I've done some cost analyses between our AWS and DC infrastructure.
To come up with our on-prem compute costs, we baked in the cost of power, real estate, staff, taxes, network infrastructure, servers (both in-use and in reserve), etc. On the AWS side, we used 3 year RIs and Savings Plan. After all that, there was around a 30% cost advantage on-prem. That's non-trivial, but not as big as one might think.
Outbound networking, however, is ludicrously cheaper on-prem. It's about 85% cheaper on-prem than in AWS. Bandwidth is not expensive outside the public cloud.
In fact, egress volume is the #1 cost driver for us moving a service on-prem or building it there to begin with. Some of the AWS managed services are also very pricey, but nowhere near the egregious markup of egress bandwidth.
Typical cloud bandwidth pricing is known as "roach motel pricing" after the old roach motel pest control slogan of "roaches check in but they never check out." The idea is to make ingress free but egress expensive to make it easy to move all your data in but costly and hard to move it out.
Meh cpus/ram most likely have lighter margins for cloud vendors compared to storage and bandwidth (which is just ridiculous) but they have to keep a lot of spare capacity for scaling so if you don’t scale by much you can do way better on metal even on cpus
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I always found the CPU pricing of cloud to be relatively reasonable. It's everything else that's expensive, and egress bandwidth just ridiculous.
I've done some cost analyses between our AWS and DC infrastructure.
To come up with our on-prem compute costs, we baked in the cost of power, real estate, staff, taxes, network infrastructure, servers (both in-use and in reserve), etc. On the AWS side, we used 3 year RIs and Savings Plan. After all that, there was around a 30% cost advantage on-prem. That's non-trivial, but not as big as one might think.
Outbound networking, however, is ludicrously cheaper on-prem. It's about 85% cheaper on-prem than in AWS. Bandwidth is not expensive outside the public cloud.
In fact, egress volume is the #1 cost driver for us moving a service on-prem or building it there to begin with. Some of the AWS managed services are also very pricey, but nowhere near the egregious markup of egress bandwidth.
85% cheaper seems little. In my case (collocation) bandwidth is 95% cheaper (i.e AWS is 20x as expensive) than AWS.
A quick question.
Have you also included:
in the above price comparison?Would you have some insights there? Thanks.
Typical cloud bandwidth pricing is known as "roach motel pricing" after the old roach motel pest control slogan of "roaches check in but they never check out." The idea is to make ingress free but egress expensive to make it easy to move all your data in but costly and hard to move it out.
Meh cpus/ram most likely have lighter margins for cloud vendors compared to storage and bandwidth (which is just ridiculous) but they have to keep a lot of spare capacity for scaling so if you don’t scale by much you can do way better on metal even on cpus