Hacker News Reader

Comment by thinkloop | Hacker News Reader

> if they focus on building infrastructure, it might slow them down

I always found this issue of "focus" a bit strange. Two billion can buy a lot of focus. For example, say there was a separate company smaller than Google that snap outsourced their infrastructure to, allowing them to focus, then they bought that company - it comes out to the same.

The technical capabilities is a different story.

View on HN

The amount of money on the table isn't 2 billion dollars. The amount at stake is the difference between 2 billion dollars over 5 years, and the theoretical best case operating costs of your own infrastructure, which very well might be higher than Google's because Google's scale is bigger. Snap might say to themselves that they don't want to be paying Google's margins, so they invest a billion dollars in development for infrastructure with identical performance costing only 350 million a year instead of 400 million. Is that worth it?

By the time the other company builds infrastructure, some other company would have built the product that Snap wants to build.

By "cloud computing expert", do you mean Amazon sales shill? It's weird enough that someone on HN would just use that vague credential of "expert" in the first place, but this thread is ridiculous ('round here, usually we recognize experts when they say something along the lines of "Hi, I'm the guy discussed in the article...", or "Hi, I actually wrote that software 15 years ago...").

You know that Snap can hire more than 3 people, right? They can have people working on the infrastructure at the same time that someone else works on "the product" they want to build. That's what happened at Google, and as a side effect, they now have a cloud platform they can rent out.

There are some benefits to using cloud services in some cases. It's rare that 100% cloud is a wise deployment move, especially for companies that operate at Snap-scale.

That's the point I'm trying to make. Snap has, say, 100 employees + $2b. The 100 employees are working on features. The $2b can now go to Google, or to purchase "focus" for in-house infrastructure, there is no slow down in developing features. Now if they can't technologically duplicate what they need using $2b is a different story which I have no opinion on.

They don't just have to build it though; they have to build it fast enough to handle their growth. $2B might not be enough (or it might not even be possible for any amount) to build what they need fast enough to not hamper growth.

Also, by buying from Google, they hedge against lower than expected growth too. If growth doesn't meet expectations, while they're still obligated to spend the $2B, they can re-sell the services for likely close to cost, given they'll be getting a discount.

Reply on news.ycombinator.com