> 1. AWS saves us money despite the apparent higher costs because our developers spend more time working on our core business than managing infrastructure, and developer time is our most expensive resource.
But in most cases you lose any preserved savings because of the very ease of use and lack of needing to think about the infrastructure management. This is because more often than not problems are solved by just adding another instance, vs actually solving the larger problem.
Also, I would say part of the core business is providing the server, not simply writing the software that is the interface to the service being provided to the end users. E.G. Keeping servers up and and the right number of them in operating is just as important to the core of the business as writing the software / website of the service you are intending on providing. Outsourcing that a 3rd party removes your ability for you to control the entire service that you intend on providing, it is left in the hands of somebody else who may not be aligned to your business needs.
> 2. Softlayer completely f'ed us twice now with down time resulting in a substantial dollar loss.
AWS has f'ed near half the internet before, and probably will do so again.
Service outages are shitty, I get it, but my suggestion for Softlayer was just that, there are others, and my favorite is actually colo with everybody else's cheap EOL servers.
As a anatotal I have seen far to many projects move from bare metal, to AWS or the likes who at a minimum tripple the running cost for less performance. You could say the engineers suck, but I thought they were going to get to spend more time working on core business?
I have ran the numbers many time myself and I can't support AWS for anything other than bootstrapping a well funded startup. After that if you want to lower your cost you are either going to have to jump through hoops and formulate your service to use the cheapest parts all while not focusing on the busness but trying to get that AWS bill down.
Does part of your core business also involve mining silicon, crystalizing it, cutting the crystals into wafers, and then etching those wafers to make the chips your servers are built from?
Somewhere, you're drawing the line between what you build in-house and what you outsource. Where to draw the line depends on many factors. There's definitely no "right" place, such as never using cloud resources.
Vertical integration is function of size. At scale even the small efficiency improvements can make big differences, Facebook run their own DCs and design some hardware too coz it probably makes sense at their scale.
Vertical integration is a function of size and other variables.
For example, I used to work for a solar power company that would install panels on the roofs of big box stores and then sell the power to the stores below grid prices. This company did not manufacture panels -- they bought them at market rate from various suppliers.
The company got acquired by a major silicon wafer manufacturer. One of the things this wafer company made were solar panels -- boom, vertical integration. What a win, right? Well, as it turned out, after about a year, their competitors were able to bring their panel prices down whereas the acquiring company moved a bit more slowly. Thus the wafer company became an albatross around the solar power company's neck. They had to use the parent company's panels, instead of their more cost-effective competitors, and ended up no longer being competitive in the market.
So vertical integration can and often does make sense, but it comes with a loss of agility, and sometimes being nimble is more important.
While there are no fairy tale solutions . Vertical integration gives lot more control which can give gain competitive advantage if done correctly either by doing it cheaper or adding features your competiton cannot
In your ancedote the buying company seems to be benefit with increased sales for a non competitive product. Ofcourse they are doing at the expense of the eroding target , but they are deriving value not the way you see it perhaps or the best possible one but value nonetheless.
> 1. AWS saves us money despite the apparent higher costs because our developers spend more time working on our core business than managing infrastructure, and developer time is our most expensive resource.
But in most cases you lose any preserved savings because of the very ease of use and lack of needing to think about the infrastructure management. This is because more often than not problems are solved by just adding another instance, vs actually solving the larger problem.
Also, I would say part of the core business is providing the server, not simply writing the software that is the interface to the service being provided to the end users. E.G. Keeping servers up and and the right number of them in operating is just as important to the core of the business as writing the software / website of the service you are intending on providing. Outsourcing that a 3rd party removes your ability for you to control the entire service that you intend on providing, it is left in the hands of somebody else who may not be aligned to your business needs.
> 2. Softlayer completely f'ed us twice now with down time resulting in a substantial dollar loss.
AWS has f'ed near half the internet before, and probably will do so again.
Service outages are shitty, I get it, but my suggestion for Softlayer was just that, there are others, and my favorite is actually colo with everybody else's cheap EOL servers.
As a anatotal I have seen far to many projects move from bare metal, to AWS or the likes who at a minimum tripple the running cost for less performance. You could say the engineers suck, but I thought they were going to get to spend more time working on core business?
I have ran the numbers many time myself and I can't support AWS for anything other than bootstrapping a well funded startup. After that if you want to lower your cost you are either going to have to jump through hoops and formulate your service to use the cheapest parts all while not focusing on the busness but trying to get that AWS bill down.