back to article Google network lord questions cloud economics

Vijay Gill — one of the brains that oversees Google's epic internal network — has questioned the economics of so-called cloud computing. Or least, the sort of cloud computing practiced by Amazon.com, whose EC2 service offers up instant access to compute power via the interwebs. If your infrastructure is in use around the clock, …

COMMENTS

This topic is closed for new posts.
  1. lamont

    Good article

    Anther savings is that if you're using Amazon you're stuck with a few different memory sizes of virts that you can get from EC2: 1.7GB, 7.5GB, 15GB, etc. If you need a bunch of 4GB virts then you're stuck buying 7.5GB RAM servers and trying to politically deal with bundling up apps on the same O/S instance, or else just wasting RAM.

    You'll get better "compression" by being able to size the virts yourself by running your own internal cloud.

    I've also been doing these calculations repeatedly because our board of directors seems to be infected with irrational lust for the cloud, and keep on determining that break-even on a cash-flow basis comes after about 3-4 months for 100% duty cycle instances -- so Vijay is probably being conservative at what can be achieved in the real world.

    However, if your IT department spends millions on expensive enterprise-class tools and money is flying out the door to VMware, EMC, NetQOS and every other IT vendor out there, then it may be cheaper to go with the cloud -- but in going with the cloud you are getting Amazon's framework build on top of Xen and open source or in-house tools. You are not getting infrastructure engineered to "five 9's" you are getting infrastructure engineered to "you bet it'll fail -- so spin up another one!"

    If you run the numbers on cloud and find that it makes economic sense, you should fire your IT staff and start over from scratch with people who understand cheap open source.

  2. Anonymous Coward
    Welcome

    Welcome

    Welcome to 1970.

    You can either pay a bureau and they own the overheads, shared across multiple customers not just you, but you still carry the risk and the responsibility when it doesn't work as intended.

    Or you can put a PC on every desk, and pay way over the odds for the compute power and storage which sits idle for 99% of the time, and pretty software which is defective by design.

    Or you can take control, do most of it in house, as far as possible with free software, and know exactly what you're getting for your money and maybe be able to fix it when it misbehaves.

    Stuck in a time loop...

  3. Christopher.
    Stop

    Using "reserved instances" totally changes things

    As you say: "the Google man uses Amazon's standard pricing for instances, rather than its reserved pricing."

    There's a *vast* difference between those prices.

    $0.68 per hour without reserving an instance,

    $0.24 per hour when you reserve an instance (for a $2800 once-every-three-years reservation fee).

    This knocks the monthly price down from $118k to under $55k.

  4. Gabriele Bozzi
    Paris Hilton

    PFFF...

    ...I can't disagree with Mr. Gill more.

    Modern data-centers use elastic computing and dynamic machine provisioning already, either on premise or on the public cloud. The simulation Mr. Gill is proposing is dense nonsense.

    Of course this is about bashing AWS IaaS approach and promoting Google PaaS offering.

    How much of one's reputation can be thrown to pigs and dogs to support marketing strategy?

    No, I don't want to know, actually...

    Paris because she has a reputation.

  5. Chris_Maresca

    Is this really a surprise?

    Anyone who's run the numbers on on-demand computing vs rolling your own knows that it's much cheaper to roll your own. The only place where on demand is cheaper is for bursted capacity... Yeah, people argue about staff overhead, but it's not like running on cloud services frees you to have no staff.

    I guess the real problem is that people don't actually calculate the cost of things....

    Chris.

  6. Henry Wertz 1 Gold badge

    i think it makes sense...

    economically that amazon will price things so what they charge pays the bills *and* turns them a profit. So, they have large economies of scale, but at some point it must be cheaper to keep everything in house, or at least keep most in house and rent ec2 time for demand spikes.

  7. heyrick Silver badge

    Way over my head...

    ...I can't imagine these sorts of server setups, never mind know enough to think of maintaining them, however it seems to me that this comparison sits on a raw cost for bandwidth heavy services while glossing over a few small things - reliability (what's the uptime?), security (unauthorised people can't access the data, and if they do damage will be minimal), and integrity (are full backups taken? how often? how many are archived? are these backups actually tested?).

  8. Anton Ivanov
    Flame

    Statement of the bleeding obvious

    Of course Amazon does not make financial sense if you run it flat out. Same numbers for 10 or 1% utilisation are hugely in Amazon's favour. 10% is a dream come true for a small or medium business e-commerce front-end. 1% is more like it.

    From that perspective Amazon is actually very fit for service.

  9. jonathanb Silver badge

    Kind of makes sense

    If you are using the machines 100%/24/7, your costs of running them are going to be pretty much the same as Amazon's costs + Amazon needs to make a profit out of it, and Amazon prices on the assumption that they aren't going to get 100% utilisation of the machine - they need to have spare machines available at a moments notice for anyone who wants them. The whole point of the set up is that you can share the cost of running the machine with other people who might want it when you don't. If you are not sharing, there is no point in going to Amazon.

  10. Rogerborg

    But this duty cycle goes to 111%

    What happens when you need *more* cycles that you have available in-house? When you get Dugg or Slashdotted, serving 404s is throwing away your one chance to cash in.

  11. Sirius Lee

    As an EC2 user...

    I work with a small software company which uses EC2. Of course when you look at the numbers for hardware and bandwidth its much cheaper to have hardware in-house.

    But hardware and bandwidth are the cheap elements. Much more expensive is the cost of staff to maintain that hardware/infrastructure. If you're part of a bigger company or if you already have the expertise needed to maintain the infrastructure, ensure your ISP always provides adequate bandwidth at edge locations, have the reserve capacity in the event of failure, the storage available to backup, etc. then Amazon might not be cost effective. For us, even without taking into account the reduced pricing of reserved instances the question is never EC2 or in-house its EC2 or some other equivalent service.

    Even if a company does have the required expertise in-house its going to be worth re-considering the economics. Economists tell businesses they have to focus on their core competency and out-source other tasks where possible even if the business would be better at that out-sourced task because it means the business can focus on doing even more of what they are expert at. This is especially true for small companies like ours where there's a tendancy to do everything. In our case running a data center is non-core so we out-source it to Amazon.

    Of course the economists logic is fuzzy at the edges. We have to have some in-house capability. But we are limiting that to a Windows 2008 domain server (and backup), test rigs and staff machine maintenance. However our core compentence requires we understand Microsoft's server and desktop OSs.

  12. Bram

    a lot more to factor

    Going on just the information in the article, did they factor in all the indirect overheads like insurance on the equipment, physical security, desks and all that sort of crap.

    Most businesses want to run a business and not a data centre, getting into the whole do it yourself IT thing tends to distract the organisation from their core focus.

  13. Anonymous Coward
    Stop

    tied to resources

    the calculations also split the cost of the physical kit over a 3 year cycle... that ties you to capital expenditure and maintainance costs for those 3 years...by the 3rd year you're replacing the kit? thats then an ongoing issue...as all of us with large data centres already know.

    no, the Amazon model is compelling - but, as pointed out elsewhere in this thread - can be done cheaper in-house and with hosting partnerships.

  14. Anonymous Coward
    Anonymous Coward

    Software licenses

    I believe one factor in cost that isn't consider is the cost of the cloud sofware license to support your own cloud computing compared to Amazon. Can anyone elaborate on the cost of VMWare vsphere and its tools?

  15. LarryInTheCloud
    Alert

    EC2 isn't as great as it sounds

    Personally - I think EC2 hype is blown WAY out of proportion. I read all the time that people flock to EC2 like lemmings thinking it is the most cost effective cloud platform out there. I happen to know from experience it certainly isn't the most friendly to use. To the "Google Man's" point, whether you agree with him or not, EC2 isn't the end all be all of cloud platforms. I found this 30,000 foot comparison matrix of the largest cloud platform providers that shows there are many things to consider when factoring cost and eventually adoption to the cloud. Just sayin'....

    www.skytap.com/compare-skytap-aws-ec2-microsoft-azure-and-rackspace/index.php

  16. James 100
    FAIL

    Duff numbers, fatally flawed assumptions

    So, his cost figures are completely wrong (using the per-hour pricing for EC2 against long-term commitment pricing for the colo option), his assumption of 100% usage for any Internet situation is nothing short of absurd when even mainframe shops with pre-planned predictable batch workloads don't come close, and he's missed out the whole "elastic" bit of the elastic compute cloud. Apart from that, nice try.

    For the real world, on the other hand, instead of paying for, say, ten colocated servers and bandwidth constantly and getting hammered by the odd traffic spike, I can pay less money per server to have six servers handling routine traffic - and crank up to 20 servers at a minute's notice for the busiest couple of hours, so I'm providing a much better service to customers for less money.

    What next, Gilette blogging that it's worse for you to drop a mains-powered electric shaver in your bath than a manual blade razor!?

This topic is closed for new posts.

Other stories you might like

  • Google recasts Anthos with hitch to AWS Outposts
    If at first you don't succeed, change names and try again

    Google Cloud's Anthos on-prem platform is getting a new home under the search giant’s recently announced Google Distributed Cloud (GDC) portfolio, where it will live on as a software-based competitor to AWS Outposts and Microsoft Azure Stack.

    Introduced last fall, GDC enables customers to deploy managed servers and software in private datacenters and at communication service provider or on the edge.

    Its latest update sees Google reposition Anthos on-prem, introduced back in 2020, as the bring-your-own-server edition of GDC. Using the service, customers can extend Google Cloud-style management and services to applications running on-prem.

    Continue reading
  • Google has more reasons why it doesn't like antitrust law that affects Google
    It'll ruin Gmail, claims web ads giant

    Google has a fresh list of reasons why it opposes tech antitrust legislation making its way through Congress but, like others who've expressed discontent, the ad giant's complaints leave out mention of portions of the proposed law that address said gripes.

    The law bill in question is S.2992, the Senate version of the American Innovation and Choice Online Act (AICOA), which is closer than ever to getting votes in the House and Senate, which could see it advanced to President Biden's desk.

    AICOA prohibits tech companies above a certain size from favoring their own products and services over their competitors. It applies to businesses considered "critical trading partners," meaning the company controls access to a platform through which business users reach their customers. Google, Apple, Amazon, and Meta in one way or another seemingly fall under the scope of this US legislation. 

    Continue reading
  • I was fired for blowing the whistle on cult's status in Google unit, says contractor
    The internet giant, a doomsday religious sect, and a lawsuit in Silicon Valley

    A former Google video producer has sued the internet giant alleging he was unfairly fired for blowing the whistle on a religious sect that had all but taken over his business unit. 

    The lawsuit demands a jury trial and financial restitution for "religious discrimination, wrongful termination, retaliation and related causes of action." It alleges Peter Lubbers, director of the Google Developer Studio (GDS) film group in which 34-year-old plaintiff Kevin Lloyd worked, is not only a member of The Fellowship of Friends, the exec was influential in growing the studio into a team that, in essence, funneled money back to the fellowship.

    In his complaint [PDF], filed in a California Superior Court in Silicon Valley, Lloyd lays down a case that he was fired for expressing concerns over the fellowship's influence at Google, specifically in the GDS. When these concerns were reported to a manager, Lloyd was told to drop the issue or risk losing his job, it is claimed. 

    Continue reading
  • End of the road for biz living off free G Suite legacy edition
    Firms accustomed to freebies miffed that web giant's largess doesn't last

    After offering free G Suite apps for more than a decade, Google next week plans to discontinue its legacy service – which hasn't been offered to new customers since 2012 – and force business users to transition to a paid subscription for the service's successor, Google Workspace.

    "For businesses, the G Suite legacy free edition will no longer be available after June 27, 2022," Google explains in its support document. "Your account will be automatically transitioned to a paid Google Workspace subscription where we continue to deliver new capabilities to help businesses transform the way they work."

    Small business owners who have relied on the G Suite legacy free edition aren't thrilled that they will have to pay for Workspace or migrate to a rival like Microsoft, which happens to be actively encouraging defectors. As noted by The New York Times on Monday, the approaching deadline has elicited complaints from small firms that bet on Google's cloud productivity apps in the 2006-2012 period and have enjoyed the lack of billing since then.

    Continue reading
  • Makers of ad blockers and browser privacy extensions fear the end is near
    Overhaul of Chrome add-ons set for January, Google says it's for all our own good

    Special report Seven months from now, assuming all goes as planned, Google Chrome will drop support for its legacy extension platform, known as Manifest v2 (Mv2). This is significant if you use a browser extension to, for instance, filter out certain kinds of content and safeguard your privacy.

    Google's Chrome Web Store is supposed to stop accepting Mv2 extension submissions sometime this month. As of January 2023, Chrome will stop running extensions created using Mv2, with limited exceptions for enterprise versions of Chrome operating under corporate policy. And by June 2023, even enterprise versions of Chrome will prevent Mv2 extensions from running.

    The anticipated result will be fewer extensions and less innovation, according to several extension developers.

    Continue reading
  • It's a crime to use Google Analytics, watchdog tells Italian website
    Because data flows into the United States, not because of that user interface

    Updated Another kicking has been leveled at American tech giants by EU regulators as Italy's data protection authority ruled against transfers of data to the US using Google Analytics.

    The ruling by the Garante was made yesterday as regulators took a close look at a website operator who was using Google Analytics. The regulators found that the site collected all manner of information.

    So far, so normal. Google Analytics is commonly used by websites to analyze traffic. Others exist, but Google's is very much the big beast. It also performs its analysis in the USA, which is what EU regulators have taken exception to. The place is, after all, "a country without an adequate level of data protection," according to the regulator.

    Continue reading
  • UK competition watchdog seeks to make mobile browsers, cloud gaming and payments more competitive
    Investigation could help end WebKit monoculture on iOS devices

    The United Kingdom's Competition and Markets Authority (CMA) on Friday said it intends to launch an investigation of Apple's and Google's market power with respect to mobile browsers and cloud gaming, and to take enforcement action against Google for its app store payment practices.

    "When it comes to how people use mobile phones, Apple and Google hold all the cards," said Andrea Coscelli, Chief Executive of the CMA, in a statement. "As good as many of their services and products are, their strong grip on mobile ecosystems allows them to shut out competitors, holding back the British tech sector and limiting choice."

    The decision to open a formal investigation follows the CMA's year-long study of the mobile ecosystem. The competition watchdog's findings have been published in a report that concludes Apple and Google have a duopoly that limits competition.

    Continue reading
  • Google offers $118m to settle gender discrimination lawsuit
    Don't even think about putting LaMDA on the compensation committee

    Google has promised to cough up $118 million to settle a years-long gender-discrimination class-action lawsuit that alleged the internet giant unfairly pays men more than women.

    The case, launched in 2017, was led by three women, Kelly Ellis, Holly Pease, and Kelli Wisuri, who filed a complaint alleging the search giant hires women in lower-paying positions compared to men despite them having the same qualifications. Female staff are also less likely to get promoted, it was claimed.

    Gender discrimination also exists within the same job tier, too, the complaint stated. Google was accused of paying women less than their male counterparts despite them doing the same work. The lawsuit was later upgraded to a class-action status when a fourth woman, Heidi Lamar, joined as a plaintiff. The class is said to cover more than 15,000 people.

    Continue reading
  • Google: How we tackled this iPhone, Android spyware
    Watching people's every move and collecting their info – not on our watch, says web ads giant

    Spyware developed by Italian firm RCS Labs was used to target cellphones in Italy and Kazakhstan — in some cases with an assist from the victims' cellular network providers, according to Google's Threat Analysis Group (TAG).

    RCS Labs customers include law-enforcement agencies worldwide, according to the vendor's website. It's one of more than 30 outfits Google researchers are tracking that sell exploits or surveillance capabilities to government-backed groups. And we're told this particular spyware runs on both iOS and Android phones.

    We understand this particular campaign of espionage involving RCS's spyware was documented last week by Lookout, which dubbed the toolkit "Hermit." We're told it is potentially capable of spying on the victims' chat apps, camera and microphone, contacts book and calendars, browser, and clipboard, and beam that info back to base. It's said that Italian authorities have used this tool in tackling corruption cases, and the Kazakh government has had its hands on it, too.

    Continue reading
  • AWS sent edgy appliance to the ISS and it worked – just like all the other computers up there
    Congrats, AWS, you’ve boldly gone where the Raspberry Pi has already been

    Amazon Web Services has proudly revealed that the first completely private expedition to the International Space Station carried one of its Snowcone storage appliances, and that the device worked as advertised.

    The Snowcone is a rugged shoebox-sized unit packed full of disk drives – specifically 14 terabytes of solid-state disk – a pair of VCPUs and 4GB of RAM. The latter two components mean the Snowcone can run either EC2 instances or apps written with AWS’s Greengrass IoT product. In either case, the idea is that you take a Snowcone into out-of-the-way places where connectivity is limited, collect data in situ and do some pre-processing on location. Once you return to a location where bandwidth is plentiful, it's assumed you'll upload the contents of a Snowcone into AWS and do real work on it there.

    Continue reading

Biting the hand that feeds IT © 1998–2022