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Comment by 411111111111111 | Hacker News Reader

But having everything redundantly available costs money. While some redundancy is easy to justify... At some point it becomes hard when the MBA wants to cut costs so he gets a bigger bonus.

There is even a competitive advantage in living with the risk, as you have less costs and overhead... Sure, you might have an outage once every x years for a few minutes... But that's obviously the fault of the development team, duh

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This is a classic example of an externality. You use regulations or lawsuits to force the costs back onto the decision makers. Make it so people can collect damages from outages, the company then needs insurance to cover the potential costs of an outage; if the savings from removing a redundancy exceed the increase in insurance premium then it is actually efficient, otherwise it is a net negative. While an actuarian may make a mistake and underestimate the likelihood of an outage, they are far less incentivized to do so than the MBA looking for a bigger bonus.

If you can win a lawsuit against a company for a failure it is probably because it wasn't an externality but a contract or warranty agreement they have breached. This is present even in niches with minimal regulations.

Data centers offer the highest uptime guarantees at the highest price tiers. People pay more for Toyotas, new or used, because of their reputation. Quality is a product feature. If MBA's want to decide if they can cut corners, there are already upsides and downsides, the calculation is something they need to make.

Yeah, I'm saying add regulations so it is no longer an externality.

Quality is a product feature when there is competition, monopolies don't suffer from cutting quality.

whereas I'm saying it's not an externality even in the absence of manipulation by specific regulations, which you apparently agree with given your second sentence.

I find that people have a tendency to be overly narrow in considering competition and declaring things monopolies. There are alternative ways to get tasks done that avoid relying on (and paying for) low-quality internet services if companies find it necessary.

An externality is a side effect or consequence of an industrial or commercial activity that affects other parties without this being reflected in the cost of the goods or services involved. Removing redundancy to increase profit margins affects other parties (ie users) without affecting the cost of the goods or services involved. If and only if the MBA's decision to increase risk to the user is reflected in the costs does it cease to be an externality.

And we are specifically talking about an industry over-relying on a single provider of a service. If there were a variety of competing services, the entire point would be moot.

Which is one reason why things like roads, trains, water, electricty, etc. are so heavily regulated. To prevent the companies that hold monopolies over the infrastructure from cutting corners like that.

Right, but that's why we (ideally) put infrastructure costs under the control of an entity (the government) which doesn't have to operate within a system of profit and market competition.

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