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Own hardware is always cheaper to buy than using a cloud service, but keeping it running 24/7 involves substantial costs. Sure, if you run a solo operation, yo

by LeonM 8y ago

Own hardware is always cheaper to buy than using a cloud service, but keeping it running 24/7 involves substantial costs. Sure, if you run a solo operation, you can just get up during the night to nurse your server, but at some point that no longer makes sense to do. Somewhere along the way we forgot about this and it's now perfectly normal to run a blog on a GKE 3 VM kubernetes cluster, costing 140 EUR/month.

NightlyDev 8y ago
It's not expensive at all compared to cloud hosting to keep hardware running. Hardware is really stable and usually runs for years without any issues. You can even use colocation and remote hands, it isn't expensive.
vidarh 8y ago
I used to manage hardware in several datacentres, and I'd usually visit the data centres a couple of times a year. Other than that we used a couple of hours of "remote hands" services from the datacentre operator. Overall our hosting costs were about 30% of what the same capacity would have cost on AWS. Once a year I'd get a "why aren't we using AWS" e-mail from my boss, update our costing spreadsheets and tell him I'd happily move if he was ok with the costs, as it would have been more convenient for me personally, and every year the gap came out just too ridiculously huge to justify. In the end we started migrating to Hetzner, as they finally got servers that got close enough to be worth offloading that work to someone else. Notably Hetzner reached cost parity for us; AWS was still just as ridiculously overpriced. There are certainly scenarios where using AWS is worth it for the convenience or functionality. I use AWS for my current work for the convenience, for example. And AWS can often be cheaper than buying hardware. But I've never seen a case where AWS was the cheapest option, or even one of the cheapest, even when factoring in everything, unless you can use the free tier. AWS is great if you can justify the cost, though.
- mlrtime 8y ago
  When you create the spreadsheet, do you price in running servers 24x7 or using elastic capacity?
  - smilliken 8y ago
    (not the parent) We've seen an even wider cost disparity on colo and dedicated servers vs AWS. More than 5x. It's easy for us to estimate because databases and web servers need to be on all the time, and those dominate costs.
  - mmt 8y ago
    And if considering elastic capacity, do you include the cost of the engineering effort required to take advantage of it? A similar question applies to any other dynamic cost-reduction measure, such as spot instances. I recall reading an announcement that GCP was starting only charging for actually-used vCPUs, rather than all that were provisioned, a form of automatic elastic cost-savings, although it was still more expensive than a DIY method. AFAIK, AWS doesn't do anything like that.
  - vidarh 8y ago
    We had too low variations in load over the day to make elastic usage cost effective for the most part, so it made very little difference. Indeed, one of the most cost effective ways of using AWS is to not use it, but be ready to use it to handle traffic spikes. Do that and you can load your dedicated servers much closer to capacity, while almost never having to spin any instances up.
xfitm3 8y ago
I think the real answer to this question is unhelpful, which is: it depends. I ran a detailed cost analysis of tier 3 onprem vs aws about 7 years ago. I included the cost of maintaining servers, support staff salaries, rent, insurance, employee dwell time etc and onprem was still cheaper. Maybe it's different now. We put significant thought into being cheap. I think constraint can breed innovation.
mmt 8y ago
> keeping it running 24/7 involves substantial costs So does using a cloud service. It's not actually obvious, conceptually, but very little of the admin overhead has to do with the "own hardware" aspect of running it, especially if one excludes anything that has a direct analog at a cloud service. There certainly exist services that abstract away more of this, but that's in exchange for higher cost and lower top performance, but that doesn't scale (in terms of cost). > Sure, if you run a solo operation, you can just get up during the night to nurse your server, but at some point that no longer makes sense to do. I'd actually argue the reverse. My experience is that the own-hardware portion took at most a quarter of my time, and that remained constant up to several hundred servers. It's much cheaper per unit of infrastructure the more units you have. The tools and procedures that allow that kind of efficiency were the prerequisite for cloud services to exist.

by LeonM 8y ago

NightlyDev 8y ago

It's not expensive at all compared to cloud hosting to keep hardware running. Hardware is really stable and usually runs for years without any issues. You can even use colocation and remote hands, it isn't expensive.

vidarh 8y ago

I used to manage hardware in several datacentres, and I'd usually visit the data centres a couple of times a year. Other than that we used a couple of hours of "remote hands" services from the datacentre operator. Overall our hosting costs were about 30% of what the same capacity would have cost on AWS. Once a year I'd get a "why aren't we using AWS" e-mail from my boss, update our costing spreadsheets and tell him I'd happily move if he was ok with the costs, as it would have been more convenient for me personally, and every year the gap came out just too ridiculously huge to justify. In the end we started migrating to Hetzner, as they finally got servers that got close enough to be worth offloading that work to someone else. Notably Hetzner reached cost parity for us; AWS was still just as ridiculously overpriced. There are certainly scenarios where using AWS is worth it for the convenience or functionality. I use AWS for my current work for the convenience, for example. And AWS can often be cheaper than buying hardware. But I've never seen a case where AWS was the cheapest option, or even one of the cheapest, even when factoring in everything, unless you can use the free tier. AWS is great if you can justify the cost, though.

mlrtime 8y ago
When you create the spreadsheet, do you price in running servers 24x7 or using elastic capacity?
- smilliken 8y ago
  (not the parent) We've seen an even wider cost disparity on colo and dedicated servers vs AWS. More than 5x. It's easy for us to estimate because databases and web servers need to be on all the time, and those dominate costs.
- mmt 8y ago
  And if considering elastic capacity, do you include the cost of the engineering effort required to take advantage of it? A similar question applies to any other dynamic cost-reduction measure, such as spot instances. I recall reading an announcement that GCP was starting only charging for actually-used vCPUs, rather than all that were provisioned, a form of automatic elastic cost-savings, although it was still more expensive than a DIY method. AFAIK, AWS doesn't do anything like that.
- vidarh 8y ago
  We had too low variations in load over the day to make elastic usage cost effective for the most part, so it made very little difference. Indeed, one of the most cost effective ways of using AWS is to not use it, but be ready to use it to handle traffic spikes. Do that and you can load your dedicated servers much closer to capacity, while almost never having to spin any instances up.

xfitm3 8y ago

I think the real answer to this question is unhelpful, which is: it depends. I ran a detailed cost analysis of tier 3 onprem vs aws about 7 years ago. I included the cost of maintaining servers, support staff salaries, rent, insurance, employee dwell time etc and onprem was still cheaper. Maybe it's different now. We put significant thought into being cheap. I think constraint can breed innovation.

mmt 8y ago

> keeping it running 24/7 involves substantial costs So does using a cloud service. It's not actually obvious, conceptually, but very little of the admin overhead has to do with the "own hardware" aspect of running it, especially if one excludes anything that has a direct analog at a cloud service. There certainly exist services that abstract away more of this, but that's in exchange for higher cost and lower top performance, but that doesn't scale (in terms of cost). > Sure, if you run a solo operation, you can just get up during the night to nurse your server, but at some point that no longer makes sense to do. I'd actually argue the reverse. My experience is that the own-hardware portion took at most a quarter of my time, and that remained constant up to several hundred servers. It's much cheaper per unit of infrastructure the more units you have. The tools and procedures that allow that kind of efficiency were the prerequisite for cloud services to exist.