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Comment by khaki54 | Hacker News Reader

The value proposition of commercial loud isn't cost savings unless you manage to quantify all of the ancillary and extrinsic factors such as security risk, HVAC, datacenter personnel, and hardware lifecycle. Any well capitalized and organized company could build their own cloud much more cheaply, but really a significant portion of the calculation is outsourcing the risk components.

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The problem with outsourcing the risk components is that you don't know for sure whether they are properly taken care of. Major cloud providers have been caught "oopsing" your data, and bam it is gone. Furthermore, they have no incentive to be more efficient about it, they could easily be using 10x the amount of resources necessary, and you wouldn't even have a clue, you're just paying for evermore expensive crap that becomes less reliable over time.

But the cloud providers compete with other other! Look at the efficient market in display in their bandwidth pricing!

For very large customers, the cloud providers do compete with each other on cost. They often pay different prices than are advertised.

> Any well capitalized and organized company could build their own cloud much more cheaply

Lots of orgs fail to turn money into talent and then talent into products.

It just takes one bad hire at senior level and suddenly your cloud is a vmware install where all machines are boot off network disk, and contention makes the entire thing fall over.

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