Comment by comrade1234
16 hours ago
15-years ago or so a spreadsheet was floating around where you could enter server costs, compute power, etc and it would tell you when you would break-even by buying instead of going with AWS. I think it was leaked from Amazon because it was always three-years to break-even even as hardware changed over time.
Azure provides their own "Total Cost of Ownership" calculator for this purpose [0]. Notably, this makes you estimate peripheral costs such as cost of having a server administrator, electricity, etc.
[0] - https://azure-int.microsoft.com/en-us/pricing/tco/calculator...
I plugged in our own numbers (60 servers we own in a data centre we rent) and Microsoft thinks this costs us an order of magnitude more than it does.
Their "assumption" for hardware purchase prices seems way off compared to what we buy from Dell or HP.
It's interesting that the "IT labour" cost they estimate is $140k for DIY, and $120k for Azure.
Their saving is 5 times more than what we spend...
Thank you, I've wanted to see someone use this in the real world. When doing Azure certifications (AZ900, AZ204, etc.), they force you to learn about this tool.
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If you buy, maybe. Leasing or renting tends to be cheaper from day one. Tack on migration costs and ca. 6 months is a more realistic target. If the spreadsheet always said 3 years, it sounds like an intentional "leak".
Did the AWS part include the egress costs to extract your data from AWS, if you ever want to leave them?
AWS says they will waive all egress costs when exiting https://aws.amazon.com/blogs/aws/free-data-transfer-out-to-i...
Because the EU forced them to
Well, somebody should recreate it. I smell a potential startup idea somewhere. There's a ton of "cloud cost optimizers" software but most involve tweaking AWS knobs and taking a cut of the savings. A startup that could offload non critical service from AWS to colo and traditional bare metal hosting like Hetzner has a strong future.
One thing to keep in mind is that the curve for GPU depreciation (in the last 5 years at least) is a little steeper than 3 years. Current estimates is that the capital depreciation cost would plunge dramatically around the third year. For a top tier H100 depreciation kicks in around the 3rd year but they mentioned for the less capable ones like the A100 the depreciation is even worse.
https://www.silicondata.com/use-cases/h100-gpu-depreciation/
Now this is not factoring cost of labour. Labor at SF wages is dreadfully expensive, now if your data center is right across the border in Tijuana on the other hand..