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That argument doesn’t hold up. If how could AWS be cheaper than doing it yourself at that scale? Like if you are a tiny company that can’t afford your own DC, y
by IgorPartola 5y ago
That argument doesn’t hold up. If how could AWS be cheaper than doing it yourself at that scale? Like if you are a tiny company that can’t afford your own DC, your own engineers, etc. then yes AWS is cheaper in absolute costs but not in per-byte costs. But at scale you should be able to hire engineers and build out a DC at which point you aren’t paying the AWS margin, which is how you save money.
In other words your assessment would only be true if AWS had a 0% or a negative margin.
- kevincox 5y agoThere is still an economy of scale. You are right, as you use more resources your economy of scale will increase, but it will never match AWS's (unless you are huge). So the math is if the AWS margin is less than the difference between the two different economies of scale then it makes sense to run your own datacenters (ignoring the opportunity cost of the transition costs). Of course at some point the margin will exceed that difference, but depending on what type of infrastructure you need it can be at a very high point.
- IgorPartola 5y agoYour last point is the important part: depending on the type of infrastructure you need you might be able to save money. If you want a cheap place to dump your files, B2 is cheaper than S3 and raw storage hardware pays for itself in about a year. If you need a sophisticated CDN then yeah you’ll need to be huge before it pays for itself. I would consider ditching S3 at the point where I can hire two full time engineers to worry about my storage layer.