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How Amazon Keeps Cutting AWS Prices: Cheapskate Culture
An anonymous reader writes "Amazon Web Services has cut its prices on 40-plus consecutive occasions, at times leading the charge, at other times countering similar moves by Microsoft and Google. This article at CRN includes some interesting behind-the-scenes trivia about how Amazon keeps costs down, including some interesting speculation — for example, that perhaps the reason Amazon's Glacier storage is so cheap is that maybe it might be based at least partly on tape, not disk (Amazon would not comment). The article also explains that the company will only pay for its employees to fly Economy, and that includes its senior executives. If they feel the need to upgrade to Business or First Class, they must do so from their own pocket. And instead of buying hardware from an OEM vendor, AWS sources its own components – everything from processors to disk drives to memory and network cards — and uses contract manufacturing to put together its machines."
Unless you work in finance, oil/gas or certain luxury markets and have money to burn you're flying economy no matter what industry you're in. It's not being cheap, it's being smart. You're stil going to get to the same place at the same time as the other passengers.
The requirement of 'no business class' for air travel isn't unique to Amazon. Every tech company I've worked for had the same policy - From the senior execs on down.
Thankfully, the company I work for now doesn't require red-eye flights. So I can arrive at a destination, sleep overnight in a hotel bed, then wake up the next morning and start working.
We're supposed to be surprised that everyone is supposed to fly coach?
And, if you're custom rolling your backend at the scale of AWS, I wouldn't expect anything *but* sourcing yourself. Outsourcing is for organizations that don't have the expertise in house and want a finger to point if things go wrong. Vertical integration is more cost efficient if you have the scale to make it work.
Is it just my observation, or are there way too many stupid people in the world?
Doesn't 'cheapskate' have a somewhat perjorative connotation, either edging into 'stingy' (if talking about spending on socially normative things) or 'penny wise, pound foolish' (if talking about good sense in short and long term cost/benefit thinking)?
From what the article decribes, Amazon isn't so much 'cheapskate' as operating perfectly sensibly given their scale, cutting unnecessary (but usually bundled) components, and not giving in to poorly justified; but commonly assumed, habits like sending Important Employees to fly business class.
I can understand why they would be scaring their competitors pretty seriously; but I'm not sure that I see the 'cheapskate' bit.
AWS is expensive, I can provide the equivalent of an m3.large reserved instance to my users for 1/4th the cost over 3 years, if you ammatorize my infrastructure over 5 years (which is what we've actually been doing) then it's almost 1/7th as much. The only places where AWS makes sense is if you're a quickly growing startup, have a VERY bursty workload, or you're so small that you can't justify 3 hosts for a VMWare Essentials bundle.
There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.
perhaps the reason Amazon's Glacier storage is so cheap is that maybe it might be based at least partly on tape, not disk
That is one of the stupidest things I have ever read. Of course it is using tape, why else would it take up to 24 hours to get your data when you request it? Everyone knows that is the whole point of Glacier, and the reason they can offer it so cheap. Nobody wants to deal with the hassle of having their own offsite tape library, so Amazon will do it for you with a convenience user interface. That is literally exactly what all of AWS is based on, doing something cheaper for you because they have the expertise and the facilities at scale.