[carlineng]

[Disclaimer: former Snowflake employee]

Snowflake is not expensive because of perverse incentives, which is the primary claim of the article. It is expensive because it is a highly differentiated and very sticky product.

As others have mentioned, competition is the ultimate incentive to work on performance. Every dollar of Snowflake revenue is a dollar of revenue that Amazon, Google, Microsoft and Databricks are fighting for.

[klysm]

They aren’t exclusive. They also have perverse incentives to leave optimization gremlins in, even if they are very low hanging fruit to remove. They also have the incentive to not document them well.

[daniel-cussen]

Oh like injecting jitter so there's no consistency in measurement?

[discodave]

> Every dollar of Snowflake revenue is a dollar of revenue that Amazon, Google, Microsoft and Databricks are fighting for.

This is true, but misses one detail...

Snowflake runs in the cloud so every dollar of Snowflake revenue is roughly $0.40^1 of Amazon/Google/Microsoft revenue anyway.

^1: Snowflakes gross margin is in the range of 50-60% https://www.macrotrends.net/stocks/charts/SNOW/snowflake/gro...

[mejakethomas]

This, 100%.

It eats/consolidates formerly-disparate costs around the org. Because it's so good.

Which makes it look expensive.