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I hear this core competency stuff a lot and it’s just not so. I need organizations as small as teams of video editors run their own “datacenters” which may con

I hear this core competency stuff a lot and it’s just not so. I need organizations as small as teams of video editors run their own “datacenters” which may consist of as little as a Jellyfin server. A waste of resources? Is centralization into cloud datacenters or even CDNs all the way to the last mile a more efficient use of resources than plugging a 10gig connection into a NAS? Why haven’t all restaurants been destroyed by Taco Bell when Taco Bell has economies of scale and efficiency most restaurants couldn’t dream of? Plenty of mid sized data centres make sense too. Something I see in common with many of these businesses is either the requirement to store a lot of stateful data or to have data locality and to not be concerned with things like being able to serve international customers or being a plodding business which will predict at a steady predictable rate. Some people run businesses that run headfirst into cloud companies entire pricing strategy because their business doesn’t work like a VC funded tech startup. The “but somebody can figure all this stuff out for you” cuts both ways. Why can’t a skilled company make it easier to staff and operate an on premise data centre? Running a datacenter only gets less labour intensive for what you get every year. You know that you can hire people for pretty much any aspect of building or maintaining a datacenter that you can imagine? The datacenter is commodified so why is it special that the cloud is? I just feel this analysis is a spurious oversimplification and what you’re far more likely to see is a sort of Pareto distribution of datacenters and the cloud is never going to swallow the whole market.

xfitm3 4y ago
I did an extensive cost analysis of a 1MW datacenter vs Cloud 10 years or so ago, so this stale data but take it as an anecdote. Accounting for the lease, facillity equipment (UPS, STS, CRACs, generator, fuel, raised flooring, cabinets, BMS, etc), compute equipment (PDUs, servers, spare parts), facilities and technical staff, the costs for AWS were substantially cheaper. The trick is you need skills, most of which are not in demand anymore and difficult to fill. If you pretend like you can hire and manage: the results are clear. There are opex/capex aspects which I don't understand, I amortized servers with an average server lifetime of 3 years. It's easier for most people to spend money with one vendor, though, and that's where AWS/GCP makes sense.
- tluyben2 4y ago
  It really depends on your demands; a lot of companies are running 1000s of trivial web applications and that’s it. Those can run on 10 year old servers which cost nothing at all anymore and never break; I have a few racks of them (HP dl360). We have not had issues in our colo for those 10 years; I didn’t even replace a drive and these are mostly spinning. Sure cloud is easier and if you need things that aws offers then go for it; we run well on a few $100/mo. Our most sold/popular product costs (I did this calc because of another ‘cloud is great’ HN post a few months back) less than $1/mo to host and maintain and has 50k+ active users. I like and use aws but it makes no sense in many cases; I would rob myself running most of our products on it because they don’t require remotely anything that it offers. I think the ‘make a unicorn’ mindset messed up people’s bottom line understanding; making 10k-100k$ more profit seems pathetic to companies that raised 100m$. Thing is; that is real money and I definitely rather have dinner with my colleagues than send it to Amazon.
- faeriechangling 4y ago
  Datacenter skills have NEVER been in more demand, datacenter is BOOMING and even the people who work in the AWS datacenter aren’t doomed to work there for eternity their skills forever captured by big tech. I honestly don’t know what you’re talking about, the skills are out there, they just don’t come cheap. Many businesses at a scale to run their own datacenters are also at a scale to have a relationship with local schools and managers will literally build pipeline of employees and maintain this pipeline for decades. The only staffing issue is these datacenter workers are just making so much money and getting so much work can you afford to hire them during this boom? Being able to avoid most of the costs and training and staffing you’re talking about has been a thing for a LONG time before the rise of cloud. There’s long been plenty of companies that will run the datacenter infrastructure for you or ever servers and let you hash out the details. People still made their own datacenters and continue to do so to this day. That is not why cloud has been so successful, the biggest thing cloud did to be successful was pioneer a new pay per use business model and the tools to enable it. Later on they created a bunch of new business innovations like EverythingAAS. If those innovations don’t come into play, AWS isn’t more attractive than Hetzner. I’ve built and decommissioned smaller datacenters for different businesses a bit under 1MW. I’ve seen datacenters make no sense, I’ve seen datacenters make complete sense.
adrianN 4y ago
You'd be surprised how many restaurants base large parts of their menu on reselling pre-prepped food that they just throw in a deepfryer.

xfitm3 4y ago

I did an extensive cost analysis of a 1MW datacenter vs Cloud 10 years or so ago, so this stale data but take it as an anecdote. Accounting for the lease, facillity equipment (UPS, STS, CRACs, generator, fuel, raised flooring, cabinets, BMS, etc), compute equipment (PDUs, servers, spare parts), facilities and technical staff, the costs for AWS were substantially cheaper. The trick is you need skills, most of which are not in demand anymore and difficult to fill. If you pretend like you can hire and manage: the results are clear. There are opex/capex aspects which I don't understand, I amortized servers with an average server lifetime of 3 years. It's easier for most people to spend money with one vendor, though, and that's where AWS/GCP makes sense.

tluyben2 4y ago
It really depends on your demands; a lot of companies are running 1000s of trivial web applications and that’s it. Those can run on 10 year old servers which cost nothing at all anymore and never break; I have a few racks of them (HP dl360). We have not had issues in our colo for those 10 years; I didn’t even replace a drive and these are mostly spinning. Sure cloud is easier and if you need things that aws offers then go for it; we run well on a few $100/mo. Our most sold/popular product costs (I did this calc because of another ‘cloud is great’ HN post a few months back) less than $1/mo to host and maintain and has 50k+ active users. I like and use aws but it makes no sense in many cases; I would rob myself running most of our products on it because they don’t require remotely anything that it offers. I think the ‘make a unicorn’ mindset messed up people’s bottom line understanding; making 10k-100k$ more profit seems pathetic to companies that raised 100m$. Thing is; that is real money and I definitely rather have dinner with my colleagues than send it to Amazon.
faeriechangling 4y ago
Datacenter skills have NEVER been in more demand, datacenter is BOOMING and even the people who work in the AWS datacenter aren’t doomed to work there for eternity their skills forever captured by big tech. I honestly don’t know what you’re talking about, the skills are out there, they just don’t come cheap. Many businesses at a scale to run their own datacenters are also at a scale to have a relationship with local schools and managers will literally build pipeline of employees and maintain this pipeline for decades. The only staffing issue is these datacenter workers are just making so much money and getting so much work can you afford to hire them during this boom? Being able to avoid most of the costs and training and staffing you’re talking about has been a thing for a LONG time before the rise of cloud. There’s long been plenty of companies that will run the datacenter infrastructure for you or ever servers and let you hash out the details. People still made their own datacenters and continue to do so to this day. That is not why cloud has been so successful, the biggest thing cloud did to be successful was pioneer a new pay per use business model and the tools to enable it. Later on they created a bunch of new business innovations like EverythingAAS. If those innovations don’t come into play, AWS isn’t more attractive than Hetzner. I’ve built and decommissioned smaller datacenters for different businesses a bit under 1MW. I’ve seen datacenters make no sense, I’ve seen datacenters make complete sense.

adrianN 4y ago

You'd be surprised how many restaurants base large parts of their menu on reselling pre-prepped food that they just throw in a deepfryer.