I guess I have to hand it to these folks as they are up front about it.. But I just came across this little gem, where a Seattle-area startup talks about a nearly $6 million loss they are taking for 2013, and really what caught my eye more than anything else is their cloud spend
They spent 25% of their REVENUE on cloud services in 2013 (which for them comes to just over $7 million)
REVENUE, 25% of REVENUE. Oh. my. god.
Now I shouldn’t be surprised, having been at a company that was doing just that(that company has since collapsed and was acquired by some Chinese group recently), and know many other companies that are massively over spending on cloud because they are simply clueless.
It is depressing.
What’s worse is it just makes everyone’s else life harder because people read articles about public cloud and crap and they see all these companies signing up and spending a lot, so they think it is the right thing to do when more often than not (far more often than not) it is the wrong strategy. I won’t go into AGAIN specifics on when it is good or not, that is not the point of this post.
The signal to noise ratio of people moving OUT of public cloud vs going INTO it is still way off, rarely do you hear about companies moving out, or why they moved out. I’ve talked to a BUNCH of companies over the recent years who have moved out of public clouds (or feel they are stuck in their cloud) but those things never seem to reach the press for some reason.
The point of this post is to illustrate how absurd some of the spending is out there on cloud. I am told this company in particular is building their own cloud now apparently I guess they saw the light.
My company moved out of public cloud about two years ago and obviously we have had great success ever since, the $$ saved is nothing compared to the improved availability, flexibility and massive ease of use over a really poor public cloud provider.
Oh as a side note if you use Firefox I highly encourage you to install this plugin, it makes reading about cloud more enjoyable. I’ve had it for months now and I love it. There is a version for Chrome as well I believe.