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Opposing view. Cloudflare doesn’t own anything significant in the form of data centers. Having small rented footprints at IXPs across the globe is not an asset

Opposing view. Cloudflare doesn’t own anything significant in the form of data centers. Having small rented footprints at IXPs across the globe is not an asset, it’s just a cost. I’m not downplaying the difficulty of getting it setup but there is no intrinsic value in having it if demand for their product collapses. > Developer sentiment towards Cloudflare is comparable to Apple fanboys of the previous decade This is far from true. People begrudgingly pay protection money to cloudflare to protect themselves from DDoS attacks. Very few significant operations depend deeply on the cloudflare stack. It has not been the AWS alternative it set out to be with the launch of its lambda like edge compute products. An AWS, Azure, or Google DDoS protection product could eat Cloudflare’s market in a hot minute. Cloudflare can’t escape being a “feature” of a cloud provider. (Disclosure, I sold out of Cloudflare at the end of the year when it failed to gain significant traction.)

onion2k 5y ago
Cloudflare doesn’t own anything significant in the form of data centers. Having small rented footprints at IXPs across the globe is not an asset, it’s just a cost. I’m not downplaying the difficulty of getting it setup but there is no intrinsic value in having it if demand for their product collapses. I don't understand this point. If there's a risk that demand will collapse isn't it better not to own the data centers? By renting CF can reduce their costs quickly in the face of falling demand. That's a feature. An AWS, Azure, or Google DDoS protection product could eat Cloudflare’s market in a hot minute. Cloudflare can’t escape being a “feature” of a cloud provider. This is also true of any other software company though - at some point a bigger company might offer whatever product as a feature. It's just a risk of building a software company - what we build is largely straightforward to copy. That doesn't mean there's no value in software as a product though.
- kortilla 4y ago
  > there's a risk that demand will collapse isn't it better not to own the data centers? By renting CF can reduce their costs quickly in the face of falling demand. That's a feature. But it’s not an asset. Do you know what an asset is?
tshaddox 5y ago
Why do you call it “protection money”? Surely Cloudflare doesn’t directly or indirectly cause DDoS attacks for people who don’t pay them.
- londons_explore 5y ago
  Well it is certainly good for cloudflares business if a DDoS attacks become more common....
AceyMan 5y ago
Capitalism is just a bad ecology. When whole species get torn down in one solar year bc some other species began to adopt a winning adaptation, that seems prone to overshooting (excessive curve fitting to the first derivative), with odd/suboptimal outcomes as no surprise.
- nverno 5y ago
  without natural competition this would be a barren planet
jsjohnst 5y ago
> Cloudflare doesn’t own anything significant in the form of data centers. Having small rented footprints at IXPs across the globe is not an asset, it’s just a cost. Akamai is the leading global CDN provider, want to guess how many data centers they own? Sure, owning a data center is an asset, but it’s also a liability too.
- bogomipz 5y ago
  How is it a liability? It's real estate holdings, often in or near desirable cities.

onion2k 5y ago

Cloudflare doesn’t own anything significant in the form of data centers. Having small rented footprints at IXPs across the globe is not an asset, it’s just a cost. I’m not downplaying the difficulty of getting it setup but there is no intrinsic value in having it if demand for their product collapses. I don't understand this point. If there's a risk that demand will collapse isn't it better not to own the data centers? By renting CF can reduce their costs quickly in the face of falling demand. That's a feature. An AWS, Azure, or Google DDoS protection product could eat Cloudflare’s market in a hot minute. Cloudflare can’t escape being a “feature” of a cloud provider. This is also true of any other software company though - at some point a bigger company might offer whatever product as a feature. It's just a risk of building a software company - what we build is largely straightforward to copy. That doesn't mean there's no value in software as a product though.

kortilla 4y ago
> there's a risk that demand will collapse isn't it better not to own the data centers? By renting CF can reduce their costs quickly in the face of falling demand. That's a feature. But it’s not an asset. Do you know what an asset is?

tshaddox 5y ago

Why do you call it “protection money”? Surely Cloudflare doesn’t directly or indirectly cause DDoS attacks for people who don’t pay them.

londons_explore 5y ago
Well it is certainly good for cloudflares business if a DDoS attacks become more common....

AceyMan 5y ago

Capitalism is just a bad ecology. When whole species get torn down in one solar year bc some other species began to adopt a winning adaptation, that seems prone to overshooting (excessive curve fitting to the first derivative), with odd/suboptimal outcomes as no surprise.

nverno 5y ago
without natural competition this would be a barren planet

jsjohnst 5y ago

> Cloudflare doesn’t own anything significant in the form of data centers. Having small rented footprints at IXPs across the globe is not an asset, it’s just a cost. Akamai is the leading global CDN provider, want to guess how many data centers they own? Sure, owning a data center is an asset, but it’s also a liability too.

bogomipz 5y ago
How is it a liability? It's real estate holdings, often in or near desirable cities.