ecommerce space.
- alpha_squared 9y agoAs far as I know, which is very little generally, AWS doesn't bid. Prices are as advertised. Not sure if GCP is similar. Azure certainly does, though.
- jimmywanger 9y agoI know for a fact that AWS that AWS negotiates. My buddy used to work at Netflix and he told me that they got a really good rate for AWS that was not available to the general public. They might not bid in the strictest sense of the word, but when the vendors are mostly 3 players (Google, Amazon, and Microsoft) you just ask each one for a quote. I don't see how functionally that is different from bidding. Btw, I know there are other hosting providers out there (Rackspace comes to mind). I can't think of any one of them that would be able to deal with Netflix scale without shitting the bed, missing features, or an almost unacceptable lead time as they build out infrastructure.
- cobookman 9y agoall the cloud vendors can offer holistic commits to give lower than list price. We're talking anywhere from X-XX% discount on a per service level. Generally you need to have a certain amount of usage before companies will engage these discussions.
- ckorhonen 9y agoIf you are looking to be acquired by someone like Walmart the you might as well build your infrastructure on GCP/Azure now!
- foobarbazetc 9y agoOkay, that makes a lot of sense. If Google told me they’d match my pricing then sure, I’d probably look at doing that too. Still a lot of issues on GCP for low latency DB deployments though (no permanent NVME, higher latency on the network backed block storage, etc). Presumably you start looking at Spanner but that’s it’s own world of hurt (higher latency than MySQL/Postgres, a reeaaallyy basic query planner, the list goes on). You have to change the way you think about data with it and pretty much re-architect your data access. Agreed re machine learning etc.