[jiggawatts]

Most cloud customers don't pay on-demand retail prices. For example, Azure VM Reservations or Savings Plans typically provide a 50-65% discount. AWS has similar plans.

For example, instead of the ancient F8 series used in the article, a modern D8as_v5 Azure instance under a 3-year Savings Plan is $115/mo.

Also, the article compares CPX41 to EC2 and Azure VMs with dedicated cores, not shared cores. The CCX33 Hetzner model is closer to the normal clouds, and costs $50/mo, so now we're at 2x the price instead of 10x the price. (Conversely, the B8als_v2 size uses shared cores and is also 2x the price of CPX41 at $74/mo)

For that 2x cost you get a lot more features, first-party and third-party support, more locations, faster networking, etc... That's worth it for most large enterprises that care about ticking checkboxes on audit reports more than absolute cost. Or to put it this way: the annual price difference is just $600, which is the same cost to an org as half a day of engineer-time or less. If Hetzner is the slightest bit more difficult than a large public cloud VM for anything, ever, then it's not cheaper. This could be patching, maintenance, migrations, backup, recovery, automation, encryption, or just about anything else.

There are other differences as well. Hetzner has a separate charge for load balancers and IP addresses, whereas with Azure they're included in the price of the VM.

The biggest cost difference is that the public clouds charge eyewatering amounts for Internet egress traffic. Azure is about 100x as expensive as Hetzner, which is just crazy.

[mxuribe]

I certainly can't dispute the other points...but to me the AWS Savings plan always felt like vendor lock-in...and sort of like a virtual "on prem", in that i have to commit to something for X amount of time (like old school provisioning hardware and have it live for X time), and then i lose the flexibility of what i thought *the cloud* in general was supposed provide: that is, freedom to scale up, down or *out*, etc. I won't fault AWS and others for making their money; this is capitalism after all regardless of the vendor. I guess maybe the cloud sort of lost its shine, and it doesn't feel as liberating as maybe it once did, and both cost and complexity are overblown, maybe?

[jiggawatts]

It's the result of MBA-driven enshittification.

"In the beginning" the clouds promised to use their scale to soak up your unpredictable demand. You as the customer didn't have to think about capacity, or planning ahead, budgets, opex, etc... Just swipe your credit card and go from zero to any number you please and back again at any time of your choosing. Because there are so many other customers using the cloud with you, the unpredictable nature of your individual usage is averaged out and the cloud vendor gets a (slightly) noisy but manageable usage level of their resources. They have to work a little harder to predict future capacity needs, but you pay a premium for this.

"A little later" the MBAs realise that they can squeeze 5% more profit out of their customers with lock-in contracts that make everything "nice and predictable" instead of the stochastic noise they had to "deal with" before. Getting rid of that makes things a lot harder for you as the customer, but they don't care. They care about that 5%.

Ta-da... we're back at having to "procure", we're back at budgets that have to be planned for 3 years in advance, we're back at having to have time machines.

[mxuribe]

Bleh and yuck! I'm finding myself nodding in agreement with all that you stated, but not feeling good about it because of the reality of things! :-)

[jiggawatts]

The reality is that with the maximum discount, the public cloud is still 2x the cost of comparable hosting providers (including on-prem).

More realistically, I've found that the cost is between 3x to 7x what people were paying for before.

I'm not surprised cloud adoption has slowed to a crawl. Azure and AWS won't admit this publicly because it would tank their share price, but they can't hide it from observant people. For example, they used to get the latest Intel or AMD CPUs before retail availability in huge numbers. Now? They're 2-3 generations behind because they're not rolling out new servers in significant numbers. The customers are all tightening their belts because of the global economic downturn, and one of the most expensive things they've been splurging on before was public cloud hosting.