This reeks of spinning a story by AWS in the hopes to avoid measures from anti-monopoly authorities.
Off course a company will deny that they are a monopoly (or cartel etc). They'll keep pointing out their competition to these authorities. Ironically, the investor relations of such companies often point at the same data, to tell their investors how big their moat is and how insignificant their competion.
I'll believe this change is really happening when AMZN starts reporting decline in their AWS gross returns. Is this declining?
This is just how antitrust works. The regulator defines a market, usually fairly reasonably, but sometimes incorrectly. Then the regulator points out you have massive market concentration and tries to do something about it. Then the company(ies) that hold that market power lie out their arse/otherwise creatively redefine the market so it looks like it's under a threshold that would require action. Then this goes round and round in the courts for years until someone gets fined, the regulator goes away and the guy who was leading the charge at the regulator gets a cushy job at the big co or related co or starts a law firm specializing in fighting against what he was previously fighting for.
The article is about an anti-trust body researching whether that moat is not too much of a monopoly:
> In a summary of evidence given to UK watchdog, the Competition and Markets Authority (CMA), AWS denies that customers face any difficulty in switching from its platform.
Look at market share and ease of switching cloud service providers. A rule of thumb is that if you own more than 50% and can dictate prices, you might be a monopoly.
That said, the current argument is that because AWS is part of Amazon at large, it can gain undue advantage by being subsidized by other organizations in Amazon, and forgo profits in order to gain a controlling share in an industry.
This is basically Lina Khan's whole argument [0]
I personally don't subscribe to this argument as a major reason for AWS's dominance compared to Azure in the early 2010s was because of stronger execution (lots of training sessions, evangelization, some truly cutting edge architecture) and better product-market fit, but Hipster Anti-Trust assumes a bunch of smallish companies competing with each other can result in a similar outcome (hence why VCs like Thiel, Horowitz, and Andressen tended to support scholars affiliated to the New Brandeis Movement)
The parent article literally says
> In a summary of evidence given to UK watchdog, the Competition and Markets Authority (CMA), AWS denies that customers face any difficulty in switching from its platform.
This CMA was investigating amazon's possible monopoly on cloud. So, this whole thing started rolling exactly because authorities are asking the exact same questions as you "In what way is AWS a monopoly." and in doing so, see enough leads to at least ask for reports and AWS's reply.
The FTC is actively engaging in a monopoly case against Amazon: the organization whose job it is to break up monopolies certainly believes them to be one
it's not, it's an oligopoly. In corporate it's basically them, microsoft, kind of google and then a tiny sliver of the market is filled with a whole bunch of wannabes.
The parent article is about the CMA researching whether AWS is a monopoly and the answer to that from AWS.
> Declining revenues isn't the sign of not being a monopoly.
Thats a definition thing, though. Monopoly can mean a lot, depending on which side you are defending.
In this case I meant that AWS had insane margins when they were the only player - first mover advantage etc. But those margins didn't decline when their "competition" started becoming serious. In fact, if you look at their shareholder reports, AWS, GCP, Azure etc all have similar margins now, and AWS's didn't decline.
This tells us not if there's a monopoly. But it does tell us that there's no competion on margin/price.
Bu, what I meant was that if "on prem is a true competitor to AWS" we'd see their gross profits decline, as people are moving off AWS. And if we don't see this happening, than it's not a true competitor.
That is fantastic news if true. AWS and two other major cloud providers have done everything in their power to make it painful for businesses to switch off of them. Case in point: egress data fees are something like 80x compared to what the cloud provider actually pays. You still have to pay them in full unless you decide to leave AWS completely.
Try using Cloudflare R2 with zero egress and you'll rapidly discover there are lots of 'gotchas'...
- Want to use a cloudflare managed domain - pay for egress if you have enterprise account
- Want to use their 'dev' domain - rate limited
It's still a good service - but zero egress comes with conditions. The only exception I've found is Cloudflare pages which seems genuinely zero egress (as long as you don't proxy it through a managed domain).
Those fees are egregious, but they don't make it any harder to switch off AWS. The cost of the monumental amount of engineering time such a task takes is a couple orders of magnitude greater than the cost of the data egress.
It's almost to the point where you wouldn't even bother to factor into a cost calculation.
That doesn't really make sense. AWS is very profitable [1]. That means that whatever the amount of money they put into engineering, their customers pay, and then some.
As for the customers, very few of them operate at a scale that requires the monumental amount of engineering required to replicate the whole of AWS with its many dozens of services.
That entirely depends on how you build your stack.
I always strongly push for setting up the whole infrastructure with a future migration in mind, and without tying the company closely to specific cloud services.
You lose out on some of the better cloud features, but it's worth it in cash alone: being able to say "we have built our stack to be platform agnostic, we can switch within a month" is very useful in discussions with sales...
AWS claiming that on-prem solutions are competition to UK regulators is like Apple insisting the App Store isn't a monopoly to EU regulators, Google asserting that Chrome isn't dominating the web to the DoJ, or Microsoft denying its omnipresence over the workplace. It's laughable. Seriously, did anyone here actually bother to read beyond the headline?
Those are indeed similar situations, but your examples except the first one do not come from the article. So it is not clear why do you assume that everyone did not read beyond the headline.
I'm not sure I believe this... I haven't seen a sysadmin job around here for a couple years... (unless you count Montreal, but I'm not moving to Quebec...)
It is happening. Companies start to be more and more aware of the high cloud costs. Cloud is nice to spin up a project and have some elasticity in the performance requirements. But once it's running more stable and predictable it tends to be cheaper to have it running on premise.
Currently in the middle of an EKS to on-prem OKD migration for a large company. It’s definitely happening- on prem with negotiated power/connectivity contracts, datacenter space, and hardware is a fraction of the cost of AWS at a certain scale. DC space includes remote hands but we could even throw in a few DC tech full timers and still save a ton of money.
The thing I don't like about contract/outsourcing is the uncertainty... I'd rather be at a place where I know I don't have to worry about my next job...
I’ve been in jobs with cloud platform responsibilities at large financials for the last nine years. With all of the regulatory oversight and internal controls, the all-in price for cloud is actually quite high and usually gives businesses pause when they start to realize that.
Operating data centers is also incredibly expensive. The biggest costs come when you need to build new ones while maintaining what you have. The last place that I worked we spent several billion dollars in data center builds over the course of five years. Cloud was seen as a way to reduce the demand, but it takes a long time to build and mature a delivery platform that can run at reasonable velocity and adapt to business demands.
Now regulators are really focused on concentration risks and are demanding multi-cloud architectures and are testing contingency plans in the event of massive failures on the part of service providers. This will in part drive a demand for reserve capacity in datacenters as well as build out of platform management capability that that can move workloads around without substantial incremental engineering work.
There is definitely a specific monetary threshold where the financial justification flips and its probably around about $1 million/year of cloud costs if you need two region equivalent. This isn't "build a data center" kind of money, this is "rent some controlled racks and hire staff". You'll have to eat a good chunk of that operational savings over the time window with a big upfront capital hardware purchase.
That being said, this reeks of making a anti-monopoly argument and seems wildly overstated.
To be honest, whole foods and the go stores could be (at least in some small part) a way to shift their competition base from "online retail" to "all retail" for anti-trust purposes. I wonder if AWS outposts melding cloud to on-prem fulfill enough to be a similar premise of widening the span of competition.
Oxide already showing up and eating AWS's lunch I see.
Seriously though, it does feel like above a certain company size you really do get into a position where, if you can hire the team to run it, on-prem just feels right. Especially if you're not even really in the "internet" business in the first place. Cloud is so costly!
Every once in a while I go drool over the Oxide server racks but I doubt I could afford one (or if I could I doubt I'd want to spend that much, and that's before needing to colocate it).
time to hire a bunch of cloud ~~shills~~ evangelists again to concern troll about the hurdles of setting up a basic bitch VPS, pretending that it takes a cadre of highly-paid professionals do accomplish such monumental tasks
I don’t think anyone thinks that VPS is hard. Contrary, it seems universally acknowledged that VPS are way cheaper than cloud. Still people buy cloud for other reasons, good or bad.
To me it is
- Systems Manager: centralized access to servers with logging.
- RDS: backups, replication, DMS, DB autoscaling with Aurora.
- ECS: simpler k8s, autoscaling
- CloudFormation, terraform, CDK and pulumi.
- Lambda
Readit News
Off course a company will deny that they are a monopoly (or cartel etc). They'll keep pointing out their competition to these authorities. Ironically, the investor relations of such companies often point at the same data, to tell their investors how big their moat is and how insignificant their competion.
I'll believe this change is really happening when AMZN starts reporting decline in their AWS gross returns. Is this declining?
The article is about an anti-trust body researching whether that moat is not too much of a monopoly:
> In a summary of evidence given to UK watchdog, the Competition and Markets Authority (CMA), AWS denies that customers face any difficulty in switching from its platform.
That said, the current argument is that because AWS is part of Amazon at large, it can gain undue advantage by being subsidized by other organizations in Amazon, and forgo profits in order to gain a controlling share in an industry.
This is basically Lina Khan's whole argument [0]
I personally don't subscribe to this argument as a major reason for AWS's dominance compared to Azure in the early 2010s was because of stronger execution (lots of training sessions, evangelization, some truly cutting edge architecture) and better product-market fit, but Hipster Anti-Trust assumes a bunch of smallish companies competing with each other can result in a similar outcome (hence why VCs like Thiel, Horowitz, and Andressen tended to support scholars affiliated to the New Brandeis Movement)
[0] - https://www.yalelawjournal.org/pdf/e.710.Khan.805_zuvfyyeh.p...
This CMA was investigating amazon's possible monopoly on cloud. So, this whole thing started rolling exactly because authorities are asking the exact same questions as you "In what way is AWS a monopoly." and in doing so, see enough leads to at least ask for reports and AWS's reply.
https://www.ftc.gov/news-events/news/press-releases/2023/09/...
Edit: Amazon, not AWS. Sorry for the confusion!
Declining revenues isn't the sign of not being a monopoly. How is AWS actually a monopoly?
> Declining revenues isn't the sign of not being a monopoly.
Thats a definition thing, though. Monopoly can mean a lot, depending on which side you are defending.
In this case I meant that AWS had insane margins when they were the only player - first mover advantage etc. But those margins didn't decline when their "competition" started becoming serious. In fact, if you look at their shareholder reports, AWS, GCP, Azure etc all have similar margins now, and AWS's didn't decline.
This tells us not if there's a monopoly. But it does tell us that there's no competion on margin/price.
Bu, what I meant was that if "on prem is a true competitor to AWS" we'd see their gross profits decline, as people are moving off AWS. And if we don't see this happening, than it's not a true competitor.
Like, is Azure not a thing? GCP? Hetzner? DigitalOcean? etc.
IONOS Virtual Private Servers - $30/month - zero egress fees.
It's still a good service - but zero egress comes with conditions. The only exception I've found is Cloudflare pages which seems genuinely zero egress (as long as you don't proxy it through a managed domain).
As for the customers, very few of them operate at a scale that requires the monumental amount of engineering required to replicate the whole of AWS with its many dozens of services.
[1] https://www.seattletimes.com/business/amazon/amazon-reports-...
I always strongly push for setting up the whole infrastructure with a future migration in mind, and without tying the company closely to specific cloud services.
You lose out on some of the better cloud features, but it's worth it in cash alone: being able to say "we have built our stack to be platform agnostic, we can switch within a month" is very useful in discussions with sales...
I’ve been in jobs with cloud platform responsibilities at large financials for the last nine years. With all of the regulatory oversight and internal controls, the all-in price for cloud is actually quite high and usually gives businesses pause when they start to realize that.
Operating data centers is also incredibly expensive. The biggest costs come when you need to build new ones while maintaining what you have. The last place that I worked we spent several billion dollars in data center builds over the course of five years. Cloud was seen as a way to reduce the demand, but it takes a long time to build and mature a delivery platform that can run at reasonable velocity and adapt to business demands.
Now regulators are really focused on concentration risks and are demanding multi-cloud architectures and are testing contingency plans in the event of massive failures on the part of service providers. This will in part drive a demand for reserve capacity in datacenters as well as build out of platform management capability that that can move workloads around without substantial incremental engineering work.
That being said, this reeks of making a anti-monopoly argument and seems wildly overstated.
Seriously though, it does feel like above a certain company size you really do get into a position where, if you can hire the team to run it, on-prem just feels right. Especially if you're not even really in the "internet" business in the first place. Cloud is so costly!
To me it is - Systems Manager: centralized access to servers with logging. - RDS: backups, replication, DMS, DB autoscaling with Aurora. - ECS: simpler k8s, autoscaling - CloudFormation, terraform, CDK and pulumi. - Lambda