Ultimately companies that abdicate their informatics operations like this will give their profits to their data-center operators, who will be empowered to charge them whatever price they want. Because what's their BATNA? Migrating from Azure to AWS when Microsoft doesn't want to let them?
Renting your information infrastructure is a great way to reduce startup costs, but down the road, that information infrastructure runs your company. Trying to outsource it is like trying to outsource upper management.
To be clear, I'm not saying that the optimal amount of cloud services for an established company like FedEx to buy is 0. They bring in management consultants, too. But it sure isn't 100%.
Without a doubt, a future generation of executives will revisit and reverse the decision to rent all information infrastructure, but that will likely be many, many years down the road. In the meantime, the current generation of executives who made this decision will look very smart for saving the company lots of money for a good number of years. And they stand to benefit personally from it. They're doing the rational thing!
You can say the same thing for hundreds of parts of a company like FedEx.
For example FedEx flies Boeing jets. It's completely reliant on Boeing for parts for those jets. Presumably Boeing can charge whatever it wants.
Your company is always going to be reliant on other suppliers and contracts. Unless you're planning on building your own independent country in some location that has all the natural resources you need.
>Renting your information infrastructure is a great way to reduce startup costs, but down the road, that information infrastructure runs your company. Trying to outsource it is like trying to outsource upper management.
This isn't a one size fits all thing. For a company like FedEx I don't see the advantage of owning their own data centers. They just don't have the scaling challenges that would require that. Data centers or information infrastructure as you put it does't fall within the core competency of FedEx, so I don't think it's a fair comparison to say its like outsourcing upper management. I think its more fair to so that FedEx building their own datacenters is like building their own roads to deliver packages on.
For a company like Facebook or Google, the difference is clear. They need to handle such a high scale of traffic and volume of data that they need custom infrastructure to be able to scale efficiently at significantly reduced costs. The same reason it made sense for them to invest in building their own databases, because the existing options didn't meet the scaling requirements. FedEx won't realistically be needing their own database or infrastructure any time soon.
Fedex does not create their own electricity or fuel either, yet without those they have no going concern. Yet they choose to acquire those services on the open market because it is cheaper, even though they do make themselves more dependent on the supplier. In the end, full self-sufficiency is just not viable for large companies in a highly specialized economy.
In this case, if a cloud provider gets too monopolistic then the BATNA for fedex is to re-hire (or train) enough sysadmins to run their own systems again. That puts an upper limit to how much a cloud provider can charge for their services, in addition the competition between Azure/AWS/GCP will also keep prices somewhat down. The cloud providers know this and will price accordingly.
> Because what's their BATNA? Migrating from Azure to AWS when Microsoft doesn't want to let them?
Uh yes, exactly?
Clouds give small customers the first hit free as a loss leader. With very large customers, clouds have to be price competitive because if you're at a large scale, it is totally worth spending millions of dollars for a 5 year plan to change clouds. The people who get screwed are the medium to large customers for whom the cost of changing clouds is too high to recoup in a reasonable timeframe. The moral of the story is be very small or very large, but avoid being medium sized.
As a startup, the greatest benifit of cloud compute isn't the fact that I can scale up at the push of a button, but that I can scale DOWN at the push of a button. I want to test things on beefy systems, but I don't want to have to pay for those systems any longer than I need to use them. To me, this is the single best thing about cloud compute.
Once your start up has become an established company and are so busy that you are no longer able to scale down regularly, it seems that's the time to start having your own compute vs continuing to line the pockets of the cloud providers.
But that's only really a change when you come from commodity hardware. For those still on mainframes, what's the difference? Technically the hardware might be charged per replacement cycle instead of monthly, but vendors are just as empowered to demand whatever they want. It's certainly hard to avoid lock-in running stuff on a cloud provider, but I suspect that it is even harder when depending on ye olde mainframe.
I do get your point, but if they have a fair amount of IBM mainframes, they are already renting their infrastructure. The mainframes have a culture of making you pay for operating system and other pieces on a basis of how much compute power you have "varied on". You don't really "own" a z-series box.
Making accurate calculations of data center cost is of course complicated and rarely manages to take everything into account, but the common knowledge I’ve heard is that there comes a point when a company is so large that going on-prem is what actually saves them a lot of money.
If FedEx is not large enough to be one of those companies, how large do you actually have to be? Or has cloud pricing changed to the point where this is no longer true, and even huge corporations can save money in moving away from their own premises?
It's not only about size, there's also workloads to take into consideration.
Take FedEx, their operations are highly dynamic - per day but also per period. The number of packages sent, and being transported, vary greatly between a random Tuesday 15:00 and the weeks before holidays.
In such a scenario, with your own infrastructure, you need to overprovision, by a lot, to be able to handle the heaviest load possible, and then some margin on top. And that capacity is wasted what, 90% of the year?
Meanwhile if you subcontract that part on AWS, it's their problem, and they can afford to handle it, and you only pay for what you actually use when you use it.
Maybe this is true for public cloud pricing but it hasnt been true for some time when it comes to enterprises on cloud. Large enterprises come in and ask for a quote for X cpus/ram/storage over X years. They sign a multi year contract with a guaranteed minimum spend, and a discount on every line item. Then they "lift and shift" their physical data center into a cloud region, in a very static way (no autoscaling etc).
This works great for everyone, the hyperscalars have much lower costs than even the biggest enterprise customers so the company get a good deal. And the cloud company makes some revenue off the minimum spend (making capacity planning a lot easier) and they know once the compute and storage there it will be very likely the company starts using extra managed services.
Running your own data centers is a form of vertical consolidation, which is a strategy. Specialization is the opposite strategy. A single company may strategically decide to specialize some things and vertically consolidate others.
The dollars-and-cents are details. Those matter, of course, but don't base your entire analysis there. Staying vertically integrated may help fedex be 4.713% more profitable today, but might miss out on important growth areas and become a dinosaur. Or maybe the important growth areas involve data center innovations, and staying vertically integrated allows them to exploit those opportunities. So it's not always an easy decision, but it involves more than the present-day costs.
It's not just money, it is also how you spend a limited quantity of organisational focus. You cannot do it all, this is actually even more important when you are that big of a company.
Technology scales faster than fedex's data needs. Maybe somewhere in the future the reverse trend happens as their needs can be met with very small servers. Though I've always been wary of putting your data somewhere because getting your data to a competitor costs alot of money.
The transition to “cloud” is often more about the culture and capabilities of a company than the technology. If you have been on some shitty mainframe and a bunch of other technology from the 60s you cannot bank on that carrying you for the next 20-30 years. The people that know that stuff are ancient, expensive, and retiring. “Cloud” is a very good opportunity to jettison the legacy burden and reinvigorate the technical competence of the org.
Its weird to have companies say they're moving from Mainframes to the Cloud.
The Mainframe is a sort of cloud, each one has usually double the spare capacity and you call IBM to unlock it.
The cost of running a Mainframe is measured in terms of MIPS based on amount of compute used and there's compute reserved for offloading things like JITs (zAAPS). Essentially a version of cloud compute costs.
I can understand if you're locked into COBOL with EBCDIC and can't find talent, but Z runs freaking Ubuntu now! I know IBM works furiously on modern ecosystem support.
Not shill for IBM, but what exactly is it that they're expecting to be so different from their cloud migrations? Or is everyone here caught up in the "Mainframe old" falsehood.
I doubt they have too much COBOL lock-in, since the article notes their datacenter opened in 2008.
Here's the thing: A mainframe may have spare capacity, but you still have to call IBM to unlock it. In order to make a Z run in a cost-effective manner, you need to run at 90%+ utilization at all times - which is excellent for batch jobs that can be scheduled, but is difficult to achieve with on-demand loads.
You're paying based on compute available, not just compute used (unless I'm misremembering our contracts back in the day). Sure, the amount of available capacity can be changed, but a phone call to big blue is not automated. Cloud autoscaling is.
You're right that IBM mainframes are far more modern and cost effective than we assume. Sadly, they are still behind the curve of cloud hosting.
> Its weird to have companies say they're moving from Mainframes to the Cloud.
Ever work for a company with their own datacenters that were NOT cutting edge? The work to provision resources can be so painful that it severely inhibits prototyping. Being able to spin up resources in seconds with some API calls is very valuable.
A lot of the cool tech that Linux and parts of cloud tech are crowing about are just new versions of stuff IBM was doing in the 1990’s. Sometimes I wish I knew some of those people, because I’m sure it would be fascinating to wind them up over a few beers and see what comes out of their mouths.
The fundamental issue with mainframes is that IBM made ramping up talent on mainframes extremely painful. Sure they run Ubuntu but how does one actually get a mainframe environment to learn on?
Mainframes are still king when it comes to transaction processing but having such a closed off ecosystem has screwed them.
Even FPGA's are more accessible to learn. On AWS you can spin up eg; an F1 instance and get a dev environment.
The difference may be that they're sticking with their own data center but they don't have a mainframe setup. Mainframes come with expensive, locked out hardware, expensive maintenance, expensive experts, you name it.
With modern open source tooling, ridiculously powerful graphics cards, easily accessible FPGAs and free data center hosting software like OpenStack, Kubernetes, and glusterfs you can replicate many of the features that made mainframes enticing many years ago.
It'll require a heck of a lot of work to get the same performance out of a custom built solution, but long term it's probably cheaper than relying on IBM.
I doubt that they'll be saving any money by moving to the cloud unless they're horribly inefficient with their contracts right now. Just moving away from mainframes alone should save a significant buck, but if they were planning on restructuring their digital infrastructure anyway then now is probably the best time.
That's how you do it. You don't stick with on-prem but just build your own cloud. At that size, AWS won't really buy hardware much cheaper than you. And while you can't build every cloud product that AWS has, the most popular ones are open source anyway.
Guessing they're not counting stuff at their flight sim training center (12 bays) as a 'data center'. There is zero % chance that the workloads supporting simulators are gonna run in the cloud. They're incredibly latency sensitive, extremely finicky, and just getting the stuff virtualized continues to be a struggle for aviation OEMs and flight training centers (though FedEx was a pioneer in this regard).
Granted, the footprint per sim bay isn't huge (1-2 racks, usually, sometimes 3), but it can add up at the larger sim facilities. Several of the major airlines are running 30+ bays simultaneously, with United poised to come in with the most at 40+ in the near future.
I left FedEx (Trade Networks) after 15 and a half years earlier this year. The entirety of that 15 1/2 years was spent using IBM AS/400 terminal to interact with various systems and was also used to submit paperwork to Customs and any other applicable government agencies to clear international freight.
It... was an experience.
I imagine that is going to take quite a bit of work to migrate over to someone else's servers, as I doubt they're going to be like "sure, we can accommodate your decade and a half old, mission-critical, systems"
I've seen two mainframe "replacements" fail to either retire the mainframe, OR produce an alternative system which people like. Has any Fortune 500 company successfully "retired" their mainframe?
Cue 10 years down the line, when everyone realizes cloud comes with tradeoffs in flexibility and reliability and they all move back to on-premise for business critical stuff.
It would be interesting to see the actual numbers on how much such a transition will cost.
Can their existing mainframe software and databases simply migrate into a cloud offering? If not, then if their planned transition has delays or technical hurdles, how much of that cost savings is affected?
If their cloud providers change pricing structures in future contract negotiations or if the amount of data they transfer in/out of each cloud provider location changes dramatically in order to better serve their customers, how much of that cost savings is affected?
It's clear that you can run a business with minimal amount of physical plant for servers. It's still not entirely clear to me that large established businesses can actually save money this way.
From an executive viewpoint, this would be a reasonable forcing function to overcome long, deep rooted stasis in your IT department.
Let's assume for a moment that modernization is good. It probably is wrt mainframes. For every team that refused to modernize, you can now drive them to the 2024 date, absolutely no exceptions.
Is there any gain here aside from cost saving? Will this saving be passed on to the customer? (laughs). What happens when the inevitable AWS outage then causes a global shipping bottleneck? Have we still not learnt that having sovereignty is better than saving money? Has COVID taught us nothing? sigh
I'm in corp land and this to me reads as the CIO using external PR to push internal agendas.
Are they really going to close all their on-prem datacenters in the next 2 years? Maybe.
More likely, this is a way to build momentum around the transition to cloud. Not a bad strategy, and not uncommon from what I've seen in the enterprise.
I'd bet Dropbox has way more raw bytes to store than FedEx. Plus, the Dropbox business model is based on data egress to clients, which is really expensive on cloud servers. FedEx needs data centers more for internal logistics, which is probably why they're going with Oracle.
Ask yourself what probably happened a few years later when they had to negotiate new leases from their datacenter landlords. Funny how they never put out a follow up press release about the enduring value of on-prem. Also a company that basically can’t grow and hardly turns a profit.
I wonder how much of that savings comes from closing data centers and how much from getting off IBM mainframes. It's hard for me to see why a company like FedEx would need to be spending anything like $400m a year on data centers unless a big chunk of that is paying IBM to rent their mainframes.
I never understood the logic behind companies abandoning their own data centers and moving their gold (Data is the new gold) into somebody else hand. I see that many here are also thinking in the same line.
But when I spoke to a CTO of a F500 company. This was the take he had. He feels one of the major driving force is to reduce the carbon foot print of the company. His company is designing the system to have the crucial data on their own infrastructure but keep they other data & do the processing of cloud service. Instead of relying on 1 provider, they are using multiple. Also supporting some small local cloud providers.
This seems very relevant for a logistics company with a huge of fleet of air craft. Especially considering the upcoming carbon tax.
I'm skeptical of the carbon footprint thing for a few reasons, but the other point is interesting and something I think about once in awhile. As we build out more and more bandwidth, compute, storage, and APIs to tie them all together, it seems that the world more resembles some sort of large computer and most of the work is just getting the data and compute closer together when needed and minimizing costs when it's not. I know I'm far from the first to have this realization.
I wonder how much of this is motivated by the lack of staff. The market of available mainframe operators has been drying up for decades. When your entire business depends on a technology nobody is willing to learn or go to school to understand, that creates a problem.
Also, from my understanding, it can take a tremendous number of distributed x86 systems to supplement the scale, speed and reliability of a mainframe. It's possible that unless FedEx gets away from managing storage arrays and hypervisor farms, they wouldn't have enough staff to operate the datacenters once they're full of enough servers to replace the mainframes.
The thing I see missing in the comments is that sourcing hardware over the past few years has been incredibly difficult. It will get better, yes, but that may have been the last straw to convince them to switch.
Past few years? Maybe the past 18 months it's been slightly more difficult but even at the beginning of COVID it wasn't hard to source most anything. And even during these more recent supply-constrained times, you can still source hardware it just might take a little longer for delivery or you might pay a bit more than you did before.
Another way of looking at at:
Where own data-center cost gets to high it might be due to lack of responsibility to act or inability to manage.
A company then have two options:
(a) replace/pressure top/middle management to get costs down and processes streamlined or, (b) move to the cloud. Its easier (and possibly good for your resume) to move to the cloud and then a few yours later -- decide again.
So moving to the cloud is sometimes an indicator of an inflexible/stale/mature company.
[+] [-] kragen|3 years ago|reply
Renting your information infrastructure is a great way to reduce startup costs, but down the road, that information infrastructure runs your company. Trying to outsource it is like trying to outsource upper management.
To be clear, I'm not saying that the optimal amount of cloud services for an established company like FedEx to buy is 0. They bring in management consultants, too. But it sure isn't 100%.
[+] [-] cs702|3 years ago|reply
[+] [-] chrisseaton|3 years ago|reply
For example FedEx flies Boeing jets. It's completely reliant on Boeing for parts for those jets. Presumably Boeing can charge whatever it wants.
Your company is always going to be reliant on other suppliers and contracts. Unless you're planning on building your own independent country in some location that has all the natural resources you need.
Non-argument.
[+] [-] menzoic|3 years ago|reply
This isn't a one size fits all thing. For a company like FedEx I don't see the advantage of owning their own data centers. They just don't have the scaling challenges that would require that. Data centers or information infrastructure as you put it does't fall within the core competency of FedEx, so I don't think it's a fair comparison to say its like outsourcing upper management. I think its more fair to so that FedEx building their own datacenters is like building their own roads to deliver packages on.
For a company like Facebook or Google, the difference is clear. They need to handle such a high scale of traffic and volume of data that they need custom infrastructure to be able to scale efficiently at significantly reduced costs. The same reason it made sense for them to invest in building their own databases, because the existing options didn't meet the scaling requirements. FedEx won't realistically be needing their own database or infrastructure any time soon.
[+] [-] WJW|3 years ago|reply
In this case, if a cloud provider gets too monopolistic then the BATNA for fedex is to re-hire (or train) enough sysadmins to run their own systems again. That puts an upper limit to how much a cloud provider can charge for their services, in addition the competition between Azure/AWS/GCP will also keep prices somewhat down. The cloud providers know this and will price accordingly.
[+] [-] earthboundkid|3 years ago|reply
Uh yes, exactly?
Clouds give small customers the first hit free as a loss leader. With very large customers, clouds have to be price competitive because if you're at a large scale, it is totally worth spending millions of dollars for a 5 year plan to change clouds. The people who get screwed are the medium to large customers for whom the cost of changing clouds is too high to recoup in a reasonable timeframe. The moral of the story is be very small or very large, but avoid being medium sized.
[+] [-] dylan604|3 years ago|reply
Once your start up has become an established company and are so busy that you are no longer able to scale down regularly, it seems that's the time to start having your own compute vs continuing to line the pockets of the cloud providers.
[+] [-] usrusr|3 years ago|reply
[+] [-] tyingq|3 years ago|reply
[+] [-] hnarn|3 years ago|reply
If FedEx is not large enough to be one of those companies, how large do you actually have to be? Or has cloud pricing changed to the point where this is no longer true, and even huge corporations can save money in moving away from their own premises?
[+] [-] sofixa|3 years ago|reply
Take FedEx, their operations are highly dynamic - per day but also per period. The number of packages sent, and being transported, vary greatly between a random Tuesday 15:00 and the weeks before holidays.
In such a scenario, with your own infrastructure, you need to overprovision, by a lot, to be able to handle the heaviest load possible, and then some margin on top. And that capacity is wasted what, 90% of the year?
Meanwhile if you subcontract that part on AWS, it's their problem, and they can afford to handle it, and you only pay for what you actually use when you use it.
[+] [-] cavisne|3 years ago|reply
This works great for everyone, the hyperscalars have much lower costs than even the biggest enterprise customers so the company get a good deal. And the cloud company makes some revenue off the minimum spend (making capacity planning a lot easier) and they know once the compute and storage there it will be very likely the company starts using extra managed services.
[+] [-] chmod600|3 years ago|reply
The dollars-and-cents are details. Those matter, of course, but don't base your entire analysis there. Staying vertically integrated may help fedex be 4.713% more profitable today, but might miss out on important growth areas and become a dinosaur. Or maybe the important growth areas involve data center innovations, and staying vertically integrated allows them to exploit those opportunities. So it's not always an easy decision, but it involves more than the present-day costs.
[+] [-] nuthje|3 years ago|reply
[+] [-] Out_of_Characte|3 years ago|reply
[+] [-] mberning|3 years ago|reply
[+] [-] lou1306|3 years ago|reply
[+] [-] filereaper|3 years ago|reply
The Mainframe is a sort of cloud, each one has usually double the spare capacity and you call IBM to unlock it.
The cost of running a Mainframe is measured in terms of MIPS based on amount of compute used and there's compute reserved for offloading things like JITs (zAAPS). Essentially a version of cloud compute costs.
I can understand if you're locked into COBOL with EBCDIC and can't find talent, but Z runs freaking Ubuntu now! I know IBM works furiously on modern ecosystem support.
Not shill for IBM, but what exactly is it that they're expecting to be so different from their cloud migrations? Or is everyone here caught up in the "Mainframe old" falsehood.
[+] [-] unregistereddev|3 years ago|reply
Here's the thing: A mainframe may have spare capacity, but you still have to call IBM to unlock it. In order to make a Z run in a cost-effective manner, you need to run at 90%+ utilization at all times - which is excellent for batch jobs that can be scheduled, but is difficult to achieve with on-demand loads.
You're paying based on compute available, not just compute used (unless I'm misremembering our contracts back in the day). Sure, the amount of available capacity can be changed, but a phone call to big blue is not automated. Cloud autoscaling is.
You're right that IBM mainframes are far more modern and cost effective than we assume. Sadly, they are still behind the curve of cloud hosting.
[+] [-] dan_quixote|3 years ago|reply
Ever work for a company with their own datacenters that were NOT cutting edge? The work to provision resources can be so painful that it severely inhibits prototyping. Being able to spin up resources in seconds with some API calls is very valuable.
[+] [-] bob1029|3 years ago|reply
It's probably this. I've spent time trying to advocate for the benefits of these systems, but its like shooting a super soaker into the sun.
[+] [-] hinkley|3 years ago|reply
[+] [-] mhh__|3 years ago|reply
[+] [-] alfalfasprout|3 years ago|reply
Mainframes are still king when it comes to transaction processing but having such a closed off ecosystem has screwed them.
Even FPGA's are more accessible to learn. On AWS you can spin up eg; an F1 instance and get a dev environment.
[+] [-] Aperocky|3 years ago|reply
you don't need to call AWS. Negotiate a blanket deal and do whatever you need. Run whatever you want. Unsure? Check billing page.
[+] [-] baud147258|3 years ago|reply
[+] [-] jchook|3 years ago|reply
https://www.businessinsider.com/bank-of-americas-350-million...
[+] [-] jeroenhd|3 years ago|reply
With modern open source tooling, ridiculously powerful graphics cards, easily accessible FPGAs and free data center hosting software like OpenStack, Kubernetes, and glusterfs you can replicate many of the features that made mainframes enticing many years ago.
It'll require a heck of a lot of work to get the same performance out of a custom built solution, but long term it's probably cheaper than relying on IBM.
I doubt that they'll be saving any money by moving to the cloud unless they're horribly inefficient with their contracts right now. Just moving away from mainframes alone should save a significant buck, but if they were planning on restructuring their digital infrastructure anyway then now is probably the best time.
[+] [-] dx034|3 years ago|reply
[+] [-] mbesto|3 years ago|reply
[+] [-] Spivak|3 years ago|reply
[+] [-] sithadmin|3 years ago|reply
Granted, the footprint per sim bay isn't huge (1-2 racks, usually, sometimes 3), but it can add up at the larger sim facilities. Several of the major airlines are running 30+ bays simultaneously, with United poised to come in with the most at 40+ in the near future.
[+] [-] ryanmercer|3 years ago|reply
It... was an experience.
I imagine that is going to take quite a bit of work to migrate over to someone else's servers, as I doubt they're going to be like "sure, we can accommodate your decade and a half old, mission-critical, systems"
[+] [-] TheRealDunkirk|3 years ago|reply
[+] [-] Aeolun|3 years ago|reply
[+] [-] bradfa|3 years ago|reply
Can their existing mainframe software and databases simply migrate into a cloud offering? If not, then if their planned transition has delays or technical hurdles, how much of that cost savings is affected?
If their cloud providers change pricing structures in future contract negotiations or if the amount of data they transfer in/out of each cloud provider location changes dramatically in order to better serve their customers, how much of that cost savings is affected?
It's clear that you can run a business with minimal amount of physical plant for servers. It's still not entirely clear to me that large established businesses can actually save money this way.
[+] [-] thedougd|3 years ago|reply
Let's assume for a moment that modernization is good. It probably is wrt mainframes. For every team that refused to modernize, you can now drive them to the 2024 date, absolutely no exceptions.
[+] [-] Thorentis|3 years ago|reply
[+] [-] chevman|3 years ago|reply
Are they really going to close all their on-prem datacenters in the next 2 years? Maybe.
More likely, this is a way to build momentum around the transition to cloud. Not a bad strategy, and not uncommon from what I've seen in the enterprise.
[+] [-] sschueller|3 years ago|reply
[+] [-] langsoul-com|3 years ago|reply
Surely FedEx would have a metric shit ton of data?
[+] [-] humanistbot|3 years ago|reply
[+] [-] jeffbee|3 years ago|reply
Really, not the first example I’d reach for.
[+] [-] tgflynn|3 years ago|reply
[+] [-] bythckr|3 years ago|reply
But when I spoke to a CTO of a F500 company. This was the take he had. He feels one of the major driving force is to reduce the carbon foot print of the company. His company is designing the system to have the crucial data on their own infrastructure but keep they other data & do the processing of cloud service. Instead of relying on 1 provider, they are using multiple. Also supporting some small local cloud providers.
This seems very relevant for a logistics company with a huge of fleet of air craft. Especially considering the upcoming carbon tax.
[+] [-] hotpotamus|3 years ago|reply
[+] [-] treesknees|3 years ago|reply
Also, from my understanding, it can take a tremendous number of distributed x86 systems to supplement the scale, speed and reliability of a mainframe. It's possible that unless FedEx gets away from managing storage arrays and hypervisor farms, they wouldn't have enough staff to operate the datacenters once they're full of enough servers to replace the mainframes.
[+] [-] fsociety|3 years ago|reply
[+] [-] bradfa|3 years ago|reply
[+] [-] bosveld|3 years ago|reply
A company then have two options: (a) replace/pressure top/middle management to get costs down and processes streamlined or, (b) move to the cloud. Its easier (and possibly good for your resume) to move to the cloud and then a few yours later -- decide again.
So moving to the cloud is sometimes an indicator of an inflexible/stale/mature company.