An interesting question, so time for some 100% speculation.
It sounds like they probably have revenue in the €500mm range today. And given that the bare metal cost of AWS-equivalent bills tends to be a 90% reduction, we'll say a €10mm+ bare metal cost.
So I would say a cautious and qualified "yes". But I know even for smaller deployments of tens or hundreds of servers, they'll ask you what the purpose is. If you say something like "blockchain," they're going to say, "Actually, we prefer not to have your business."
I get the strong impression that while they naturally do want business, they also aren't going to take a huge amount of risk on board themselves. Their specialism is optimising on cost, which naturally has to involve avoiding or mitigating risk. I'm sure there'd be business terms to discuss, put it that way.
Why would a client who wants to run a Blockchain be risky for Herzner? I'm not a fan, I just don't see the issue. If the client pays their monthly bill, who cares if they're using the machine to mine for Bitcoin?
They are certain to run the machines at 100% continually, which will cost more than a typical customer who doesn't do this, and leave the old machines with less second-hand value for their auction thing afterwards.
I’d bet that main reason would be power. Running machines at 100% doesn’t subtract much extra , but a server running hard for 24 hours would use more power than a bursty workload.
Also very subject to wildly unstable market dynamics. If it's profitable to mine, they'll want as much capacity as they can get, leading Hetzner to over provision. Then once it becomes unprofitable, they'll want to stop all mining, leaving a ton of idle, unpaid machines. Better to have stable customers that don't swing 0-100 utilization depending on ability to arbitrage compute costs.
I wouldn't be surprised if mining is also associated with fraud (e.g. using stolen credit cards to buy compute).
Netflix might be spending as much as $120m (but probably a little less), and I thought they were probably Amazon's biggest customer. Does someone (single-buyer) spend more than that with AWS?
Hertzner's revenue is somewhere around $400m, so probably a little scary taking on an additional 30% revenue from a single customer, and Netflix's shareholders would probably be worried about risk relying on a vendor that is much smaller than them.
Sometimes if the companies are friendly to the idea, they could form a joint venture or maybe Netflix could just acquire Hertzner (and compete with Amazon?), but I think it unlikely Hertzner could take on Netflix-sized for nontechnical reasons.
However increasing pop capacity by 30% within 6mo is pretty realistic, so I think they'd probably be able to physically service Netflix without changing too much if management could get comfortable with the idea
A $120M spend on AWS is equivalent to around a $12M spend on Hetzner Dedicated (likely even less, the factor is 10-20x in my experience), so that would be 3% of their revenue from a single customer.
> A $120M spend on AWS is equivalent to around a $12M spend on Hetzner Dedicated (likely even less, the factor is 10-20x in my experience), so that would be 3% of their revenue from a single customer.
I'm not convinced.
I assume someone at Netflix has thought about this, because if that were true and as simple as you say, Netflix would simply just buy Hetzner.
I think there lots of reasons you could have this experience, and it still wouldn't be Netflix's experience.
For one, big applications tend to get discounts. A decade ago when I (the company I was working for) was paying Amazon a mere $0,2M a month and getting much better prices from my account manager than were posted on the website.
There are other reasons (mostly from my own experiences pricing/costing big applications, but also due to some exotic/unusual Amazon features I'm sure Netflix depends on) but this is probably big enough: Volume gets discounts, and at Netflix-size I would expect spectacular discounts.
I do not think we can estimate the factor better than 1.5-2x without a really good example/case-study of a company someplace in-between: How big are the companies you're thinking about? If they're not spending at least $5m a month I doubt the figures would be indicative of the kind of savings Netflix could expect.
We run our own infrastructure, sometimes with our own fincing (4), sometimes external (3). The cost is in tens of millions per year.
When I used to compare to aws, only egress at list price costs as much as my whole infra hosting. All of it.
I would be very interested to understand why netflix does not go 3/4 route. I would speculate that they get more return from putting money in optimising costs for creating original content, rather than cloud bill.
> I would be very interested to understand why netflix does not go 3/4 route. I would speculate that they get more return from putting money in optimising costs for creating original content, rather than cloud bill.
I invest in Netflix, which means I'm giving them some fast cash to grow that business.
I'm not giving them cash so that they can have cash.
If they share a business plan that involves them having cash to do X, I wonder why they aren't just taking my cash to do X.
They know this. That's why on the investors calls they don't talk about "optimising costs" unless they're in trouble.
I understand self-hosting and self-building saves money in the long-long term, and so I do this in my own business, but I'm also not a public company constantly raising money.
> When I used to compare to aws, only egress at list price costs as much as my whole infra hosting. All of it.
I'm a mere 0,1% of your spend, and I get discounts.
Of course netflix is optimising costs, otherwise it would not be a business, I just think they put much more effort elsewhere. They could be using other words, like "financial discipline" :)
My point is that even if I get 20 times discount on egress its still nowhere close, since i have to buy everything else - compute, storage are more expensive, and even with 5-10x discounts from list price its not worth it.
(Our cloud bills are in the millions as well, I am familiar with what discounts we can get)
How is this reasonable? At what point do they pull a Dropbox and de-AWS? I can’t think of why they would gain with AWS over in house hosting at that point.
I’m not surprised, but you’d think there would be some point where they would decide to build a data center of their own. It’s a mature enough company.
I'm largely just thinking $HUGE when throwing out that number, but there are plenty of companies that have cloud costs in that range. A quick search brings up Walmart, Meta, Netflix, Spotify, Snap, JP Morgan.
The more you struggle at something the more you will learn. That works up to the point where the struggle is beyond your capacity for struggle - then you just get stuck. So ideally (assuming you are doing this because you want to learn something) you want to reduce the amount of struggle to just below your capacity.
Just copying someone else's solution, or getting an LLM to fix it for you will be very low struggle, so you won't learn much.
To add some struggle, maybe look up a solution in a different language and translate to your language? You could choose a solution in a language similar to your language, so if you are solving in C, perhaps look up a C# solution or to make it harder look up a solution in a different paradigm. Find a Haskell solution or a Prolog one and see if that gives you enough hints.
I can see the benefit of the struggle, but in relation to Day 1 Part 2 I literally had no clue why what id written wasn't working or what I needed to do to fix it.
I'm using nushell this year for AoC. It's functional by nature though you can make it imperative, so it's out of my comfort zone.
However the problem is math based whatever language you're using, involving modulo and int division. I had an hunch it was about that but no sense of what to do or how to approach.
Having looked at multiple ways of doing it I still have no clue what's going on, only that it works.
Ask for help explaining it. Check if a similar question has been asked already, but if not post your code to the subreddit and ask for help understanding why it works. The subreddit is friendly, people will answer if they see the question and can understand the code.
I've now done probably close to 100 system design interviews. One of the main things I've looked for in candidates is their ability to identify, communicate, and discuss trade-offs. The next thing on my checklist is their ability to move forward, pick an option, and defend that option. Really nimble candidates will pivot, recognizing when to change approaches because requirements have changed.
The goal here is to see if the candidate understands the domain (generic distributed systems) well enough on their own. For more senior roles I look to make sure they can then communicate that understanding to a team, and then drive consensus around some approach.
> For more senior roles I look to make sure they can then communicate that understanding to a team, and then drive consensus around some approach.
This is why I’m stuck at Senior lol. I can craft incredibly deep technical documents on why X is the preferred path, but when inevitably someone else counters with soft points like DX, I fall down. No, I don’t care that the optimal solution requires you to read documentation and understand it, instead of using whatever you’re used to. If you wanted to use that, why did you ask me to do a deep-dive into the problem?
This only seems to be in software engineering. When I was told me wanted to evaluate a new task queue service, I asked what our constraints were. I was told to survey all options and present a roundup and ignore constraints. Contrast with something like, I don't know, building a house. Do architects consider all possible material choices for a given location, or do they instead limit their consideration to materials that would be suitable to the given environment?
Making the dependencies of "it depends" explicit is the whole point.
Having built single family houses before I can tell you that architects consider only the choices they know. That is why were I live there are 1000 stick framed houses for every one built with something like SIP (structural insulated panels), or ICE (insulated concrete block) even though the others are similar cost to build with overall and have some useful advantages for the customer that often would make them a better deal for the homeowner long term.
This also means there are 100 builders in my area who only build stick frame houses and won't even talk to you if you want something else and only 1 or 2 who will even think about those other options. (they do compete with the other builders so costs are not unreasonable)
This tracks with my experience with architects (for home renovations): they use what they know, sometimes stubbornly so and even when I must point out it won't work out (e.g. materials inappropriate for the climate, inappropriate due to exposure to direct sunlight or water, obsession with visuals over practicality, etc).
I've dealt with enough architects by now to know this is the rule and not the exception.
A well implemented system would somehow allow you to use your ID to prove you have the attributes a service needs (being over 18, able to drive, no criminal records, not a communist or whatever it is they need) without providing any further information that would allow multiple services to correlate ID's against eachother.
Making confirmations of those attributes easily available will only result in more services requiring them. It's not worth the convenience for the vanishingly few cases where such a verification is actually beneficial.
The actual fines for this moving forward are up to 10% of a companies global revenue. The EU made a big point to say that this is the first time they are issuing those fines and as a result they are smaller than they otherwise would be especially in the case of repeat offenders.
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