Secrets of Amazon Web Services low prices

[life0riley]

I found this very interesting.

Four secrets of AWS's low prices

[dequire]

Was a pretty good read, for sure.

[SteveRiley]

I'll comment a bit, based on my experience working for AWS.

1. Custom hardware. The article makes a bit much out of the word "custom." AWS compute machinery is a high density variation of standard x86-64 architecture. Cost savings from the high density.

2. Supply chains. It's absolutely true that AWS doesn't rely on a single vendor for any particular component. This has numerous cost advantages; one not mentioned in the article is playing one supplier against another (sucks if you're the supplier). And people sure love to speculate what Glacier is. I'll just say this: which do you think is cheaper for AWS -- building completely new architectures for something that is "tape-ish," or creating a new pricing structure for the same disks used by S3, but incentivized in such a way to ensure customers don't use it for primary storage?

3. Scale. This is AWS's most important competitive advantage. It's also why I predict AWS will crush most other IaaS-style cloud providers in the next four years. Nobody else is as good or as cheap.

4. Frugality. Not always a net benefit, despite the "we're looking out for the customer" platitudes. I've seen waste, but certainly not to the degree I saw at Microsoft. (And the waste I saw during a two-day meeting at the Googleplex was nothing short of breathtaking.) Now, note the revenue vs. profit comparisons. Google: $59.8 Bn / $12.9 Bn. Microsoft: $77.9 Bn / $21.9 Bn. Amazon: $74.45 Bn / $0.27 Bn. Google and Microsoft love to stash money in the bank. Why doesn't anyone ask what the fsck for? Amazon -- frugal as it is -- plows nearly every dollar it earns back into the business. Unfortunately -- big time -- not much of this makes its way to employees in salaries or benefits. Of every place I've worked, salary plus benefits vs. work-life balance was abysmal.

[whatthefunk]

4. Frugality. Not always a net benefit, despite the "we're looking out for the customer" platitudes. I've seen waste, but certainly not to the degree I saw at Microsoft. (And the waste I saw during a two-day meeting at the Googleplex was nothing short of breathtaking.) Now, note the revenue vs. profit comparisons. Google: $59.8 Bn / $12.9 Bn. Microsoft: $77.9 Bn / $21.9 Bn. Amazon: $74.45 Bn / $0.27 Bn. Google and Microsoft love to stash money in the bank. Why doesn't anyone ask what the fsck for? Amazon -- frugal as it is -- plows nearly every dollar it earns back into the business. Unfortunately -- big time -- not much of this makes its way to employees in salaries or benefits. Of every place I've worked, salary plus benefits vs. work-life balance was abysmal.

Yes. Amazon has a miserable reputation for how it treats workers.

[SteveRiley]

Yes. Amazon has a miserable reputation for how it treats workers.

You're thinking of the "fulfillment centers," where working conditions are known to be rubbish and brutal. I'm not proud of having been associated with that. The company treats instance-hours (VMs) and megabyte-months (storage) just like retail commodities -- which is not necessarily a bad thing. This has allowed for similar thinking about employees to permeate up the organization chart, to a certain level at least -- which is a bad, thing, at all levels.

[zaphod]

Okay, I wanted to post a relevant post to this topic (Snowhog probably knows what), but 2 links are important. This message serves as a "kicker" message to activate links. Please forgive this once.

Zap

edit: Thanks!

[zaphod]

Their reputation goes much further than how they treat employees. But I'll let a couple of websites do the talking for me...

http://sitevet.com/db/asn/AS16509

http://www.blocklist.de/en/search.ht...d=start+search

They aren't as bad as they used to be, but their cloud will remain blocked from my server for a long, long, long time.

Zap

[SteveRiley]

Because a handful of badguys use AWS as a platform for launching attacks doesn't mean you need to block all of AWS. Following that logic would necessarily require you to block every cloud provider, every hosting provider, and every ISP on the planet. I doubt you would find that a useful defense.

AWS is attractive to badguys because it's very inexpensive and entirely self-service. For these reasons, and while it isn't 100% perfect (who is?), AWS runs one of the strongest anti-abuse programs I've seen.

[zaphod]

Yes, but you only want select robots and spiders to visit your site. No humans (due to the anonymity factor that begets spam) should visit from a cloud service running proxy servers and VPNs. So yes, keep the door open to access provider ISPs, but not CoLos, hosting providers, and cloud services. Also, the amount of non-human traffic (net noise) that comes from those "undesirables" can jack up your bandwidth usage 3X to 5X, thus costing you real money when your host demands you move to a higher bandwidth tier hosting level.

My sites want humans, not robots. Google, Slurp, Bing, and archive.org are good because they drive humans to my site or fulfill a purpose. Almost every other webtool scanning, scraping, and probing my site can get lost till I need them.

Zap