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> WHY IN HELL IS EUROPE, WITH ITS INCREDIBLE AMOUNT OF AVAILABLE RESOURCES NOT DOING TH SAME?!? Probably because Euro is much more stable (relative to dollar)

> WHY IN HELL IS EUROPE, WITH ITS INCREDIBLE AMOUNT OF AVAILABLE RESOURCES NOT DOING TH SAME?!? Probably because Euro is much more stable (relative to dollar) than Naira (the official currency of Nigeria). So european companies don’t feel the need to compromise for an inferior service (this claim comes from the article linked in the OP, not from me) or bother creating their own one. If EU countries had an ongoing inflation rate of 30%+, which would result in GCP/AWS costs for european companies go up insanely every year (without GCP/AWS increasing pricing on their end and usage staying constant), I bet EU would consider switching to a cloud provider that accepts EUR instead of USD as well[0]. That’s not a good problem to have at all. 0. I have no idea if GCP/AWS accept payments in EUR. So that statement was written with a scenario in mind where GCP/AWS only accept USD (to draw an analogy with the situation in Nigeria).

Archelaos 3y ago
> If EU countries had an ongoing inflation rate of 30%+, which would result in GCP/AWS costs for european companies go up insanely every year Inflation would mean that the nominal revenues of EU companies would also increase to the same extent. Thus, the affordability of the foreign service would, ceteris paribus, remain the same.
- filoleg 3y ago
  > Inflation would mean that the nominal revenues of EU companies would also increase to the same extent. Only if their customers are not from EU (aka their customers pay in USD instead of EUR) or if the company increases pricing to match the inflation on a regular basis (while managing to not lose any customers). With the first scenario being a very specific edge case, and the second scenario being borderline impossible, I don’t see the inflation being a nothingburger here. Otherwise, the Nigerian companies wouldn’t care about the inflation either.
  - Archelaos 3y ago
    > Only if their customers are not from EU (aka their customers pay in USD instead of EUR) or if the company increases pricing to match the inflation on a regular basis (while managing to not lose any customers). Under standard conditions (nothing else then inflation matters), is the same for the domestic market. If we have x % yearly inflation, it means that the exchange rate at the end of the year is x % "higher", meaning the costs for the company are x % higher, but likewise the prices for companies's goods and services are x % higher and thus their revenues. So its profit margin (in percentage of its costs) remains the same. > Otherwise, the Nigerian companies wouldn’t care about the inflation either. The real problem is not inflation per se, but accelerated, unpredictable inflation. This ruins the exchange rates of a currency, as it is a risk that is not easy to manage. Due to these unfavourable exchange rates, companies from such countries are exposed to greater cost pressure when they purchase services in countries with a hard currency.

Archelaos 3y ago

> If EU countries had an ongoing inflation rate of 30%+, which would result in GCP/AWS costs for european companies go up insanely every year Inflation would mean that the nominal revenues of EU companies would also increase to the same extent. Thus, the affordability of the foreign service would, ceteris paribus, remain the same.

filoleg 3y ago
> Inflation would mean that the nominal revenues of EU companies would also increase to the same extent. Only if their customers are not from EU (aka their customers pay in USD instead of EUR) or if the company increases pricing to match the inflation on a regular basis (while managing to not lose any customers). With the first scenario being a very specific edge case, and the second scenario being borderline impossible, I don’t see the inflation being a nothingburger here. Otherwise, the Nigerian companies wouldn’t care about the inflation either.
- Archelaos 3y ago
  > Only if their customers are not from EU (aka their customers pay in USD instead of EUR) or if the company increases pricing to match the inflation on a regular basis (while managing to not lose any customers). Under standard conditions (nothing else then inflation matters), is the same for the domestic market. If we have x % yearly inflation, it means that the exchange rate at the end of the year is x % "higher", meaning the costs for the company are x % higher, but likewise the prices for companies's goods and services are x % higher and thus their revenues. So its profit margin (in percentage of its costs) remains the same. > Otherwise, the Nigerian companies wouldn’t care about the inflation either. The real problem is not inflation per se, but accelerated, unpredictable inflation. This ruins the exchange rates of a currency, as it is a risk that is not easy to manage. Due to these unfavourable exchange rates, companies from such countries are exposed to greater cost pressure when they purchase services in countries with a hard currency.