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The only difference between wework and amazon is the way they finance their money-losing ventures. Wework does that via the private market, hence the game is u

The only difference between wework and amazon is the way they finance their money-losing ventures. Wework does that via the private market, hence the game is up when it needs access to the public markets. Amazon does that via AWS. AWS is the money that fuels the eCommerce side. The game will be up when: 1) Kubernetes will move AWS customers back to on-prem, or at least turn clouds into a commodity. Amazon knows that and this is the reason for the push toward lockin (aka lambda / serverless). 2) Amazon will be divided into two companies.

WalterBright 7y ago
AWS did not become a product until Amazon had been around for several years.
- unreal37 7y ago
  But today, AWS is hugely profitable and hides the money losing parts of the business.
rossdavidh 7y ago
It's interesting that you bring up the importance of AWS to Amazon, nowadays, because...companies like Uber, Lyft, and WeWork spend a lot on AWS. In other words, like Yahoo getting a lot of their late-90's advertising from dot-com bubble companies that evaporated in 2001, AWS is massively exposed to the current bubble in "we have so much VC cash we don't know what to do with it" companies. When that goes away (i.e. the next downturn), AWS will lose a huge chunk of their business all at once. It will be interesting to see what Amazon's bottom line looks like at that point.
- buboard 7y ago
  Amazon must know that and i guess thats why they dont give up the commerce biz
  - jethro_tell 7y ago
    Lol, or the bulk of the AWS income that is probably boring enterprise. Sure, less startups is less cpu cycles bought, but there are a shit tone of companies that aren't going to scale down in a massive way. yahoo was at risk because the BULK of their ad business was ads for a budding industry that was hit hard. Normal boring enterprise was still selling buying ads elsewhere.
- streetcat1 7y ago
  So I am not sure. I think that startups (with all due respect) generate buzz, inversely correlated with their technical depth. So AWS is mainly composed of non tech companies. I also think that AWS did an excellent job locking its customers, so they cannot just "leave". The real treat here is kubernetes. If I program to kubernetes , I can, in theory, move the workload from cloud to cloud, or move the workload from on prem to cloud. This brings actual competition to the cloud space. The problem is how to provide all the high-level services that AWS provide, and this will have to be taken by future startups which would extend kubernetes.
hef19898 7y ago
So tue. AWS is generating the biggest part of overall profits while contributing 10% of revenue (from top of my head, so numbers might be wrong). Only logic that one day Amazon would be split up. Might also partially explain the high valuation.
chx 7y ago
Kubernetes is only a threat in that it is a buzzword much as cloud is a buzzword. The cloud and Kubernetes both are used to sell a triple fallacy: You need to care about scaling from day one, there is an easy way to scale, this way is the cloud/Kubernetes. For almost all startups their app would run comfortably on a single dedicated server. This has been true for many, many years but only the YAGNI greybeards would go with it. Maybe two HA but even HA is overhyped, it's cheaper to be down. Down is part of this industry, you will be down in many circumstances anyways so perhaps don't chase a unicorn? Of course, above a certain size, two servers make sense but ... don't overdo it even then. You don't need microservices, you don't need containers. All of this is unnecessary hype. (And yes, both of you who works at a large enough company where being down is enough of a problem that it worths engineering about: good for you. I have architected a Top 100 website myself and we still didn't use more than a dozen servers and that included the staging infra.) Gary Bernhardt of WAT fame from 2015 https://twitter.com/garybernhardt/status/600783770925420546?lang=en https://twitter.com/garybernhardt/status/600783770925420546?... > Consulting service: you bring your big data problems to me, I say "your data set fits in RAM", you pay me $10,000 for saving you $500,000. Very strongly related: a terabyte of RAM in just 16 modules so it fits most server boards is now under $5000 https://memory.net/product/p00926-b21-hp-1x-64gb-ddr4-2933-lrdimm-pc4-23466u-l-quad-rank-x4-replacement/ https://memory.net/product/p00926-b21-hp-1x-64gb-ddr4-2933-l... Final shot, codinghorror of StackOverflow fame: https://twitter.com/codinghorror/status/347070841059692545 https://twitter.com/codinghorror/status/347070841059692545
- rexarex 7y ago
  Cheaper to be down? I guess if you don’t have users sure.
  - chx 7y ago
    Having a hot spare, a database slave and a mirror of your assets so you can manually fail over? Probably a good idea. Architecting a very HA infra? Now wait and look hard at all the possible downtime causes (you have a DDoS provider for sure, Voxility or Cloudflare probably, what if they go down and so forth) and so and then look at what you are protecting against: a hardware failure which is exceedingly rare and again you can manually failover. The costs vs benefits will not come out in your favor up to a very large company size where even the smallest amount of downtime is so costly it doesn't matter how many engineering hours go into avoiding it.
imtringued 7y ago
Operating a kubernetes cluster on-prem is much harder than you think. Kubernetes is an overcomplicated mess if you want to build a cluster yourself and it's a mess every time you want to upgrade to a newer version.

WalterBright 7y ago

AWS did not become a product until Amazon had been around for several years.

unreal37 7y ago
But today, AWS is hugely profitable and hides the money losing parts of the business.

rossdavidh 7y ago

It's interesting that you bring up the importance of AWS to Amazon, nowadays, because...companies like Uber, Lyft, and WeWork spend a lot on AWS. In other words, like Yahoo getting a lot of their late-90's advertising from dot-com bubble companies that evaporated in 2001, AWS is massively exposed to the current bubble in "we have so much VC cash we don't know what to do with it" companies. When that goes away (i.e. the next downturn), AWS will lose a huge chunk of their business all at once. It will be interesting to see what Amazon's bottom line looks like at that point.

buboard 7y ago
Amazon must know that and i guess thats why they dont give up the commerce biz
- jethro_tell 7y ago
  Lol, or the bulk of the AWS income that is probably boring enterprise. Sure, less startups is less cpu cycles bought, but there are a shit tone of companies that aren't going to scale down in a massive way. yahoo was at risk because the BULK of their ad business was ads for a budding industry that was hit hard. Normal boring enterprise was still selling buying ads elsewhere.
streetcat1 7y ago
So I am not sure. I think that startups (with all due respect) generate buzz, inversely correlated with their technical depth. So AWS is mainly composed of non tech companies. I also think that AWS did an excellent job locking its customers, so they cannot just "leave". The real treat here is kubernetes. If I program to kubernetes , I can, in theory, move the workload from cloud to cloud, or move the workload from on prem to cloud. This brings actual competition to the cloud space. The problem is how to provide all the high-level services that AWS provide, and this will have to be taken by future startups which would extend kubernetes.

hef19898 7y ago

So tue. AWS is generating the biggest part of overall profits while contributing 10% of revenue (from top of my head, so numbers might be wrong). Only logic that one day Amazon would be split up. Might also partially explain the high valuation.

chx 7y ago

Kubernetes is only a threat in that it is a buzzword much as cloud is a buzzword. The cloud and Kubernetes both are used to sell a triple fallacy: You need to care about scaling from day one, there is an easy way to scale, this way is the cloud/Kubernetes. For almost all startups their app would run comfortably on a single dedicated server. This has been true for many, many years but only the YAGNI greybeards would go with it. Maybe two HA but even HA is overhyped, it's cheaper to be down. Down is part of this industry, you will be down in many circumstances anyways so perhaps don't chase a unicorn? Of course, above a certain size, two servers make sense but ... don't overdo it even then. You don't need microservices, you don't need containers. All of this is unnecessary hype. (And yes, both of you who works at a large enough company where being down is enough of a problem that it worths engineering about: good for you. I have architected a Top 100 website myself and we still didn't use more than a dozen servers and that included the staging infra.) Gary Bernhardt of WAT fame from 2015 https://twitter.com/garybernhardt/status/600783770925420546?lang=en https://twitter.com/garybernhardt/status/600783770925420546?... > Consulting service: you bring your big data problems to me, I say "your data set fits in RAM", you pay me $10,000 for saving you $500,000. Very strongly related: a terabyte of RAM in just 16 modules so it fits most server boards is now under $5000 https://memory.net/product/p00926-b21-hp-1x-64gb-ddr4-2933-lrdimm-pc4-23466u-l-quad-rank-x4-replacement/ https://memory.net/product/p00926-b21-hp-1x-64gb-ddr4-2933-l... Final shot, codinghorror of StackOverflow fame: https://twitter.com/codinghorror/status/347070841059692545 https://twitter.com/codinghorror/status/347070841059692545

rexarex 7y ago
Cheaper to be down? I guess if you don’t have users sure.
- chx 7y ago
  Having a hot spare, a database slave and a mirror of your assets so you can manually fail over? Probably a good idea. Architecting a very HA infra? Now wait and look hard at all the possible downtime causes (you have a DDoS provider for sure, Voxility or Cloudflare probably, what if they go down and so forth) and so and then look at what you are protecting against: a hardware failure which is exceedingly rare and again you can manually failover. The costs vs benefits will not come out in your favor up to a very large company size where even the smallest amount of downtime is so costly it doesn't matter how many engineering hours go into avoiding it.

imtringued 7y ago

Operating a kubernetes cluster on-prem is much harder than you think. Kubernetes is an overcomplicated mess if you want to build a cluster yourself and it's a mess every time you want to upgrade to a newer version.