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Disclaimer: I work at Backblaze. > dirty secret for the big 3 cloud providers. Their egress charges have huge margins. I don't know about the other providers,

Disclaimer: I work at Backblaze. > dirty secret for the big 3 cloud providers. Their egress charges have huge margins. I don't know about the other providers, but Backblaze buys bandwidth at about 2/10ths of 1 cent per GByte right now, and it drops by maybe 10% per year. We look around hard for inexpensive bandwidth, and then make sure we always have redundant network providers and redundant paths. That's all blended into the 2/10ths of 1 cent per GByte cost basis. Part of this is complicated by any "spikiness" in network traffic. Network providers sell bandwidth based on things like "95% of peak traffic". So the 2/10ths of 1 cent per GByte is based on an assumption that overall the outbound traffic is perfectly flat. It would be more expensive to Backblaze if "most days" the outbound traffic was 200 Gbits/sec but once every 7 days it spiked to 400 Gbits/sec for 25 hours then dropped again. In that case Backblaze is hit with a bill for 400 Gbits/sec sustained for the entire billing period (a month), but customers did not use it up in a "flat" fashion so it eats into our margin. Luckily, since Backblaze supports hundreds of thousands of different individual customers, it appears mostly "flat" to us in aggregate. The five week days tend to be about 10% higher network use than the weekends, but other than that it is all super flat and regular (so far).

tyingq 9y ago
Yes, I wasn't talking about your $0.01/GB egress charges. Amazon, for example, starts at $0.15/GB. It drops down with more volume, but it's obviously gouging to a ridiculous level.
- brianwski 9y ago
  > Amazon starts at $0.15/GB and drops with more volume. Which has ALWAYS baffled me about Amazon's pricing. I would have thought they price it the REVERSE where it is low price at first, and rises. For example, start with a "low introductory rate for the first Petabyte" to get small businesses addicted to Amazon services while Amazon still makes a (solid) profit, then when the small business grows into a large business that requires more than a Petabyte of data Amazon would increase the price because: 1) scaling is hard and does cost money, and 2) a company looks into the future and says "heck, if we reach a Petabyte we're making so much money we can AFFORD the higher Amazon rates", and 3) as a company grows quickly they have so many other problems they won't prioritize getting off Amazon, especially if Amazon is scaling well for them. Related side note: scaling really does cost extra money. For our online backup business, almost no customers have more than 10 million files in any one "backup" (each backup is "per laptop") so as programmers we can use any data structure we like to browse those files, a flat list IS FINE. But for B2, a large customer might have 1 billion files in one "bucket", and so we have to be a HECK of a lot smarter about how we organize that data so that the customer can still sign in with a web browser and view them all. For Backblaze, that meant moving up to a clustered hash database called Cassandra, and deploying (so far) about 50 1U computers, each with two CPUs, each with fast SSDs and a layer of complicated code to manage all of it. So the scaling requirements of the Personal Backup client required 0 extra servers, but at B2 scale it requires an additional $175,000 worth of equipment. Scale costs extra money.

tyingq 9y ago

Yes, I wasn't talking about your $0.01/GB egress charges. Amazon, for example, starts at $0.15/GB. It drops down with more volume, but it's obviously gouging to a ridiculous level.

brianwski 9y ago
> Amazon starts at $0.15/GB and drops with more volume. Which has ALWAYS baffled me about Amazon's pricing. I would have thought they price it the REVERSE where it is low price at first, and rises. For example, start with a "low introductory rate for the first Petabyte" to get small businesses addicted to Amazon services while Amazon still makes a (solid) profit, then when the small business grows into a large business that requires more than a Petabyte of data Amazon would increase the price because: 1) scaling is hard and does cost money, and 2) a company looks into the future and says "heck, if we reach a Petabyte we're making so much money we can AFFORD the higher Amazon rates", and 3) as a company grows quickly they have so many other problems they won't prioritize getting off Amazon, especially if Amazon is scaling well for them. Related side note: scaling really does cost extra money. For our online backup business, almost no customers have more than 10 million files in any one "backup" (each backup is "per laptop") so as programmers we can use any data structure we like to browse those files, a flat list IS FINE. But for B2, a large customer might have 1 billion files in one "bucket", and so we have to be a HECK of a lot smarter about how we organize that data so that the customer can still sign in with a web browser and view them all. For Backblaze, that meant moving up to a clustered hash database called Cassandra, and deploying (so far) about 50 1U computers, each with two CPUs, each with fast SSDs and a layer of complicated code to manage all of it. So the scaling requirements of the Personal Backup client required 0 extra servers, but at B2 scale it requires an additional $175,000 worth of equipment. Scale costs extra money.