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It seems the hyperscalers are more in favour of shreding their hardware rather than putting it for sale on ebay. But I'm not sure if this holds true, I have seen old Google servers on /r/homelab.

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Have you seen actual google servers, or their whiteboxed dell search appliances they sold for a while for other people to run in their own datacenters?

These are some examples of the search appliances: https://www.ebay.com/itm/155187480321 https://www.ebay.com/itm/284745813810

They have data sanitization requirements that become difficult to manage at scale if they do anything else. Are you SURE there was no customer data stored in a recoverable-by-modern-physics manner on that machine you sold? Would you stake billions of dollars on it?

Pretty much everything is encrypted at rest in the big datacenters these days

It most definitely is not. And once you leave AWS or GCP proper the amount of control plane and other data that's encrypted at rest plummets. The industry is VERY not good at this at scale. And besides, encrypted customer data is still customer data. Metadata about encrypted data might divulge sensitive stuff, etc.

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