"During the last four years I’ve watched friends and acquaintances get burned by the cloud either due to down time or cost. We pay $3400 per month to host our 20 dedicated machines in a single rack. We have a gigabit connection to the Net and our average bandwidth throughput is around 125 megabits per second constantly. I’m tired of the Wired Magazine crowd giving me crap for not 'being in the cloud' or 'getting with the cloud' or whatever."
Mark, whose company runs its own servers and data center, throws down the gauntlet to cloud proponents:
"During the last 4 years I’ve had 99.9% uptime and I’ve spent a total of $190,000 during those 4 years on hosting, which includes the capital investment in the servers. We’ve had a constant throughput of 80 to 120 megabits per second (increasing over time) and roughly 40% avg CPU usage on 20 dual CPU machines (with dedicated Intel E5410 CPU’s each with 4 cores). ...we do 400 to 800 app requests per second and we also have an average of 25,000 concurrent connections on our front-end server. I’ll bet anyone who reads this a beer that you won’t find a cloud provider who can do this for you for less than 3X what I’ve paid. [That works out to $3,958 per month.]"
Cloud offers a tremendous amount of resources to startups and smaller companies that otherwise would be cost-prohibitive, at least at the initial investment phase. For larger companies, it's a way to get around the bean-counters when trying out new initiatives or pursuing innovation.
But there's nothing wrong with managing your own physical infrastructure, and Mark points out that it is ultimately a lot cheaper in the long run. This is a point that many larger enterprises continue to weigh in their systems decisions -- hence, the enormous interest in private clouds, in which a virtualized service layer is built to support (and hide) legacy and siloed systems. But it's still the company's own IT infrastructure.