8 ms·
AWS claims its cloud faces competition from on-premises IT
- berkes 2y agoThis reeks of spinning a story by AWS in the hopes to avoid measures from anti-monopoly authorities. Off course a company will deny that they are a monopoly (or cartel etc). They'll keep pointing out their competition to these authorities. Ironically, the investor relations of such companies often point at the same data, to tell their investors how big their moat is and how insignificant their competion. I'll believe this change is really happening when AMZN starts reporting decline in their AWS gross returns. Is this declining?
- rapsey 2y agoIn what way is AWS a monopoly. They have a ton of competition in every aspect of their business.
- StableAlkyne 2y agoThe FTC is actively engaging in a monopoly case against Amazon: the organization whose job it is to break up monopolies certainly believes them to be one https://www.ftc.gov/news-events/news/press-releases/2023/09/ftc-sues-amazon-illegally-maintaining-monopoly-power https://www.ftc.gov/news-events/news/press-releases/2023/09/... Edit: Amazon, not AWS. Sorry for the confusion!
- rapsey 2y agoThe description on that page is entirely about the Amazon store business not AWS.
- StableAlkyne 2y agoOh hell, this is why posting after an overnighter is a bad idea
- deleted 2y ago[deleted]
- deleted 2y ago[deleted]
- alephnerd 2y agoPersonally, I agree with you. That said, the current argument is that because AWS is part of Amazon at large, it can gain undue advantage by being subsidized by other organizations in Amazon, and forgo profits in order to gain a controlling share in an industry. This is basically Lina Khan's whole argument [0] I personally don't subscribe to this argument as a major reason for AWS's dominance compared to Azure in the early 2010s was because of stronger execution (lots of training sessions, evangelization, some truly cutting edge architecture) and better product-market fit, but Hipster Anti-Trust assumes a bunch of smallish companies competing with each other can result in a similar outcome (hence why VCs like Thiel, Horowitz, and Andressen tended to support scholars affiliated to the New Brandeis Movement) [0] - https://www.yalelawjournal.org/pdf/e.710.Khan.805_zuvfyyeh.pdf https://www.yalelawjournal.org/pdf/e.710.Khan.805_zuvfyyeh.p...
- rapsey 2y agoBut you could say the exact same thing about Azure, GCP, Oracle cloud and others.
- alephnerd 2y agoHence why I said I personally don't agree with the New Brandeis Movement argument, and is something that Amazon's lawyers will absolutely bring up. Some of the more "fundamentalist" members of that movement want de facto single product companies, with little to no consolidation/M&A. Hypothetically good if you assume small players can compete optimally, but in action this absolutely means significant inefficiencies, at least in the tech industry because all small players inevitabely try to become large players in order to optimize on margins via economies of scale.
- ransom1538 2y agoLol. I hope this is sarcasm. They have zero competition and 100% lockins. I would say AWS is a national threat at this point.
- rapsey 2y agoTheir market share is 32%? Both Google Cloud and Azure are very large.
- ransom1538 2y agoNo, AWS market share is 99%. Go to any conference regarding cloud ever. Vendors just laugh at GCP, what a joke. Azure mayyybe 2%.
- rapsey 2y agohttps://www.hava.io/blog/2024-cloud-market-share-analysis-decoding-industry-leaders-and-trends https://www.hava.io/blog/2024-cloud-market-share-analysis-de...
- rickydroll 2y agoLook at market share and ease of switching cloud service providers. A rule of thumb is that if you own more than 50% and can dictate prices, you might be a monopoly.
- rapsey 2y agoThey own 32%
- squigz 2y agoSource, please?
- labcomputer 2y ago> A rule of thumb is that if you own more than 50% and can dictate prices, you might be a monopoly. I guess the UK has different laws, but here in the US it works like this: * 50% and below means you are definitely not a monopoly unless there is some weird set of facts than SCOTUS couldn't imagine the last time they considered monopolies. * At some threshold around 60-70% you might be a monopoly, but market share alone isn't enough to prove that. * Around 90% you are presumed to be a monopoly unless you can provide some very good evidence why you are not.
- berkes 2y agoThe cost of switching is just too high. This is true for their "competion" too. We can see this when researching the books as published to shareholders. When AWS was the "sole" player (first mover advantage) they had insane margins. Then competition stood up: GCP, Azure etc. And grew. Their margin has staid the same. And is roughly similar to that of GCP and Azure. Which means they either have secret gentlements agreement over pricing (highly illegal, not likely, the risk is just too high) or there's other mechanisms at play that allow them to keep dictating the price. Cost of switching is very likely such a mechanism. They lure you "on board" then once you start feeling the pain of the high margins, there's simply no way you can move to a competitor with lower margins - either that competitor isn't one really (Digital Ocean, OVH, Linode) or these competitors aren't competing on your margin (GCP, Azure) and have similar margins.
- berkes 2y agoThe parent article literally says > In a summary of evidence given to UK watchdog, the Competition and Markets Authority (CMA), AWS denies that customers face any difficulty in switching from its platform. This CMA was investigating amazon's possible monopoly on cloud. So, this whole thing started rolling exactly because authorities are asking the exact same questions as you "In what way is AWS a monopoly." and in doing so, see enough leads to at least ask for reports and AWS's reply.
- snapplebobapple 2y agoit's not, it's an oligopoly. In corporate it's basically them, microsoft, kind of google and then a tiny sliver of the market is filled with a whole bunch of wannabes.
- fallingknife 2y agoHaving a moat has nothing to do with anti-trust. A platform like AWS is incredibly difficult to switch off of regardless of market share.
- AmericanChopper 2y agoProduction workloads are incredibly difficult to move, regardless of location.
- berkes 2y agoIt does have overlap though. The article is about an anti-trust body researching whether that moat is not too much of a monopoly: > In a summary of evidence given to UK watchdog, the Competition and Markets Authority (CMA), AWS denies that customers face any difficulty in switching from its platform.
- robertlagrant 2y ago> I'll believe this change is really happening when AMZN starts reporting decline in their AWS gross returns. Is this declining? Declining revenues isn't the sign of not being a monopoly. How is AWS actually a monopoly?
- red-iron-pine 2y ago> How is AWS actually a monopoly? Like, is Azure not a thing? GCP? Hetzner? DigitalOcean? etc.
- berkes 2y agoThe parent article is about the CMA researching whether AWS is a monopoly and the answer to that from AWS. > Declining revenues isn't the sign of not being a monopoly. Thats a definition thing, though. Monopoly can mean a lot, depending on which side you are defending. In this case I meant that AWS had insane margins when they were the only player - first mover advantage etc. But those margins didn't decline when their "competition" started becoming serious. In fact, if you look at their shareholder reports, AWS, GCP, Azure etc all have similar margins now, and AWS's didn't decline. This tells us not if there's a monopoly. But it does tell us that there's no competion on margin/price. Bu, what I meant was that if "on prem is a true competitor to AWS" we'd see their gross profits decline, as people are moving off AWS. And if we don't see this happening, than it's not a true competitor.
- snapplebobapple 2y agoThis is just how antitrust works. The regulator defines a market, usually fairly reasonably, but sometimes incorrectly. Then the regulator points out you have massive market concentration and tries to do something about it. Then the company(ies) that hold that market power lie out their arse/otherwise creatively redefine the market so it looks like it's under a threshold that would require action. Then this goes round and round in the courts for years until someone gets fined, the regulator goes away and the guy who was leading the charge at the regulator gets a cushy job at the big co or related co or starts a law firm specializing in fighting against what he was previously fighting for.
- nubinetwork 2y agoI'm not sure I believe this... I haven't seen a sysadmin job around here for a couple years... (unless you count Montreal, but I'm not moving to Quebec...)
- 7bit 2y agoYou have not seen one? I assume the problem is you, then.
- notepad0x90 2y agoThe person you're replying to is responsible for what is posted on job boards/sites?
- antimemetics 2y agoI think the point they are making is there are plenty of jobs around for sys admin, but GP is not looking in the right places.
- 7bit 2y agoNo, but bro's trying to say that in a region with 100s of 1000s of people no one is looking for a sysadmin? That's like saying the sky isn't blue.
- notepad0x90 2y agoit happens, especially in September when budget is not plenty.
- misja111 2y agoIt is happening. Companies start to be more and more aware of the high cloud costs. Cloud is nice to spin up a project and have some elasticity in the performance requirements. But once it's running more stable and predictable it tends to be cheaper to have it running on premise.
- mcmcmc 2y ago
- motoboi 2y agoI suppose we had cloud long enough to allow for people that never had a datacenter think this is a good idea? I managed a tier 2 datacenter for some 4 years. Fire risk alone still gives me anxiety. “Cloud It’s more expensive stupid!” Yeah… you know what’s way more expensive? People. People and processes you’ll have to manage to achieve SLAs like Amazon’s? Well, good look with that. If you manage to find the people please write a book about how you achieved the process. Oh, and new services on top of that every time a new technology appears? With the SLA and the consistent quality? And the hardware, the building, the never ending decay of physical things. The drives for gods sake. The never ending pursuing of storage space. The enterprise premium for hardware, that you’ll pay to have the manufacturer saving your ass. And please don’t think your employees will let you touch the fancy open source or community versions of things. You’ll blink and you’ll be paying the premium (and thanking the vendor for the option), because the risk won’t let you sleep. And the most amazing part: business in you heels demanding innovation, quality, uptime and… change. Four years, 10 years ago and my palms just got sweat thinking about that. Your company is lucky that someone is willing to receive money to do that for you. And luckier yet that this company can do that very well. So well in fact that is very easy to forget how well they do that.
- kozikow 2y agoWhat do you think about product by Google - Google Distributed Cloud Air-Gapped? Although the name is "air gapped" - it does not have to be if client doesn't want air gapping. It's "buy commodity hardware from vendors HP, we will give you software and training to manage it". Much leaner stack than whole GCP/AWS/Azure, but deployed "on-prem" with "cloud-like" experience.
- flir 2y ago> I suppose we had cloud long enough to allow for people that never had a datacenter think this is a good idea? Centralization vs. Decentralization. And the pendulum swings on.
- motoboi 2y agoYeah. Also the young blood always assume the gray haired guys were just some kind of stupid and lame and simple couldn’t see how easy is to setup PHP with Linux on a commodity class hardware running somewhere in the basement.
- bananaquant 2y agoThat is fantastic news if true. AWS and two other major cloud providers have done everything in their power to make it painful for businesses to switch off of them. Case in point: egress data fees are something like 80x compared to what the cloud provider actually pays. You still have to pay them in full unless you decide to leave AWS completely.
- andrewstuart 2y agoCloudflare R2 - zero egress fees. IONOS Virtual Private Servers - $30/month - zero egress fees.
- bgidley 2y agoTry using Cloudflare R2 with zero egress and you'll rapidly discover there are lots of 'gotchas'... - Want to use a cloudflare managed domain - pay for egress if you have enterprise account - Want to use their 'dev' domain - rate limited It's still a good service - but zero egress comes with conditions. The only exception I've found is Cloudflare pages which seems genuinely zero egress (as long as you don't proxy it through a managed domain).
- matthewcford 2y agoI am curious why proxying it through a managed domain incurs additional costs.
- OptionOfT 2y agoBecause they can?
- andrewstuart 2y agoI don’t need those things. Sure it made me pay$5/month after some number of requests. I don’t expect to pay nothing. I just think 9 cents per GB for egress is robbery.
- fallingknife 2y ago
- october8140 2y agoCloudflare is the best and only thing I want to use.
- anothernewdude 2y agoHilarious. Didn't they just announce a return to the office? Now they're complaining?
- IX-103 2y agoYes, just like restaurants compete against home cooked meals.
- sergiotapia 2y agoThiel said that monopolies like to pretend they have stiff competition, and paradoxically small companies pretend they have monopolies. Which one do you think is true for amazon?
- rtpg 2y agoOxide already showing up and eating AWS's lunch I see. Seriously though, it does feel like above a certain company size you really do get into a position where, if you can hire the team to run it, on-prem just feels right. Especially if you're not even really in the "internet" business in the first place. Cloud is so costly!
- joshstrange 2y agoEvery once in a while I go drool over the Oxide server racks but I doubt I could afford one (or if I could I doubt I'd want to spend that much, and that's before needing to colocate it).
- zerop 2y agoAWS must provide ways to reduce the bill of customers. From experience, if AWS can tell customers what computes/capacity is not fully utilised and can be shutdown, it will help. I am not sure if it does in some form. Another thing would be customer definable cap on cost. Another pain points - Need to keep a DR region active all the time, fearing Data center/AZ outage.
- anshumankmr 2y agoIn Google you could make a kill switch that was however not real time. I feel something similar might be possible in AWS. However, the not being realtime might be a deal breaker for many.
- 123yawaworht456 2y agotime to hire a bunch of cloud ~~shills~~ evangelists again to concern troll about the hurdles of setting up a basic bitch VPS, pretending that it takes a cadre of highly-paid professionals do accomplish such monumental tasks
- kikimora 2y agoI don’t think anyone thinks that VPS is hard. Contrary, it seems universally acknowledged that VPS are way cheaper than cloud. Still people buy cloud for other reasons, good or bad. To me it is - Systems Manager: centralized access to servers with logging. - RDS: backups, replication, DMS, DB autoscaling with Aurora. - ECS: simpler k8s, autoscaling - CloudFormation, terraform, CDK and pulumi. - Lambda
- andrewstuart 2y agoThe next step after becoming very concerned about minimizing cloud costs is planning to leave.
- jcims 2y agoThey are not wrong. I’ve been in jobs with cloud platform responsibilities at large financials for the last nine years. With all of the regulatory oversight and internal controls, the all-in price for cloud is actually quite high and usually gives businesses pause when they start to realize that. Operating data centers is also incredibly expensive. The biggest costs come when you need to build new ones while maintaining what you have. The last place that I worked we spent several billion dollars in data center builds over the course of five years. Cloud was seen as a way to reduce the demand, but it takes a long time to build and mature a delivery platform that can run at reasonable velocity and adapt to business demands. Now regulators are really focused on concentration risks and are demanding multi-cloud architectures and are testing contingency plans in the event of massive failures on the part of service providers. This will in part drive a demand for reserve capacity in datacenters as well as build out of platform management capability that that can move workloads around without substantial incremental engineering work.
- TrueDuality 2y agoThere is definitely a specific monetary threshold where the financial justification flips and its probably around about $1 million/year of cloud costs if you need two region equivalent. This isn't "build a data center" kind of money, this is "rent some controlled racks and hire staff". You'll have to eat a good chunk of that operational savings over the time window with a big upfront capital hardware purchase. That being said, this reeks of making a anti-monopoly argument and seems wildly overstated.
- cooloo 2y agoOne word bull-shit
- grogers 2y agoTo be honest, whole foods and the go stores could be (at least in some small part) a way to shift their competition base from "online retail" to "all retail" for anti-trust purposes. I wonder if AWS outposts melding cloud to on-prem fulfill enough to be a similar premise of widening the span of competition.