9 ms·

I'm surprised Dell don't make they buy hard drives from them at a substantial mark-up, as they allude to vendors doing earlier in the story.

by jleahy 5y ago

tpetry 5y ago
Or dell forces them to buy their drives but their markup is not as high as their competitors?
- jleahy 5y ago
  The default markup is awful, check the Dell website. I'd describe the process of buying a drive from Dell a bit like getting mugged.
  - Analemma_ 5y ago
    I imagine if you're buying sixty pods a month every month you have some leverage with Dell to get better prices, especially if you have a demonstrated ability to just walk away and build your own if you don't like their offer.
- foobarbazetc 5y ago
  Dell (and, really, all server providers apart from Supermicro) have crazy markups on storage. It's where they make most of their margin. And then, most of the time, the drives they sell come on custom sleds that they don't sell separately as a form of DRM/lock in. Then you get a nice little trade on Chinese-made sleds that sort of work, but not for anything recent like hot swap NVMe drives. I'm sure BB were able to negotiate down a lot (Dell usually come down 50% off the list price if you press them hard enough for one off projects), but... yeah. That's how it generally goes.
- gnopgnip 5y ago
  If you are buying in bulk the pricing can be a lot better than the list prices. But generally there isn't a problem buying a server without a drive, Dell will still support the server for non disk related warranty issues, you don't need special firmware or disks
gpm 5y ago
Dell's not in the best negotiating position here, given that "build our own" is a valid alternative.
ineedasername 5y ago
Dell me be very happy to have a high volume customer with very standardized & predictable needs, and so they're happy with modest markups & extra profit on the service agreements, which is a nice benefit for Backblaze since building their own pods doesn't give them any service guarantee/warranty.

I'm surprised Dell don't make they buy hard drives from them at a substantial mark-up, as they allude to vendors doing earlier in the story.

by jleahy 5y ago

I'm surprised Dell don't make they buy hard drives from them at a substantial mark-up, as they allude to vendors doing earlier in the story.

tpetry 5y ago

Or dell forces them to buy their drives but their markup is not as high as their competitors?

jleahy 5y ago
The default markup is awful, check the Dell website. I'd describe the process of buying a drive from Dell a bit like getting mugged.
- Analemma_ 5y ago
  I imagine if you're buying sixty pods a month every month you have some leverage with Dell to get better prices, especially if you have a demonstrated ability to just walk away and build your own if you don't like their offer.
foobarbazetc 5y ago
Dell (and, really, all server providers apart from Supermicro) have crazy markups on storage. It's where they make most of their margin. And then, most of the time, the drives they sell come on custom sleds that they don't sell separately as a form of DRM/lock in. Then you get a nice little trade on Chinese-made sleds that sort of work, but not for anything recent like hot swap NVMe drives. I'm sure BB were able to negotiate down a lot (Dell usually come down 50% off the list price if you press them hard enough for one off projects), but... yeah. That's how it generally goes.
gnopgnip 5y ago
If you are buying in bulk the pricing can be a lot better than the list prices. But generally there isn't a problem buying a server without a drive, Dell will still support the server for non disk related warranty issues, you don't need special firmware or disks

gpm 5y ago

Dell's not in the best negotiating position here, given that "build our own" is a valid alternative.

ineedasername 5y ago

Dell me be very happy to have a high volume customer with very standardized & predictable needs, and so they're happy with modest markups & extra profit on the service agreements, which is a nice benefit for Backblaze since building their own pods doesn't give them any service guarantee/warranty.