The cloud has delivered amazing benefits like on-demand infrastructure that’s easy to use, pay-as-you-go subscription plans, and effortless scaling of applications. This flexibility minimizes the growing pains for businesses and explains why today’s startups and established companies are both building apps on the cloud.
However, the costs of using the cloud stack up once companies reach large scale. Dropbox, for example, shifted away from the cloud in 2016 to opt for a custom built infrastructure in co-location facilities. They saved $75 million over 2 years and increased their gross margins from 33% to 67% due to this change. Actually, recent research suggests major companies spend 75%-80% of cost of revenue on their cloud bills. Should large companies shift away from the cloud like Dropbox did? Is it too late for some companies to untangle themselves from it?
In this episode we talk with Martin Casado, Partner at Andreessen Horowitz and an expert in IT Infrastructure. We discuss the costs of cloud for small and large companies, and the financial implications of cloud infrastructure at scale.
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