4 ms·

Oof. Curious to see Microsoft and Apple. I guess if you’re a Google investor you’ll be happy with cloud continuing to grow. Profitability is inevitable.

khazhoux 4y ago
> Profitability is inevitable. This comment is worth saving ;-)
- endisneigh 4y ago
  Heh, I got that reference.
oars 4y ago
RemindMe! 1 year
gsanderson 4y ago
Microsoft was a small beat but the stock's currently down, presumably on the slower growth in Azure.
- teepo 4y ago
  The read I have is more around PC sales declining. Cloud still has good margins across the big 5. GCP is a quarter or so away from profitability after the massive build outs and Azure has probably the largest GP right now of the hyperscalers.
anonporridge 4y ago
> Profitability is inevitable. Unless the rise of many viable competitors drives cloud computing down to a commodity service with razor thin margins. There's no guarantee that the AWS gravy chain is going to materialize for other companies.
- paxys 4y ago
  Commodities can still be expensive and profitable. Yes it is easier than ever for a company to get into cloud computing, but despite the increased competition retail prices are going up the entire sector is making more money than ever.
- hotpotamus 4y ago
  The game seems to be to keep IaaS pricing high and tell people that use it that they're doing it wrong, they need to use our cloud-native offerings which will indeed lower their spend but increase lock-in. I suppose the counter to that is Kubernetes and other cloud-native-like abstractions on top of commodity IaaS so at least you can somewhat easily move between cloud providers and seek better pricing. From what I can tell it's a cat and mouse game of who can lock-in and who can abstract away, and I assume it's been going on for longer than I've been at this.
- crazygringo 4y ago
  But we're not seeing that happen, because the initial capital outlay to build a cloud platform is absurdly large. Google has been at this for a decade and is only now at the cusp of profitability. With a barrier to entry this high, and vendor lock-in so strong, you can be sure all big 3 cloud services are going to be minting money for many years to come.
  - peanuty1 4y ago
    There are quite a few players though. In addition to AWS and Azure, there's also Oracle and IBM.
    - crazygringo 4y ago
      Does anybody really use those for generic cloud projects though? My impression was that those were geared towards firms who have already bought heavily into the Oracle/IBM consulting/licensing. They're not clouds where Netflix or Spotify are going to spin up a few thousand servers. Unless I've been misinformed? So they don't really seem to be in the same category. I mean is anyone not already in the IBM ecosystem ever choosing between AWS and IBM?
time_to_smile 4y ago
> Profitability is inevitable. Cloud computing profit is largely driven by companies that don't make profit themselves. If we end up with a major tech crunch, which I suspect we will, and a bunch of these big, non-profitable new tech startups/IPOs start to fold, we'll see a massive and rapid contraction in the cloud space. The last 3 companies I worked at invested very heavily in cloud infrastructure but none of them has made a profit. There's a pretty good chance if you're on HN the same is true for your company.

khazhoux 4y ago

> Profitability is inevitable. This comment is worth saving ;-)

endisneigh 4y ago
Heh, I got that reference.

oars 4y ago

RemindMe! 1 year

gsanderson 4y ago

Microsoft was a small beat but the stock's currently down, presumably on the slower growth in Azure.

teepo 4y ago
The read I have is more around PC sales declining. Cloud still has good margins across the big 5. GCP is a quarter or so away from profitability after the massive build outs and Azure has probably the largest GP right now of the hyperscalers.

anonporridge 4y ago

> Profitability is inevitable. Unless the rise of many viable competitors drives cloud computing down to a commodity service with razor thin margins. There's no guarantee that the AWS gravy chain is going to materialize for other companies.

paxys 4y ago
Commodities can still be expensive and profitable. Yes it is easier than ever for a company to get into cloud computing, but despite the increased competition retail prices are going up the entire sector is making more money than ever.
hotpotamus 4y ago
The game seems to be to keep IaaS pricing high and tell people that use it that they're doing it wrong, they need to use our cloud-native offerings which will indeed lower their spend but increase lock-in. I suppose the counter to that is Kubernetes and other cloud-native-like abstractions on top of commodity IaaS so at least you can somewhat easily move between cloud providers and seek better pricing. From what I can tell it's a cat and mouse game of who can lock-in and who can abstract away, and I assume it's been going on for longer than I've been at this.
crazygringo 4y ago
But we're not seeing that happen, because the initial capital outlay to build a cloud platform is absurdly large. Google has been at this for a decade and is only now at the cusp of profitability. With a barrier to entry this high, and vendor lock-in so strong, you can be sure all big 3 cloud services are going to be minting money for many years to come.
- peanuty1 4y ago
  There are quite a few players though. In addition to AWS and Azure, there's also Oracle and IBM.
  - crazygringo 4y ago
    Does anybody really use those for generic cloud projects though? My impression was that those were geared towards firms who have already bought heavily into the Oracle/IBM consulting/licensing. They're not clouds where Netflix or Spotify are going to spin up a few thousand servers. Unless I've been misinformed? So they don't really seem to be in the same category. I mean is anyone not already in the IBM ecosystem ever choosing between AWS and IBM?

time_to_smile 4y ago

> Profitability is inevitable. Cloud computing profit is largely driven by companies that don't make profit themselves. If we end up with a major tech crunch, which I suspect we will, and a bunch of these big, non-profitable new tech startups/IPOs start to fold, we'll see a massive and rapid contraction in the cloud space. The last 3 companies I worked at invested very heavily in cloud infrastructure but none of them has made a profit. There's a pretty good chance if you're on HN the same is true for your company.