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How To Add 5.5 Petabytes and Get Banned From Costco
concealment writes with this extract from GigaOm: "'We buy lots and lots of hard drives . . . . [They] are the single biggest cost in the entire company.' Those are the words of Backblaze Founder and CEO Gleb Budman, whose company offers unlimited cloud backup for just $5 a month, and fills 50TB worth of new storage a day in its custom-built, open source pod architecture. So one might imagine the cloud storage startup was pretty upset when flooding in Thailand caused a global shortage on internal hard drives last year. Backblaze details much the process in a Tuesday-morning blog post, including the hijinks that followed as the company got creative trying to figure out ways around the new hard drive limits. Maps were drawn, employees were cut off from purchasing hard drives at Costco — both in-person throughout Silicon Valley and online (despite some great efforts to avoid detection, such as paying for hard drives online using gift cards) — and friends and family across the country were conscripted into a hard-drive-buying army."
Unlimited storage for $5/mo? I have to get on this shit.
.. buy direct or maybe some wholesale? Is such deliberate effort worth the actual cost?
There's a link in TFA to an older article about them starting up and how much it costs them to run their storage: apparently it costs them $94,563 for hardware, space and power for a petabyte over 3 years. That's about $0.0026 per gigabyte per month, so if users are charged $5 per month then they just have to gamble that the average user is going to use less than about 1.9 terabytes per month.
Obviously that doesn't include a lot of other stuff like wages, but you're still gambling that a user isn't gonna have more than a terabyte of data in the system, which doesn't seem like an unreasonable gamble for now.
Many companies reserve the right to limit quantities. Making one customer happy by selling them every drive in stock means ticking off hundreds of others that wouldn't be able to buy the single drive they need.
I'm confused. Was Costco selling these drives at a loss or something, just to get people in the door?
I can't think of many good reasons that they would look at customers coming in and buying assloads of their merchandise and say "NO! Get out of here and don't buy stuff from us ever again!"
A valid question, but one which some logical thought should provide an answer to... I'd suspect Costco prefers to have many content customers (a customer who ends up at an empty shelf every day is going to go elsewhere, potentially even for other stuff) than one deliriously happy customer. The profit margins on those things are going to be minor anyway, so its not Costco were raking in the profits by selling all their harddrive stock. Presumably, this added profit did not offset all the other customers being unhappy with Costco that they couldnt buy they harddrives they advertise.
I'm confused. Was Costco selling these drives at a loss or something, just to get people in the door?
There's a difference between selling at a loss, and selling below market value. For instance, if Costco signs a contract for delivery of a million drives in Feburary, the factory floods in March, and Costco gets delivery in April, their drives are suddenly worth substantially more. They can either sell them at the previously intended prices, or they can raise prices to market value. In the first case they still sell them for more than they paid, but less than market value. In the second case, they take the customer for all they're worth, and make much more profit. Rationing is the only way the first one can work, otherwise someone will come in and buy all your drives, then resell them at market value.
A backup in your basement does nothing for you if your house burns down/gets flooded/has a catastrophic power surge/whatever.
Where else can you backup offsite?
--PM
BackBlaze did what they should have done: solve the business problem at hand.
Ah, choice use of the word "business". That must mean that it's OK to suspend all morals as long as it's "business".
Basically no.
BlackBlaze did nothing. Do not pretentd otherwise by using the word "business" to hide the acts of individuals.
The _people_ at balckblaze figured that they they would be selfish and put their needs above the needs of everyone else. That's selfish, douchebaggy behaviour.
One that Costco, by not gouging with insane prices, wasn't engaing in.
SJW n. One who posts facts.
The hard drive sellers weren't doing this altruistically. They made their call, figuring that rationing drives was the best for their businesses and best fulfilled their duty to their shareholders.
they almost certainly could have got away with upping the prices by much more than they did. They chose strict rationing instead.
It does not benefit us as individuals to assign a moral motive to the actions of a company. Whatever they do, it's for a business purpose.
And this is a real problem. They're just Soylent Corporations: made of people. It's the people that act. Pretending otherwise is an attempt to justify imorral action.
Taking that to its illoigcal conclusion could lead to hypotheticals like
Well, it's OK that they kidnapped babies, murdered them and sold them for dog food. It was a really cheap source of meat and so the profit margin was immense. Excellent for business.
We must realize that they are all "selfish bastards" by the very nature of the capitalist system and not be fooled into personifying them.
No: you have been fooled into believeing that companies act independent of people. They do not and they cannot. Only people can act and people can and do choose to do immoral things for money.
The fact that they're doing it for money is no justification whatsoever.
SJW n. One who posts facts.
Ethics and moral are highly dependent on the eyes of the beholder. What is ethic and moral to you may be highly unethical and highly immoral to me and the other way around.