8 ms·
Ofcom proposes to refer UK cloud market for investigation
- ibnbutlAn 4y agoI wonder if the UK situation is worse/better than the rest of Europe here. At least there are Hertzner and OVH, but not sure if they are remotely comparable to AWS et al.
- hkt 4y agoThey're not really comparable with AWS as a whole. They certainly compare with EC2, but as far as I know neither OVH nor Hetzner have anything comparable to say, IAM. It is the pre-cloud roll-your-own-in-a-dc thing and it isn't the same proposition if you're a business.
- dustedcodes 4y agoHetzner is at best comparable to the very first version of AWS, but since then the "traditional" cloud has moved on. Hetzner is basically old school (I guess we can call this model old school now?) IaaS, whereas AWS, Azure and GCP are mostly PaaS now. At Hetzner you think about what infrastructure you need, at traditional cloud providers people don't think about infrastructure that much anymore and rather think about what ready made products they need.
- miohtama 4y agoIn AWS, you are not paying for CPU, you are paying for everything else (CPU probably sold on loss) - Slighty modified open source infrastructure applications (PostgreSQL, etc.) - Access management - Brand - Fancy deployment scripting (needed when > 15 VMs) - egress cost (as mentioned in the article) If you do not any of the above, you can roll out your own Redis and PSQL, or use a third party provider, Hetzner is often much better deal.
- porker 4y agoI don't know much about the situation in Europe, but in the UK once you move beyond the international cloud players most of our hosting is now owned by big conglomerates. The smaller companies have been bought up by iONOS, team.blue, HostEurope and others I can't recall. They're not comparable to AWS but it has reduced choice and IMO customer support, as each individual company is cost-optimised into a brand and the actual hosting moved to the parent company's infrastructure.
- gnufx 4y agoAt least, post-Bytemark, there's still Mythic Beasts.
- hkt 4y agoTitle could probably end in "by CMA" to indicate competition concerns rather than eg criminal investigations. Also, this is excellent and way past time. I'd love to see some movement here that would allow some competitors into the market that would be more wholesome than the usual field of american monsters.
- deleted 4y ago[deleted]
- zhte415 4y agoResponses to the consultation for investigation are linked here: https://www.ofcom.org.uk/consultations-and-statements/category-2/cloud-services-market-study?showall=1 https://www.ofcom.org.uk/consultations-and-statements/catego...
- YawningAngel 4y ago> Technical restrictions on interoperability. These are imposed by the leading firms that prevent some of their services working effectively with services from other providers. This means customers need to put additional effort into reconfiguring their data and applications to work across different clouds. I'm not sure what they mean by this, anyone care to speculate?
- reset-password 4y agoSounds like a fancy way of saying vendor lock-in
- miohtama 4y agoMicrosoft would never do vendor lock-in (:
- hkt 4y agoI'd guess that migrating from any of the local cloud DB variations (Aurora say) is unduly hard once you've migrated to it. But that's just a guess. It is certainly a PITA to migrate, I know that for sure.
- YawningAngel 4y agoI agree with that, but given that a lot of the DBs on AWS and Azure are proprietary software (eg Cosmos and DDB) I'm not sure what ofcom proposes doing about that.
- WastingMyTime89 4y agoThey don’t propose to do anything. They don’t even say that this feature in particular is illegal. They merely say that after doing a market study, they noticed that: egress fees are significant, technical barriers to interoperability are in place and the discount structure based on committed spending is suspicious. From their point of view, that warrants an actual full investigation by the Competition and Markets Authority.
- cntainer 4y agoJust another example that a free market does not always ensure healthy competition and some times intervention is needed to level the playing field.
- qeternity 4y agoI say this as someone who only uses AWS for DR backups: hosting infra is one of the most competitive industries out there. Major cloud costs are exorbitant but that should be interpreted as proof of a great product. I shudder at paying 9c/gb egress but apparently many others do not.
- vidarh 4y agoSame. I use Hetzner and DigitalOcean for my own stuff, and shudder at AWS costs. At the same time both my current and previous employers use AWS and it's fine for their user because revenue is (very) high relative to the cloud resource usage, and that is a situation where cloud usage is fine. But so many - B2C in particular - businesses who uses cloud have tight enough margins that they're just setting themselves up for being disrupted by a competitor with tighter cost control.
- cntainer 4y agoThe magic of cloud is how quickly you can scale things up. If you're a new fast growing business it will give you a competitive edge. If you drank to cloud kool-aid from the beginning you kind of get used to huge costs for simple services so it's easier for your brain to justify paying 10k a month for a simple web app deployed in kubernetes, using cosmos db and any other number of services. I've seen many companies that started on the cloud and their core architecture is so interleaved with the cloud that it would a huge investment to reduce that dependency and switch.
- oarsinsync 4y ago> The magic of cloud is how quickly you can scale things up I see this spouted a lot, but my recent (last 6 months?) experience with AWS is that unless I pay up front to reserve a tonne of high end instances that I don’t necessarily need today, but might need tomorrow, I’m regularly running into capacity issues where I cannot spin up new instances of the metal that I want, and AWS support confirms they just don’t have the capacity unless we pay to reserve it up front. At that point, it’s no different to running my own DC, where I already have 3 months of runway on my server pipeline anyway.
- Moissanite 4y agoAWS and Azure should both be separated from their parent companies. That would end a lot of the hand-wringing about Amazon competing with its retail customers, and would force Microsoft to stop it's anticompetitive license bundling shenanigans. GCP can follow in a few years, if they survive that long.
- zamnos 4y agoIt's unclear if the accounting Microsoft is using to account for Azure is actually valid. Apparently a lot of Office revenue is being stuffed under the Azure division to inflate its numbers to make them look bigger than Google.
- 867-5309 4y agodoes google not do the same with their office products?
- was_a_dev 4y agoMy assumption would be the revenue from Microsofts office products to be at least an order of magnitude larger than Google's Just my assumption however
- disgruntledphd2 4y agoThey do, but they only started doing that after Microsoft did it. To be fair to Google, they have a lot less experience with managing Wall Street through tactical use of accounting standards.
- joahua 4y agoTrue… and in practice how do you do anything without Azure AD? If all the juicy stuff is stored in 365 and therefore warrants P2 or E5 bundling, is it possible to unscramble the revenue egg? If they can tease identity out, the rest gets easier.
- robertlagrant 4y ago
- samwillis 4y agoIf this is anything like the investigations into Mobile Browsers and Gaming I'm sure it will be shut down due to technicalities. See: https://theplatformlaw.blog/2023/04/04/into-uncharted-waters-making-sense-of-the-cats-apple-cma-judgment/ https://theplatformlaw.blog/2023/04/04/into-uncharted-waters... The one into online advertising also went nowhere: https://www.gov.uk/cma-cases/online-platforms-and-digital-advertising-market-study https://www.gov.uk/cma-cases/online-platforms-and-digital-ad... I don't hold out much hope.
- sour-taste 4y agoThis is wild reading. The UK has tied its own hands in its ability to police these practices? This smells like a case where some pro-corporation lawyer wrote the original rules and put in a bunch of pointless constraints to make the process as difficult and cumbersome for the government as possible. For one thing the study period is 18 months? That seems like way too long. And all the procedural hurdles just seem busted. God I feel bad for the people working on this it's pretty obvious they'll never be able to overcome these barriers.
- jwmoz 4y agoThey need to get the costs down. Unless you are big business or startup with funding, most cloud services are insanely priced. I was looking at Google the other day at some training, just wondered how much something like the API gateway cost and it was £12k for average use.
- KyeRussell 4y agoI’ve worked in a digital agency running out of an old barn out the back of a house, and a completely bootstrapped 4 person small business making a software product, and in both cases our AWS spend was absolutely negligible compared to say….salaries. Nothing insane about that.
- jimnotgym 4y agoIt depends what you are using. I have seen the bill spiral after some innocuous sounding add ons. Add an apple server or thier managed ftp and start scaring yourself
- oriettaxx 4y agoit's about time!
- gnufx 4y agoBeing 90% better value is achieved in part by not having to fund our own space programme. — https://www.mythic-beasts.com/blog/2021/10/06/improving-the-world-bit-by-expensive-bit/ https://www.mythic-beasts.com/blog/2021/10/06/improving-the-...
- londons_explore 4y agoLet's think potential remedies. Suggest possible ideas in this thread!
- londons_explore 4y agoI'd like to see them require cloud providers price network ingress and egress to a competitor the same as network ingress/egress to another service of the same provider. Eg. an AWS VM reading data from DynamoDB should cost the same per gigabyte than an AWS VM reading data from Google Bigtable. Either they need to start accounting for bandwidth between services, or stop charging for bandwidth to competitors.
- londons_explore 4y agoFrom a logistical point of view, this is hard. For a provider, bandwidth within their datacenter from one service to another is very cheap (and hence why they don't charge for it). Yet bandwidth to a competitor 200 miles away is far more constrained. As well as costing more, it simply isn't practical to have a fleet of 10,000 VM's all booting up using remote disks 200 miles away in a competitors datacenter which only has two 100Gbps direct network links shared between all customers.
- londons_explore 4y agoThe regulator could define each service offered as either "interoperable" or "non interoperable". An interoperable service is one where a largely identical and technically compatible service is available as open source code or from many competitors. For example kubernetes (Kubernetes opensource, Amazon EKS, Microsoft AKS). Non interoperable services would have a 25% revenue tax applied if they have more than a 10% market share and are run by a company with a revenue over $10M/yr.
- pc_edwin 4y agoThis is exactly the type of intervention that crippled Europe's tech ecosystem. The cloud market is one of the most competitive in tech, with numerous strong and emerging players. In addition to established giants such as AWS, Azure, and GCP, there are also healthy second-tier players such as Cloudflare, Akamai, and Digital Ocean. I can also list more than a dozen new startups in the space that got money thrown at them. Furthermore, it's important to recognise that cloud companies struggle to lock in because of the competitive dynamics at play. You have 2 levers to pull, money and tech lock-in. You can't go far with money without quickly reaching diminishing returns. At the core you have compute, databases and object storage. All off these have been abstracted to a point where its very tricky to create lock-in without creating strong adverse reactions from customers. As someone who has been closely observing the industry for almost a decade, I have noticed a strong trend towards reduced lock-in.
- amluto 4y agoI’ll quote directly from the article: > High fees for transferring data out, committed spend discounts and technical restrictions are making it difficult for business customers to switch cloud provider or use multiple providers The technical restrictions are, as you say, not clearly creating lock-in. The committed spend discounts seem like a gray area. But the egress fees are no joke, and I consider them extremely anti-competitive.
- quesomaster9000 4y agoI don't see how committed spend discounts are different from contractual B2B pricing in every other industry. I can also see why egress bandwidth can be expensive for e.g. server farms, the contention ratio is (usually) significantly higher than it is for ingress. How would you propose PAYG/SaaS bandwidth pricing is altered to be more competitive, or for example Amazon Glacier retrieval is heinously expensive for retrieval but it's transparent and IMO has a fair reflection of the underlying costs involved.
- amluto 4y agoI won’t argue with Glacier retrieval costs, although I don’t really believe they reflect actual costs. But I will argue with egress. AWS and its friends charge absolutely outrageous amounts for egress: https://blog.cloudflare.com/aws-egregious-egress/ https://blog.cloudflare.com/aws-egregious-egress/ And the fact that they have made no move to reduce pricing to compete with R2 suggests that they are not actually motivated by making a profit on egress. I strongly suspect that they are motivated by lock-in: AWS wants you to minimize egress costs my moving more services into AWS. And this includes third-party services. In a competitive market, services like Crunchy Data, Pinecone, and Snowflake would ordinarily be hosted in their own datacenters or in colocation facilities, and customers would pay a hefty premium to use an AWS, Google or Azure version. But, since egress fees mean that a non-big-cloud variant can’t possibly be cost-effective for customers, these services don’t bother to offer. (And they can’t even be usefully competitive across clouds. If Azure wants to attract companies like Snowflake, reducing the amount they charge for storage and compute is entirely useless.) I don’t know how to regulate this properly, but a price cap at some low (and ever-falling) figure wouldn’t be so horrible. Or requiring that egress be billed at the same rate as local traffic. (Although 100Gbps of same-rack traffic is cheap, whereas 100Gbps of egress is genuinely fairly expensive.) As an aside: having recently priced Glacier vs commodity hardware, Glacier is reasonably priced for monthly storage but not particularly cheap. I suspect it exists in part to make customers feel better about moving large amounts of data into the cloud. AWS could likely still make a profit on it if the retrieval fee were decreased by a factor of 10. If I wanted to store a few hundred TB and access it a couple times a year, especially if that access is from outside AWS, then storing an on-prem copy is less expensive, and the best option may be an on-prem copy plus an archive in Glacier for disaster recovery.