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Then they slowly turn into a datacenter company and lose sight of being a ride sharing company. That's the same reason billion dollar companies rent buildings i

Then they slowly turn into a datacenter company and lose sight of being a ride sharing company. That's the same reason billion dollar companies rent buildings instead of owning them.

piker 8y ago
This analogy somewhat fails given that buildings and equipment are a generally fixed cost/asset, whereas compute power, storeage, etc. are probably more of marginal costs for a technology company such as Lyft. It would suggest they also contract out most of their technology development as well.
- buboard 8y ago
  It doesn't own cars, doesnt employ drivers, doesnt own hardware, doesn't own compute or storage , doesnt develop software. What is lyft after all?
  - throwawaymath 8y ago
    It's just an idea. This is a little tongue in cheek, but: Lyft is an abstraction. It doesn't own anything or have any customers because it's a market maker. Lyft is an efficiency mechanism for maximizing liquidity and minimizing bid-ask spreads in hyperlocal ride trading :)
    - buboard 8y ago
      making the world a better place, one contractor at a time
  - kerng 8y ago
    A copy of Uber? They let Uber do all the dirt work and try to stay in the shadows.
joering2 8y ago
Absolutely. Next thing we know they stop selling books only and turn themselves into a cloud-services giant :|
geezerjay 8y ago
> Then they slowly turn into a datacenter company and lose sight of being a ride sharing company. That assertion makes no sense at all, particularly if we acknowledge the fact that they are in the business of providing a web service. IT infrastructure is critical to Lyft's core business. Would it make any more sense to criticise Lyft for hiring developers because that would mean they would slowly turn into a software development company?
wil421 8y ago
How would they become a data center company? There are 1000s of huge companies using a mix of colocated DCs, their own DCs, and cloud providers like AWS including the majority of Fortune 500 companies. Most of them are not datacenter companies like QTS.
- zjaffee 8y ago
  Most of these companies aren't managing their own data centers at least for areas that use a large amount of compute. Banks and the like that have their own data centers, generally are still using some type of contractor to manage the physical real estate, network connections, ect. even if they are the ones purchasing the servers.
  - wil421 8y ago
    Come on, that’s like saying Google has no business having datacenters because they are an Advertising and Search company. Of course large companies will have contractors to scale up and down. They will have FTEs doing System Administration and Software Engineering on the servers.
  - llama052 8y ago
    As if Google or Amazon isn't using contractors for some of their stuff as well?
Scoundreller 8y ago
I thought that was a tax law thing: Real Estate Income Trusts don’t pay any tax on their distributions, and nor do you (immediately) if they’re in a tax-deferred or tax-free account. In other words, holding real estate in a Corp that does other stuff isn’t efficient.
carlisle_ 8y ago
Uber hosts its own infrastructure, so does Google, so does Facebook. All three of those companies have no problems remaining focused on their business models without turning into a "datacenter company." I strongly dislike the notion that on-prem hosting is somehow a bad thing, or too cumbersome, or otherwise totally solved by cloud providers. AWS specifically is hugely convenient in a number of ways, but it doesn't come close to the cost savings from running your own infrastructure. You need a pretty large amount of capital and engineering talent, but it really is worth it even in the short term (~3-5 years). I think people would be shocked at what the money comes out to be if they saw costs from companies doing their own physical infrastructure. AWS makes you pay through the nose, seeing the difference would change a lot of minds I'm sure.
- djsumdog 8y ago
  The trouble is when people build around Amazon, they get locked into a lot of those services. Sure you can run your own DBs instead of using RDS, but what if you start using their proprietary rubbish, like Knesis or DynamoDB? You have to rewrite application to use something else that's open source and self-hostable. For new startups, I honestly recommend using DigitalOcean or Vultur. You don't get all the AWS components, but you can build around flexibility. If you have to move, you can take all your Terraform and Anisble scripts, and port them to a new provider (and yes, you do have to rewrite your Terraform config. Every provider is insanely different and the magic of multi-cloud is a myth, but it's still easier than trying to move off of AWS specific services). I remember back in the day, Stackoverflow ran everything off of a single, very expensive, dedicated server. I've worked at other shops where we've migrated stuff from AWS to self hosted solutions to reduce our $200k/month AWS bill.
  - CondensedBrain 8y ago
    Netflix and its (ongoing?) transition from AWS to its own systems might provide some guidance if they ever decide to do the same.
    - sciurus 8y ago
buboard 8y ago
> slowly turn into a datacenter company That didn't turn out very bad for amazon And frankly i 'd rather invest in a cloud company than a money-losing taxi company.
Havoc 8y ago
>That's the same reason billion dollar companies rent buildings instead of owning them. If you've got billions then you can create your own limited liability company, poach a bit of top talent to fill it (overpay a bit if you must) and get a decent operation going. One that will jump when you say jump no matter what. You can't replace AWS global scale, but for your rental example its definitely possible. Companies rent mostly due to tax & liability reasons from what I can tell.
hhw 8y ago
They could also just rent dedicated bare metal servers on a month-to-month basis, getting whatever hardware specs they want so long as it's not overly exotic. Then they don't have to worry about anything at the data centre or hardware level. Given that cloud costs easily 6-7x for the equivalent amount of hardware resources as a well priced dedicated server provider, you can just buy 2-3x the resources you need for extra scalability and not have to share those resources with anyone. Or if you are in the tiny minority of companies that really does have extremely erratic load requirements, you can put your base load on bare metal and your excess load on cloud. I don't understand why people on HN always put forth a false dichotomy between cloud and running your own data centre when there's a plethora of different mixes of infrastructure and managed services that falls in between.
fma 8y ago
General Motors has built 2 data centers. Each one costs about what Lyft spends per year on AWS (https://media.gm.com/media/us/en/gm/news.detail.html/content/Pages/news/us/en/2013/May/0513-milford-data.html https://media.gm.com/media/us/en/gm/news.detail.html/content...) Article says it takes 20 people to run. GM hasnt turned into a datacenter company... Is a century old car manufacturer in Detroit able to do what a startup in Silicone Valley can't? Interestingly enough, GM owns 7.8% of Lyft.

Then they slowly turn into a datacenter company and lose sight of being a ride sharing company. That's the same reason billion dollar companies rent buildings instead of owning them.

piker 8y ago

This analogy somewhat fails given that buildings and equipment are a generally fixed cost/asset, whereas compute power, storeage, etc. are probably more of marginal costs for a technology company such as Lyft. It would suggest they also contract out most of their technology development as well.

buboard 8y ago
It doesn't own cars, doesnt employ drivers, doesnt own hardware, doesn't own compute or storage , doesnt develop software. What is lyft after all?
- throwawaymath 8y ago
  It's just an idea. This is a little tongue in cheek, but: Lyft is an abstraction. It doesn't own anything or have any customers because it's a market maker. Lyft is an efficiency mechanism for maximizing liquidity and minimizing bid-ask spreads in hyperlocal ride trading :)
  - buboard 8y ago
    making the world a better place, one contractor at a time
- kerng 8y ago
  A copy of Uber? They let Uber do all the dirt work and try to stay in the shadows.

joering2 8y ago

Absolutely. Next thing we know they stop selling books only and turn themselves into a cloud-services giant :|

geezerjay 8y ago

> Then they slowly turn into a datacenter company and lose sight of being a ride sharing company. That assertion makes no sense at all, particularly if we acknowledge the fact that they are in the business of providing a web service. IT infrastructure is critical to Lyft's core business. Would it make any more sense to criticise Lyft for hiring developers because that would mean they would slowly turn into a software development company?

wil421 8y ago

How would they become a data center company? There are 1000s of huge companies using a mix of colocated DCs, their own DCs, and cloud providers like AWS including the majority of Fortune 500 companies. Most of them are not datacenter companies like QTS.

zjaffee 8y ago
Most of these companies aren't managing their own data centers at least for areas that use a large amount of compute. Banks and the like that have their own data centers, generally are still using some type of contractor to manage the physical real estate, network connections, ect. even if they are the ones purchasing the servers.
- wil421 8y ago
  Come on, that’s like saying Google has no business having datacenters because they are an Advertising and Search company. Of course large companies will have contractors to scale up and down. They will have FTEs doing System Administration and Software Engineering on the servers.
- llama052 8y ago
  As if Google or Amazon isn't using contractors for some of their stuff as well?

Scoundreller 8y ago

I thought that was a tax law thing: Real Estate Income Trusts don’t pay any tax on their distributions, and nor do you (immediately) if they’re in a tax-deferred or tax-free account. In other words, holding real estate in a Corp that does other stuff isn’t efficient.

carlisle_ 8y ago

Uber hosts its own infrastructure, so does Google, so does Facebook. All three of those companies have no problems remaining focused on their business models without turning into a "datacenter company." I strongly dislike the notion that on-prem hosting is somehow a bad thing, or too cumbersome, or otherwise totally solved by cloud providers. AWS specifically is hugely convenient in a number of ways, but it doesn't come close to the cost savings from running your own infrastructure. You need a pretty large amount of capital and engineering talent, but it really is worth it even in the short term (~3-5 years). I think people would be shocked at what the money comes out to be if they saw costs from companies doing their own physical infrastructure. AWS makes you pay through the nose, seeing the difference would change a lot of minds I'm sure.

djsumdog 8y ago
The trouble is when people build around Amazon, they get locked into a lot of those services. Sure you can run your own DBs instead of using RDS, but what if you start using their proprietary rubbish, like Knesis or DynamoDB? You have to rewrite application to use something else that's open source and self-hostable. For new startups, I honestly recommend using DigitalOcean or Vultur. You don't get all the AWS components, but you can build around flexibility. If you have to move, you can take all your Terraform and Anisble scripts, and port them to a new provider (and yes, you do have to rewrite your Terraform config. Every provider is insanely different and the magic of multi-cloud is a myth, but it's still easier than trying to move off of AWS specific services). I remember back in the day, Stackoverflow ran everything off of a single, very expensive, dedicated server. I've worked at other shops where we've migrated stuff from AWS to self hosted solutions to reduce our $200k/month AWS bill.
- CondensedBrain 8y ago
  Netflix and its (ongoing?) transition from AWS to its own systems might provide some guidance if they ever decide to do the same.
  - sciurus 8y ago

buboard 8y ago

> slowly turn into a datacenter company That didn't turn out very bad for amazon And frankly i 'd rather invest in a cloud company than a money-losing taxi company.

Havoc 8y ago

>That's the same reason billion dollar companies rent buildings instead of owning them. If you've got billions then you can create your own limited liability company, poach a bit of top talent to fill it (overpay a bit if you must) and get a decent operation going. One that will jump when you say jump no matter what. You can't replace AWS global scale, but for your rental example its definitely possible. Companies rent mostly due to tax & liability reasons from what I can tell.

hhw 8y ago

They could also just rent dedicated bare metal servers on a month-to-month basis, getting whatever hardware specs they want so long as it's not overly exotic. Then they don't have to worry about anything at the data centre or hardware level. Given that cloud costs easily 6-7x for the equivalent amount of hardware resources as a well priced dedicated server provider, you can just buy 2-3x the resources you need for extra scalability and not have to share those resources with anyone. Or if you are in the tiny minority of companies that really does have extremely erratic load requirements, you can put your base load on bare metal and your excess load on cloud. I don't understand why people on HN always put forth a false dichotomy between cloud and running your own data centre when there's a plethora of different mixes of infrastructure and managed services that falls in between.

fma 8y ago

General Motors has built 2 data centers. Each one costs about what Lyft spends per year on AWS (https://media.gm.com/media/us/en/gm/news.detail.html/content/Pages/news/us/en/2013/May/0513-milford-data.html https://media.gm.com/media/us/en/gm/news.detail.html/content...) Article says it takes 20 people to run. GM hasnt turned into a datacenter company... Is a century old car manufacturer in Detroit able to do what a startup in Silicone Valley can't? Interestingly enough, GM owns 7.8% of Lyft.