Is this a Cloudflare sell signal?
I'm also trying to unpack "legitimize" to something more concrete... One possibility is that AWS's action is a signal of AWS customers' moving business to Cloudflare (that we wouldn't otherwise know about). Or perhaps it's simply AWS flinching and consequently customers perceive Cloudflare as more legitimate and move more business there?
AWS had growth of $1.2B in last quarter? I think AWS is still hitting something like 30%+ revenue growth YoY even though they are already huge?
With this size / scale, AWS should be able predate someone like cloudflare on base pricing.
I do think cloudflare may be able to evolve their products faster given they aren't carrying around x billion of recurring revenue.
Cloudflare simply doesn't share egress pricing.
1) They do not have public egress pricing. That should be a red flag at this time.
2) They are currently LOSING a lot of money on their offerings - AWS makes a ton. That should be red flag #2.
This is not interesting without more context. If they lose money because their income is below costs, that's a problem. If they lose money because they have headroom and spend all of it on customer acquisition, that's an opposite of a problem.
One thing - is their free service offering a sales and marketing expense or is that in cost of revenue.
Last quarter they did 80M in sales costs (vs 40 in R&D and 28 in G&A). Sales costs were 50% of operating costs and close to 50% of revenue.
Amazon has everything blended, but sales runs 7% of revenue.