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Sorry for the naive question, but to offer those prices, there are two options: A) Amazon is losing money to keep Netflix as their client, B) They are doing pro

by 101008 5y ago

Sorry for the naive question, but to offer those prices, there are two options: A) Amazon is losing money to keep Netflix as their client, B) They are doing profit even with $0.20/TB, which means the $120/TB is, at least, 119.80 profitable. Wow.

kristjansson 5y ago
AWS {in,e}gress pricing strategy is not motivated by their cost of provisioning that service. Cloudflare had a good (if self-motivated) analysis of their cost structure discussed on here a while ago https://news.ycombinator.com/item?id=27930151 https://news.ycombinator.com/item?id=27930151
manquer 5y ago
$0.20/ TB costs is not for their agreements with Amazon, bulk of their video traffic is directly peering with ISPs, AWS largely serves for their APIs, and orchestration infrastructure. Amazon and most Cloud providers do overcharge for b/w. You can buy a OVH/Hetzner type box with a guaranteed un-metered 1 Gbps public bandwidth for ~ $120/month easily, which if fully utilized is equivalent 325TB / month or $3-4/TB, completely ignoring the 8/16 core bare metal server and attached storage you also get. This is SMB/ self-service prices, you can get much deals with basic negotiating and getting into a contract with a DC. One thing to remember though not all bandwidth are equal, CSPs like AWS provide a lot of features such as very elastic scale up on-demand, a lot of protection up to L4 and advanced SDN under the hood to make sure your VMs can leverage the b/w, that is computationally expensive and costly.
robocat 5y ago
Netflix has appliances installed at exchange points that caches most of Netflix. Each appliance peers locally and serves the streams locally. The inbound data stream to fill the cache of the appliance is rate limited and time limited - see https://openconnect.zendesk.com/hc/en-us/articles/360035618071 https://openconnect.zendesk.com/hc/en-us/articles/3600356180... The actual inbound data to the appliance will be higher than the fill because not everything is cached. The outbound stream from the appliance serves consumers. In New Zealand for example, Netflix has 40Gbps of connectivity to a peering exchange in Auckland. https://www.peeringdb.com/ix/97 https://www.peeringdb.com/ix/97 So although total Netflix bandwidth to consumers is massive, it has little in common with the bandwidth you pay for at Amazon. Disclaimer: I am not a network engineer.

by 101008 5y ago

kristjansson 5y ago

AWS {in,e}gress pricing strategy is not motivated by their cost of provisioning that service. Cloudflare had a good (if self-motivated) analysis of their cost structure discussed on here a while ago https://news.ycombinator.com/item?id=27930151 https://news.ycombinator.com/item?id=27930151

manquer 5y ago

$0.20/ TB costs is not for their agreements with Amazon, bulk of their video traffic is directly peering with ISPs, AWS largely serves for their APIs, and orchestration infrastructure. Amazon and most Cloud providers do overcharge for b/w. You can buy a OVH/Hetzner type box with a guaranteed un-metered 1 Gbps public bandwidth for ~ $120/month easily, which if fully utilized is equivalent 325TB / month or $3-4/TB, completely ignoring the 8/16 core bare metal server and attached storage you also get. This is SMB/ self-service prices, you can get much deals with basic negotiating and getting into a contract with a DC. One thing to remember though not all bandwidth are equal, CSPs like AWS provide a lot of features such as very elastic scale up on-demand, a lot of protection up to L4 and advanced SDN under the hood to make sure your VMs can leverage the b/w, that is computationally expensive and costly.

robocat 5y ago

Netflix has appliances installed at exchange points that caches most of Netflix. Each appliance peers locally and serves the streams locally. The inbound data stream to fill the cache of the appliance is rate limited and time limited - see https://openconnect.zendesk.com/hc/en-us/articles/360035618071 https://openconnect.zendesk.com/hc/en-us/articles/3600356180... The actual inbound data to the appliance will be higher than the fill because not everything is cached. The outbound stream from the appliance serves consumers. In New Zealand for example, Netflix has 40Gbps of connectivity to a peering exchange in Auckland. https://www.peeringdb.com/ix/97 https://www.peeringdb.com/ix/97 So although total Netflix bandwidth to consumers is massive, it has little in common with the bandwidth you pay for at Amazon. Disclaimer: I am not a network engineer.