2 ms·

There 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

There 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 ago
Your 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.