Amazon makes 14 cents from every Lyft ride

There are dedicated REITs that hold only high-tech/data center real estate.

On top of that you have to hire people to manage it.

I think they'd be much better off just renting some space out in a datacenter and run the show themselves!

IT's version of the Laws of Thermodynamics is that nearly every interesting action you can do programatically is going to take at least O(log n) time, where n is the amount of data you have (at rest, in flight, or both).

If I have 16x as much traffic as I used to deal with, my load isn't 16x higher, it's 64x higher - if I'm fortunate and we've engineered for scale. But it could easily be three orders of magnitude higher (16164) if I'm not.

For the 64x scenario I tell my boss to buy more hardware and I put medium to high priority tickets in the backlog to improve the worst cases. In the 3 orders situation, those tickets bump all of our other priorities, and there are more of them. Performance is now a feature. It sucks up a significant and very visible fraction of our engineering budget, which comes with its own sort of opportunity costs.

If you try to scale vertically, we all know that except at the low end, buying a server that's twice as beefy costs far more than twice as much. If you go horizontal, there are plateaus where your network topology has to get more complex (hardware cost, maintenance cost, speed, pick two). Personally, I think the biggest lie in cloud computing is that 10G ethernet fixes all of your network topology problems (ie, it's treated as magic that you don't have to worry about). As disks and PCIe get faster over the next couple years I think that'll be back on people's radars.

But it could very likely be true that doubling the number of rides would have a potentially material impact on additional AWS spend for Lyft.

However, in the case of AWS and other cloud service providers, virtually all products and services are charged on a per-usage basis. Meaning that if the average Lyft ride requires 60 database api calls (say a 10 minute ride with location updates every 10 seconds = 60 location updates/db writes) then AWS charges you for 60 api calls. If the average ride takes 11 minutes, then it would take 66 api calls and so forth. In this case, this cost is a variable cost and maps directly to a specific ride. If that ride had not existed, then that cost would not have been incurred.

Take a look at AWS pricing pages and you will see that all prices are broken down into very specific per-usage costs. Some services break this up very deeply, on ingress usage, egress usage, storage usage, api usage, etc all together calculate the cost that the service uses.

Looking at the Lyft Case Study that AWS published (you can view here: https://aws.amazon.com/solutions/case-studies/lyft/), it appears they primarily use Redshift, Kinesis, DynamoDB, and EC2/ECR services. All of these are heavily usage based. The least usage-based service they use would be their EC2 servers. Since a server is rarely running at max-capacity it means that one extra lyft ride doesn't necessarily mean another server. So the EC2 costs for that ride would be the same if it had or had not existed. But it looks like they are heavily reliant on using ECR to auto-scale their servers up and down based on usage. So they are probably running many clusters of smaller servers that move up and down as rides increase. This means that even their EC2 servers are fairly closely mapped to actual usage of their platform. During a slow period they will be running far fewer EC2 servers than during a peak period. So even in this case their costs are relatively variable.

All in all, I would say that you actually could extrapolate the total cost of AWS on a per-ride basis, because that is the variable that effects their costs. If they had 1 less ride this month, their bill would ACTUALLY be 14 cents lower (or somewhat close to it). They do incur a direct cost with each individual ride. If there are fixed AWS costs in there, it probably accounts for less than 1 penny of that 14 cents. For example there are a few fixed costs if they are using AWS DirectConnect or AWS Private Link to connect to AWS Datacenters. But this accounts for probably a few thousand dollars a month at most and in total would have minimal effect on thier per-ride cost at the current scale that Lyft is at.

edit: spelling

Of course building one datacenter and own oceanic fiber to host your own services is a bad option for almost every business - not every business can fill a full DC, and 1 DC is not enough to guarantee global operations.

And if mods feel it's appropriate, then I don't mind if the link is swapped.

Otherwise, maybe consider voicing opinions like these about things you actually know something about.

ADDED: Meant to respond to a different comment that didn't suggest any inside knowledge. (Though I'd still point out that even insiders often can't understand how their own company has so many employees in X department, is so inefficient, etc. And this is more or less the case everywhere.

Microservices? :-)

- only parenthetically mention colocation, as if it isn't absolutely normal to rent a rack/cage/suite as needed from an existing DC operator (which in addition would make datacenter rent an OpEx and actual server equipment be amortized over 2-3 years, not the 10 for real property)

- somehow present "intercontinental traffic" as something both necessary and tremendously expensive, as if all the major public clouds aren't charging 10x what the market rates for bandwidth are

- imply that "the cloud" is immune to outages, as if GCP didn't have multiple major global- or region-wide outages over the past few years

I mean, I understand why most companies don't go on-prem despite all that, but this series of tweets is borderline FUD.

You can never hand them enough dollars to get their SLAs/latency on par with the cloud. There will be outages. There will be delays. There will be scale problems. There And you'll have to address these somewhere else, either in your tech stack, your operating model, or your PR department.

Paying a 2-5% TCO premium to have a throat to choke, 5 9s redundancy, GDPR compliance, and the law of large numbers on your side of the court is a pretty fair trade.

Lyft lost a billion dollars on $2B of revenue in 2018.

AWS costs that wouldn't really fit into a per-ride accounting:

* Redundancy of instances (regions/AZs) * Data-storage/duplication/backups * Non-ride related AWS costs (hosting/processing of analytics, test & automation infrastructure, etc.)

I'm sure there are others. I'm not saying that there's no way they could get their AWS costs down, btw.

Suggesting lyft needs 5-9s is ridiculous for 1000s of servers is ridiculous. Its entire event stream comes from a mobile network which is probably less reliable.

But, all in all, there aren't all that many practical use cases that really benefits from stuff like that. Most projects are quite happy with some storage, compute, network, and a few managed services. Most companies don't do rocket science with their software and infrastructure.

And there are things that you simply can only afford at scale, like security management for your supply chain, dedicated automation for updating firmware of every tiny controller that's in your hardware, and so on.

My understanding is that the biggies - Google, Amazon, Facebook, etc. - don't bother with individual drive replacements (and certainly not with an expensive robotic arm system). They wait for an entire rack to fault over a certain percentage and then just swap out the whole thing.