Public Cloud And Its Effect On Companies Margins

Share post:

The increased expenditure on cloud computing infrastructure has a real impact, some of which involve a lot of wasted spending which could affect a company’s margin.

For a software start-up, there will be a point where it must have become more relevant to millions of users, and another point where spending on cloud computing could affect margin, as the cost of cloud computing infrastructure could take up a large share of the cost of revenue or cost of goods.

Martin Casado, general partner at tech investment firm Andreessen Horowitz, and Sarah Wang, partner at the firm, as they hoist a flag over public cloud spending, which is now increasing as the industry matures, note: “It’s becoming evident that while cloud clearly delivers on its promise early on in a company’s journey, the pressure it puts on margins can start to outweigh the benefits, as a company scales and growth slows. Those who have done this have reported significant cost savings: In 2017, Dropbox detailed in its S-1 a whopping $75M in cumulative savings over the two years prior to IPO due to their infrastructure optimization overhaul, the majority of which entailed repatriating workloads from public cloud.”

For more information, read the original story in ZDNet.



Related articles

Bell adds two cloud protection security services

Posture Assessment service looks for security gaps, while Posture Protection ensures configurations do

AWS to transition European Datacenters to hydrotreated vegetable oil

Amazon Web Services (AWS) has announced a plan to transition its European datacenters from diesel to hydrotreated vegetable...

Google introduces PaLM API and Makersuite prototyping tool

Google Cloud has announced that its artificial intelligence (AI)-powered applications, such as the Pathways Language Model (PaLM) API...

Deep Green offers free heat to businesses in exchange for edge servers hosting

Deep Green, a U.K.-based cloud startup, is offering to install its edge server hardware within organizations in exchange...

Become a member

New, Relevant Tech Stories. Our article selection is done by industry professionals. Our writers summarize them to give you the key takeaways