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Microsoft: Cloud services demand up, prioritization rules in place (zdnet.com)
478 points by pul 62 days ago | hide | past | web | favorite | 259 comments


First of all, I'm curious to what proportions this is driven primarily by remote office work (O365), videoconferencing streaming, recreational video streaming (does Disney+ run on Azure?), or what.

But second... I'm fascinated by the concept of prioritization rules in place rather than simply raising prices. I wonder if it "looks bad" to raise prices, or if the vast majority of customers already have locked-in prices contractually so that raising prices has little effect. But I'd always thought that with AWS's spot pricing and so forth, that auction-style dynamic pricing was a core feature of clouds.

It would certainly look bad, and I think it would potentially be illegal in some states.


For example, Georgia:

> Selling items or services determined by the Governor during a declared state of emergency to be necessary for public safety at a higher cost than they were immediately prior to the declaration.


> For any supplier of a "necessary property or service" to "profiteer from a disaster" by charging 25% or more than the pre-disaster price for such goods/services.


> Selling goods/services during a declared state of emergency (within the designated emergency area) in excess of the ordinary price range immediately before the declaration.


> Selling goods and services at above the prices normally charged during a declared state of emergency (or what was charged immediately preceding the declaration).


Also consider that raising prices would itself be a form of prioritization, just prioritizing ability to pay over need.

I don’t know how I feel about this. In the general case, I feel like price gouging during emergencies is unethical.

But, when there is a non-artificial supply and demand issue, I struggle with the derivative effects of these policies.

My concern is that rather than simply evaluating on the consumers ability to pay (and backwards-looking at prior statements instead of increased go-forward costs), these policies add only one additional criteria: ability to threaten legal issues. Thus, it’s only effect is to prioritize government agencies alongside wealthy clients. And that’s just governments using force to get better treatment. Which also feels unethical.

But maybe there’s a happier and healthier read of the situation.

Governments will also exert this force on behalf of their citizens, is the happier read. In a disaster, everything becomes finite, but profiteering is still deeply disruptive to the shared societal fabric.

Yep - if there's N capacity to provide a necessary necessary good/service, but M > N need, raising the price doesn't seem like a great solution to manage it in a crisis situation. To some extent non necessary uses would decrease, but you also end up with more wealthy people who want it more getting it, and more generally there won't be any distinction between want and need.

> if there's N capacity to provide a necessary necessary good/service, but M > N need, raising the price doesn't seem like a great solution to manage it in a crisis situation

Within a crisis, yes. But this also did-incentivises overprovisioning, i.e. building slack into the system.

Not speaking in general terms, but just for cloud services—it’s just bananas expensive to overprovision at a cloud provider.

The more profitable (and ecological) way to run a cloud provider is to provision only for the capacity that you need, and then pack your machines with low-priority tasks with lower guarantees where you can simply start load-shedding in a crisis.

There are thousands of businesses that will look at EC2 spot pricing and simply not schedule their jobs above a certain price point, and I’m sure all the cloud providers have internal workloads running at lower priority (e.g. transcoding YouTube meme compilations) that will run at reduced capacity. Personally I think the whole thing is kind of elegant, even if there are a lot of rough edges in practice.

Just like outside a crisis situation.

Possibly, but in a crisis situation it is quite a bit more important to deliver adequate service to the "need" group. Outside of a crisis, the "need" group can pursue less expensive alternatives at their leisure. Right now, "fast" is critical.

And outside of a crisis situation demand patterns change much more gradually - long enough for manufacturers to ramp up production, more competitors to emerge etc. The normal feedback loops that make core goods available to the masses don't have time to happen right now.

Precisely. It seems like most manufacturing & supply chains have some elasticity for increased demand, e.g., toilet paper manufacturers were able to increase production either 10% or 20% very quickly (I forget which), but after going all out with 24 hour shifts, you can't do much more in the short term. Also, the more companies that have to do this, the more likely there will be correlated supply chains that feed those companies their raw materials, meaning the issue contaminates the supply & logistics process one more link up the chain.

Why do you think governments would only sue on behalf of themselves? The point of these laws is to allow attorneys general to sue on behalf of their constituents. Random example: https://www.standardspeaker.com/coronavirus/state-attorney-g...

Almost all emergency-related profiteering is about non-artificial supply and demand issues. Grocery chains charging 10x as much for water or toilet paper is exactly the kind of thing these laws are meant to prevent.

(If the shortage is long-term, you'll usually want to implement a rationing system to address the shortages, but in the short term this kind of fiat can work.)

Ignoring the implementation issues, my issue is when the vendor profits of limited supply in a crisis.

If the supplier is only passing on their own increased costs then that's at least fair in principle. Similarly, marginal increases in price for marginal increases in use also seems fair when there are demand surges.

The additional dimension is time-smoothing. Emergency declarations that solely serve to smooth over a few weeks spike can be effective. There does not appear to be a predictive estimator whether emergency declarations will be appropriately time limited.

my father , a Depression Era banker, observed : "who asks How Much is fine but the man who asks When you are paying him is finished."

Government has to smooth time.

>>I don’t know how I feel about this.

Your feelings aside it is probably illegal as this is an emergency, and MSFT's PR would take a major, major beating.

So MS is probably hiring by the thousands trying to meet demand. You raise prices when a hurricane or a pandemic hits, if you don't want to be around for a long time.

I find price gouging to be perfectly normal and perhaps even desirable during times like these. If the toilet paper prices go up drastically people will not be able to hoard it the way they are doing today.

People will still be able to hoard things. The difference is that only the rich will hoard, because everybody else never got the chance.

The normal market logic that high prices encourage extra production doesn't apply during an emergency, when the demand is panic-induced and momentary, and supply changes won't take effect until after the emergency is over.

The actual solution that makes sure everyone gets what they need and theres no hoarding is rationing: limit the number that one person can buy. And that's exactly what most grocery stores are doing.

How is rationing working? supply is still not enough and rationing on that basis still doesn't prevent the "rich" from effectively paying straw purchasers to buy the goods they want to hoard. Hell, it doesn't even prevent people from repeatedly making visits to collect whatever is on the shelves.

I'm not convinced the US government, let alone any western government, has the plan, manpower or infrastructure in place to actually take over distribution of essentials in fair quantities.

What do you mean? Rationing is working fine in the stores that are implementing it, the problem is that so many stores aren't. My local grocery is rationing paper products, milk, chicken, and eggs, and they're always available if you visit before noon.

There is no supply problem for consumer products. The shortages you see at grocery stores are exclusively because of panic-buying and hoarding, the shelves are stocked right back up to full overnight.

variable pricing for volume - reverse discounts, in effect - might have worked well.

buying 1 pack of TP? $2. 2 packs? $5. 3 packs? $12. etc.

The people that truly need 1 or 2 can afford those. The people that want to buy 10 or 20 at a time will pay a huge premium, enough such that it won't really even be easy for them to turn a profit trying to resell to the people who got there 10 minutes after them.

Ability to pay is only one aspect of demand. There’s also how much you actually want it, and the amount of opportunity cost you’re willing to pay. Keeping prices artificially low keeps demand artificially high, while supply doesn’t increase, or cannot increase if it’s inelastic.

> There’s also how much you actually want it, and the amount of opportunity cost you’re willing to pay.

Money doesn't have much relation to opportunity cost in the presence of enormous wealth inequality. An unemployed person willing to pay their entire bank account of $100 for some good clearly wants it more than a work-from-home tech worker willing to pay the $600 they made yesterday.

The same applies to businesses using cloud services. A struggling local business has a ludicrously low cap on what they can pay for Teams compared to Walmart or something.

You've just described how a monetary system works and have not refuted the link between prices and opportunity cost.

The unemployed person in my scenario is willing to forgo the opportunity to buy food, pay rent, or buy literally anything else. The tech worker is paying a negligible opportunity cost, as they have tens of thousands in their checking account and paying $600 has no effect on their ability to purchase food, rent, or anything else they want.

If I as the merchant believe the amount of money someone is willing to pay is equivalent to the opportunity cost they're willing to incur, I have to assume the person offering $600 wants it more.

I'm not sure "opportunity cost" is the correct term for what the OP wanted to say, since it usually refers to the (theoretical) loss incurred by choosing one alternative over another. The point is simply that a consumer's ability to pay is not necessarily a reflection of their need of the product. That's not an argument to blithely decouple pricing from supply and demand, but it's a recognition of a problem that a market-based society needs to deal with under extraordinary conditions.

Opportunity cost is everything you choose to forgo when you choose to allocate any resources to anything. If supply and demand is allowed to have its normal influence on price, then you can decide what you actually have the most demand for, and allocate your resources accordingly. The decisions you make regarding your own needs are always going to be much more efficient than those that any rationing authority could ever make.

That presumes the outdated notion of perfectly rational consumers. Economists have discovered that consumers aren't rational anyway, but in the case of a pandemic the likes of which western consumers have never seen, I can assure you that consumers are anxious. Some consumers are even panic buying, and their purchasing habits are consequently even more irrational than usual. Even assuming you and I both manage to stay rational, other customers hoarding will affect our respective purchasing powers. (Tbh I'm not immune to group psychology which means panic buying.)

When a hoarder has a 5 years stockpile of TP and others have none, that's obviously inefficiently allocated in a time of need. Given that we've seen that the is market unable to handle panic buying and hoarding in (perceived) emergencies, strict allocation of certain necessities during an emergency really does seem like the easiest way to equitably handle the situation. More creative solutions may exist, like volume purchase surcharges, as seen in a Danish store [1], but by and large, "limit 1 per customer" seems entirely reasonable. (For whatever value of 1 is appropriate for a particular product.)

[1] https://nypost.com/2020/03/21/danish-store-instills-pricing-...

But you’re not describing an irrational actor. If the entire global economy collapsed (which is not an irrational fear to have), then having several months supply of non-perishable food, cleaning and hygiene supplies would be very valuable thing. What makes that either rational or irrational is the expense you went to purchase them. If prices are not allowed to rise to equilibrium, then that expense is going to be very minimal.

As I’ve said several times. I think it’s perfectly reasonable to ration certain staples, and essential services. Everything else should just be priced to supply and demand. It’s not reasonable to call something price gouging if there are actually shortages.

(1) That is not the definition of "opportunity cost" that economists commonly use.

(2) As I often see when people make the case you're making, you are making unwarranted assumptions about the rationality of buyers. If people are fleeing a hurricane and the gas station raises the price sharply because of the demand, what can happen (and we've seen it happen, in fact) is that it encourages hoarding: it is now a precious commodity and those who can afford to buy it do so, denying it to others.

(3) As I also often see when people make the case you're making, you're also inserting a Big Bad Government Guy into the scenario, your "rationing authority," which people making my case aren't necessarily suggesting at all: we're suggesting that it is rational for suppliers to choose to ration goods in order to be able to meet the demand of a greater number of customers, rather than to meet only the demand of shoppers who can buy as much of [thing in short supply] as possible. Again this is what we actually see in practice, at this very moment: stores in my local area limiting the number of certain items you're able to buy at one time are not doing so because they have been ordered by the California Politburo to do so, they are doing so because on balance they can serve a greater number of customers, rather than turning away literally thousands of desperate people who couldn't "allocate their resources" as well as the guy with five Ultra Transparent Titanium Master Cards.

(1) that is the precise definition of opportunity cost. It is everything you forgo the opportunity to do whenever you choose to do anything. Whether you are choosing how to spend your money, or spend your time, or devote your attention, or expend your energy. All of those are opportunity cost decision. It also includes everything you forgo for any given decision. If you choose to buy a Ford, perhaps the opportunity cost could be that you don’t buy a Chrysler. But it could also be that you don’t eat out as often, because you have to make car payments, or that you don’t buy a PlayStation. It is all of those things. This is the definition used in the field of economics.

(2) raising prices will always reduce demand, outside of the very specific circumstances where demand is inelastic. Supply and demand is an inescapable law of economics, and subverting it will always result in failures in the supply chain. The scenario you described will also not increase hoarding, it will most certainly decrease it (whether arbitrage trading crops up is a different issue, but one that is completely unrelated to hoarding).

(3) I used the term rationing authority because it was a neutral descriptor. Anybody who acts as an authority on allocation rations is going to be creating the same inefficiencies (though you’d expect the parts of the supply chain closest to the consumers to be the least inefficient)

Most of what you’ve said has demonstrated serious misunderstandings of how the basic principles like supply and demand and opportunity cost works. Your argument that raising prices increases demand should really just be dismissed off the bat.

> The decisions you make regarding your own needs are always going to be much more efficient than those that any rationing authority could ever make.

If that were true, then hoarding wouldn't happen in the first place. You're obviously wrong here, and there's abundant evidence that consumers don't always make the best choices for themselves. Try scaling back your claims to something less absolute.

The hoarders benefit massively from hoarding. They benefit from a regulation that prevents the markets from responding to shortages and spikes in demand. They have no problem whatsoever deciding how to allocate their resources in that situation, which is the entire problem, because the market doesn’t force them to.

An individual will always, every single time, without fail, know what they need better than a 3rd party who nominates themselves to make decisions on behalf of others. If you remove market forces from the situation, and establish an authority to decide who gets rationed what, it will always impact the efficiency of those resource allocation decisions.

"An individual will always, every single time, without fail, know what they need better than a 3rd party who nominates themselves to make decisions on behalf of others"

This is completely false. Most individuals in a panic buying situation never know what they really need compared to a calm, educated and knowledgeable 3rd party. This crisis has also proved your assertion wrong - witness the mass buying of perishable foods and toilet paper.

Food that was thrown out in a weeks time into garbage and food that was denied to others because of panic buyers.

> This crisis has also proved your assertion wrong - witness the mass buying of perishable foods and toilet paper.

It hasn’t at all. For starters, non-perishable food was absolutely the first to vanish off the shelves. But that aside, buying too much has no detriment at all to the purchaser. The risk that they may not consume all of it is so incredibly minimal compared to what they’re actually worried about. This is only possible because prices are artificially constrained. Most people don’t have to face a considerable opportunity cost when buy way more food than they need.

lenkite 61 days ago [flagged]

I’d consider providing essential services to low income people disadvantaged during a crisis to be a seperate issue all together. I’d also suggest that such an issue would only apply to a narrow band of essential products and services. An unemployed person with $100 in their account isn’t going to care about how much access they have to high quality video conferencing. However, if I have the option of using a 12 person video conference for my morning standup, why wouldn’t I use it? If there was an additional cost for every video conference I wanted to have, I’d think more judiciously about when to use it. Which sounds better than the current situation of knowing that video conferencing is simply going to be unreliable and slow, regardless of how much I may need it for any particular meeting.

It doesn't matter if demand is artifial if there's a filter in place to allocate resources on a need-basis. Not matter the demand from non-need customers, they won't get it, or get less of it. The point in a crisis isn't to let markets find a natural equilibrium, which could mean it stabilizes into a state that isn't optimal to public health. On a crisis, the point is to prioritize those usages that will deal with and help lessen the crisis.

What mechanism do you plan to use to determine the severity of a need?

I've laid out a basic structure for my stance already so let me turn the question back to you: Do you feel that traditional market forces, with hoarding, panic buying, and price gouging at the same time health care providers run out of PPE, ventilators and other equipment... Do you feel the market forces are working in a way that best serves resolving this crisis and helping those in medical peril?

The basic structure of your approach is a vague idea that falls over in all sorts of ways once you attempt to put it into practice. Your comment is also conflating many different issues together. Contrary to your claim, I don’t think the general public has been rushing out to panic buy ventilators, or other heavy duty medical equipment. The government assuming an elevated level of control over the supply chain for medical PPE is also a completely different proposition to allowing Microsoft to increase the costs of video conferencing to properly scale to demand.

The phrase “panic buying” is really just a way to confound discussion about what’s really happening. There is a perfectly legitimate increase in demand, and a perfectly legitimate decrease in supply. If you wanted to stop people from hoarding, allowing market forces to respond to those changes would certainly shut it down. Any centrally enforces rationing policy is going to be far less efficient. The distinction between essential products and services, and non essential ones is also very real. You may choose that for any particular category of product or service, that the benefits in providing stability through rationing outweigh the costly efficiency trade offs. However that doesn’t obviously apply to every category of product or service under the sun.

The trade offs in efficiency are two fold. Firstly, the rationing authority has no effective way to gauge the actual needs of any person or organisation. So they will unavoidably end up allocating too much to some and not enough to others. Secondly, the market will typically respond to increased prices by increasing production. By keeping prices artificially low, you completely remove that incentive, and if the costs of production have risen (as they have), then you end up trying to manage the shortage by applying downward pressure on supply.

Finally, the issue of people not being able to afford the basic necessities of life is completely separate to that of supply and demand. There always have been and always will be people in that boat, regardless of whether there’s a global crisis taking place or not. In developed countries those people receive increased government assistance. I’ve never heard anybody seriously suggest that we should instead engage in mass price fixing to reduce the price of everything, rather than simply providing that assistance.

> prioritize those usages that will deal with and help lessen the crisis

Who is responsible for that decision? Do they become a bottleneck? Might they make mistakes? Are they susceptible to corruption? If so, it may be more wise to distribute that decision-making... via the market system.

The market system has, so far, benefited hoarders to the detriment of health care providers that need it more. Under normal circumstances, the market system would be just fine. In a crisis, something else is needed on top of normal market forces, which may still play a part for whatever resources are left after they reach those that truly need it.

As for who is responsible for that decision, it's a role the government generally fills. Can it be a bottleneck? Yes. But there are extreme bottlenecks now with hospitals already out of, or about to run out of, PPE and ventilators. Might there be mistakes? Sure, but again there are mistakes right now too, with market forces favoring those who can pay, have inside connections, etc., instead of those who need the resources. In short, the detriments you cite are a reality of any system, while their presence during a crisis can be mitigated at least a little, and help critical need be filled at least a little bit easier.

Don't let the desire for a "perfect" allocation system blind you to one that is merely "better" than what we currently have now with panic buying, hoarding, price gouging, etc.

Does this regulation applies to the entire supply chain? Otherwise it might become unreasonable to produce some goods at all if component cost raises too much.

If you are making bread and suddenly price of flour increases by 600%,so you have to increase your prices. Unless you are based in a country run by some delusional autocrat, you'd be fine. If, however,the supply chain is fine, i.e. your toilet paper supplier, however you end up selling it for 500% price because people can't seen to have enough of it- the the laws would apply.

Unfortunately these "delusional autocrats" run the government of, for example, Georgia, Kansas, Louisiana, Mississippi, etc. and would absolutely punish such a baker.

I highly recommend that you read through the legislation. The legislation explicitly allows prices to increase due to actual increases in costs. The only thing that's banned is increases in price due to increased profit margins.

Price gouging rules also keep people from speculatively ramping up production at the stage where it might be needed but you're not sure yet: https://www.jefftk.com/p/price-gouging-and-speculative-costs

In this case, they'd be likely to look at the upstream suppliers.

Do you think Louisiana has Republican governor?


Same with the exceptions to shelter-in-place for the suppliers of essential service providers.

Yeah. The result of anti-price-gouging laws is that when businesses' operating costs rise, they are forced to stop operating instead of increasing prices.

Most states specifically exclude price increases based on increased prices from suppliers or other increased expenses from the vendor and well as increased costs internally (e.g. having to cover increased overtime). Not saying it wouldn't be litigated, but if you can show that it costs more to provide these services when more people want them, it's a pretty clear exception and completely reasonable. But even then the general range of prohibition seems to be 15-25%. 25% is a huge jump, would they even need to increase prices that much to cover everything?

Isn't limiting availability also covered by laws ? Why should we pay the same price for limited service ? (Unless that's covered by their ToS?)

In the short term it might look bad. But in the long term it would encourage other companies to enter the market and existing players to increase their capacity.

You are assuming that economics for such continue to make sense after the crisis is over, which I sincerely doubt.

That still leaves a 24% gap.

I wonder how many masks would be floating around by now if there were no laws or public shaming for raising prices in an emergency.

Something something mythical man-month.

I have an entire Costco package of toilet paper that will last me months while some poor bastard near me is probably wiping his ass with his hand (or worse, flushing paper towel and causing thousands of dollars of damage) because there is no effective way for me to resell my excess in a way that is legal and won’t result in crazy social media backlash against me.

I similarly have months of supply of hand sanitizer (one big bottle, not hoarding).

The drawbacks of these laws don’t feel hypothetical to me right now.

You don't seem to be responding to my comment. High prices cannot necessarily increase supply when the timeframe is strictly limited. This is a reality that a lot of people seem to not accept. So the effect of price is just to determine the distribution of a limited supply. That significantly reduces the utility of a market pricing system. Directing production is a fundamental reason why markets are useful in normal times, and in the very short term of a crisis, it's not applicable.

That stock in unaffected areas is allocated to the affected crisis area seems like an incredible benefit though. Seems to me that this is an example illustrates the opposite actually. Human demand might be infinite but supply is always limited

Also, high prices sends information to producers that riskily ramping up or shifting production can be worth it. Might not be worth it at a lower price point.

Imagine if, in January before Covid-19 had spread outside China, I brought up all the stocks of N95 masks at US DIY retailers and sold them to hospitals in China.

Heartwarming international solidarity and the power of the market in action? Or capitalists selling the rope that will hang them?

High prices encourage people like me who have more than enough to get off their asses and share the excess.

There is already plenty of TP in existence in the country for everyone, it’s just poorly distributed because the gov has removed the incentive for the TP-haves to distribute it better towards the TP-have-nots.

Or, more to the point of the article, there is no incentive for someone with a useless side project to give up their Azure instance to someone delivering food or medicine.

But it was the high price of the stuff that made the people who require "incentives" grab it. It's circular, like a stock market bubble. First people panic and buy, then other people buy because the price is going up, it's absurd to say that price represents some fundamental truth.

When I went to the grocery store a week ago, there were a lot of things, just not toilet paper. If the laws against price gouging are causing a problem, why is it so selective?

Microsoft seems to be doing the same, sensible, thing that grocery stores are doing in some cases - try to ration stuff per customer.

People are talking about how this dynamic is playing out on a bigger scale, as states compete for resources in the absence of the federal government coordinating.

> High prices encourage people like me who have more than enough to get off their asses and share the excess.

> the gov has removed the incentive for the TP-haves to distribute it better towards the TP-have-nots.


> I have an entire Costco package of toilet paper that will last me months while some poor bastard near me is probably wiping his ass with his hand (or worse...

This is not a reason to you? Some people might not appreciate the tone of this but, you’re seriously lacking morals if it’s not.

I forgot, on HN you’re supposed to be an emotionless robot (like half these people are in real life), talking about morals is illegal.

Wouldn't you be within the law if you simply sold the rolls at your own cost, or even your cost plus 10%, rather than trying to turn a large profit from them?

You could give them to your friend(s) if you have any.

Or try freecycle.

It's not difficult once you realize that if you actually care about waste, then you don't have to profit.

This is absolutely true, of course. I should probably have added "or you can just, you know, give somebody a roll or two of toilet paper." :)

I plan to risk technically violating the "shelter at home" guidelines to bring a 6-ounce bottle of hand sanitizer to a friend in a different city next weekend, assuming my order actually arrives. (It's a little crazy that the stuff is virtually currency at this point.)

I might be within the law (although in some places like BC all reselling is straight up illegal) but some busybody would still call the cops on me and online listings would be taken down by the likes of amazon or ebay.

As long as you have soap, you can wash your hands afterwards. Not my preferred method, but there's quite some cultures where they do it this way.

So make it $500 a mask and you just cordon off a good for the rich.

Econ 101: Today, masks are $500. Tomorrow, 100 companies in various industries begin to repurpose their factories to produce masks and arbitrage the price down until it isn't profitable anymore. Supply increases; thus, there are more masks than there were before the price increase. Even if you don't like who gets the first mask, you can't deny that supply increases, and therefore more people now have masks.

And in the next lecture, you learn that factories can't be retooled overnight, and people die in the meantime.

Masks are not complex. It does not need to be an N95 certified mask to significantly reduce respirated droplets. You would be surprised by the ingenuity of entrepreneurs, but of course, this thread is not about logic but instead about jealousy of others' abilities to profit in a way that some people think is unethical, despite the fact that it would undeniably result in more masks to combat this crisis. In reality, most of the people with your viewpoint cannot envision themselves scrapping together something and pivoting their entire business on such a short time frame, and they share the relatively common personality trait in which they then don't want others to succeed where they do not.

> factories can't be retooled overnight, and people die in the meantime.

Of course the masks aren't hitting shelves the next day, perhaps two weeks before meaningful production increases. What a pointless statement -- the crisis won't be over in two weeks, and this same principle would have held two weeks ago, or eight. And then you would blame people dying on the entrepreneurs retooling to create masks? Another pointless statement if that is not your intent.

> this thread is not about logic but instead about jealousy of others' abilities to profit in a way that some people think is unethical, despite the fact that it would undeniably result in more masks to combat this crisis. In reality, most of the people with your viewpoint cannot envision themselves scrapping together something and pivoting their entire business on such a short time frame, and they share the relatively common personality trait in which they then don't want others to succeed where they do not.

Were you trying to see how many HN rules you could violate in a single post?

This is a marathon, not a sprint. A normal retooling for an auto manufacturer appears to take 8-10 weeks.

They should be in time to save a lot of lives.

They aren't raising prices; they're limiting availability. All three quoted laws solely cover prices.

Yes; the laws are being quoted to explain why they are limiting availability instead of raising prices.

This thread is discussing the hypothetical legality if they did raise prices.

Apparently Team usage is up significantly. You can do video conferencing via Team which is one aspect that is quite different from Slack. I imagine there are some new use cases arising from that.

We had started tentatively using teams before all this. Now it's a critical part of our day-to-day functioning and you know what? It's not bad, not bad at all. It's pretty well thought out, reliable, integrated with Outlook and Sharepoint.

Even the few people who complained that they wouldn't use it because there wasn't a phone number to call for telecons were overcome when we told them to just install the app and join the conference that way.

For internal work, it's actually been a lifesaver. Webex and other solutions have failed to hold up under the strain while Teams has more or less just kept marching on.

I have a feeling as this goes on for the next few months Teams users will not go back to the fractured fragile mess of other apps we tried to get along with before hand.

Hell, there's even a halfway decent Kanban built in.

I still absolutely loathe teams. There is no way to get it to show you have unread messages (the red dot of slack). Notifications do not work reliably. When I am in a Teams channel I miss notifications from the Chat channels, and vice versa.

For me Teams has been a major downgrade from Slack

You totally get a dot (or a @) in either teams or chat to tell you have something unread.

Unread teams groups are bold and same with chats that have new messages.

Calls likewise get a dot and so on.

My biggest gripe is people keep creating new "posts" thinking they're simply typing in to a normal chat window. The posts are replies to other posts, but then when you go back to that screen (team?) they're in a completely random order.

They should add a speed bump to post a new topic in a team, like the new chat button in the chats.

The best was IRC and mumble. It's been downhill since then.

I like IRC and use it. I have zero understanding why anyone on HN thinks IRC is a viable chat option outside uber-nerds.

Show me a training plan (outline is fine), case study or blog or anything outlining how to train my 50 non-technical coworkers in the use of IRC. They need image support and audio chat and all the other modern chat features users demand. Keep in mind there are a lot of chat options and users will walk if what you want to use is rejected by them.

IRC is not and has not been a even remotely viable option for anyone but nerds and hobbyists for many years now. i would be very happy to see any evidence to the contrary.

I mean, Discord is basically re-skinned IRC, and tons of "normal" people who have never heard of IRC use it every day.

I get a count of the messages I missed in a channel and when I’m called out I see an @

I get all the activity I should be alerted to in my alerts button too so document conversation, hidden teams, etc all show up there too.

At my current client we use teams for meetings/conf calls. All chat communication is still slack.

That doesn’t even make sense

Same experience here, my company was unable to choose a collaborative software, but in just one day 250 people had to work remotly while none before.

Teams is somewhat good, good tools to create wikis and integrate third party solution like Jira and office integration. One selling point to me is that "it just works" even with non technical users.

I work for a university, and the official word is to use Teams for everything, including classes transferred online, as the internal infra is not at all able to take the load.

Teams has video conferencing, but also hooks into SharePoint for shared documents.

We now use Teams at work for video conferencing all the time. Before the emergency we hardly ever did.

Different in what way? Slack has built-in video conferencing?

Slack’s video conferencing sucks.

They bought ScreenHero and tried to integrate it. They screwed it up so bad that the ScreenHero founder quit after 4 years and has gone and rewrote it and called it Screen: https://news.ycombinator.com/item?id=22676040

Yeah Slack themselves use Zoom. Slack is a channel based messaging tool, it integrates with best of class video tools like Zoom and file storage tools like Box or even SharePoint.

Teams does it all OKish, although the channel based messaging is probably the worst part.

It's sort of wrong to look at Teams as a Slack replacement. Well, it is for who just want chat, and don't care about channel messaging.

Integration seems like the ideal path for Slack. Make it easy and seamless to use any third party service from Slack rather than trying to build functionality directly into it other than the core group/direct chat stuff.

> Integration seems like the ideal path for Slack.

It's pretty easy for Teams too.

I don't particularly like Teams, nor do I like Slack, but there is nothing feature-wise, today, that would make me choose Slack over Teams. Teams also plays much better with OneDrive and Outlook, obviously.

I think Slack is now a goner. They will be acquired in 5 years tops.

Perhaps they can be the Google chat product that survives?

RIP slack, you tried, but 0 chance against MS/win/office monopoly.

How is video conferencing not a core chat thing?

When I raise a meeting in Outlook, I get a Teams videoconf button and attendance etc will all be managed via Exchange on-line. I can record the meeting and have it shared in the channel as part of the process. There are beta features that transcribe the audio to text, as well.

We recently dropped slack and moved to teams when we started working from home. It seems to be mostly better than slack.

I don't think 1) locking in customers via proprietary APIs 2) limiting supply of resources 3) auctioning off to the highest bidder among your locked in customers was entirely the core feature of clouds. Rather, the idea was "we'll charge so much margin you never need to worry about anything physical, another machine is just an API call away". You don't need to overprovision for peak times and there is less physical stuff on your balance sheet, ez cash flow, win win!

Of course now everyone realizes it's a big sham and neither Amazon nor Microsoft are stupid enough to spend a trillion capex on building the datacenters, fiber lines and so on you need to handle a temporary 700% pandemic situation. In a year from now, they don't want that stuff on their quarterly report just as companies going "cloud only" don't want it.

To be fair, a situation where every single company in the world needed to ramp up on the cloud at the same time is completely unprecedented, and spending the money to do it would've been considered a fools' errand.

If people weren't on the cloud, you'd see them scrambling for physical hardware, which also isn't exactly easy to come by on extremely short notice when the world's logistic chains are under stress as well.

I think given the growth these cloud providers are having every year, expanding to meet the needs of a temporary increase in demand looks more like moving forward projects that were already planned. It’s not like they are going to have to build a bunch of datacenters they will never need again.

The article probably overstates actual increase in demand, picking some small subunit which has experienced outsized increased use. They may well want to continue expanding their core hardware capacity at 20%+ annually.

Possibly Teams video chat which seems to work better more consistently than Zoom or Cisco Webex for small groups. At least in my organization, we've seen a lot of folks move to it in the last two-three weeks.

We now use Teams video chat at work. The results have been mixed. When the number of meeting participants is low (<5) the video seems to work well. Anything above that we start seeing random disconnects. We've had better experiences with Zoom for larger meetings (~25).

At my company we were using Teams' "common" conferences with 230 (1st week) and 250 (2nd week) participants without issues. In this case 248 were listening and 1-2 were talking/videocasting.

Due to there being a 250 participant limit we now switched to live events, and there also has been no issue with that.

I just had a whole company meetup with 100+ people and Teams handled it like a champ.

>does Disney+ run on Azure?

Some cursory web searching suggests that at least as of 2017, BAMTECH / Disney were using AWS as their public cloud provider. There's enough inertia here that you'd imagine that this is still the case.

From here in Australia, developer tools tells me the video is coming from vod-akc-oc-east-1.media.dssott.com which appears to be an Akamai thing.

Akamai is just a CDN so it's cloud agnostic.

Yeah, but most of the demand base load is going to be carried by the CDN... that is the whole point of a CDN.

Disney+ runs on AWS

Can confirm (or back up sels statement).

Price hiking is the least good option of all the possible prioritization rules I can imagine. Regardless of what we need most in a crisis, let's just dole it out to who has money? Really?

I would think that additional capacity can be built out to accommodate demand at a rate that still stays profitable after the usage spike. Not that they’re immediately building new data centers, but adding capacity to existing.

Just if Microsoft moved internal usage to underused data centers somewhere on earth they could create more capacity for NA, EU, Asia.

One of the upsides of cloud is that it’s so much easier to meet demand, even as a provider.

I don’t have access to component prices, but I guess they are buying like crazy (aws and gcp too I guess).

Adding capacity how? PC supply chains are drained - they were impacted by the COVID shutdowns in China a few months ago, and extra demands are in place now:


While I have no inside information, I have to imagine that these same shortages have affected data center hardware too, and that it's much more difficult/expensive to add capacity at the moment compared to, say, last December.

> I'm fascinated by the concept of prioritization rules in place rather than simply raising prices

Do you realise that it's potentially illegal to increase prices based on market demand during a crisis?

Right. It's important to the public that scarce goods instead by allocated by willingness to stand in line. What does standing in line mean for a corporation that could be anywhere in the world? Maybe some kind of proof-of-work scheme for the CEO or majority owner?

Azure could service VM creation requests in the order of their creation, but "take a number" doesn't work as well. The opportunity cost of what else you could be doing with the time spent waiting in line is the "price" that allows the market to clear.

> It's important to the public that scarce goods instead by allocated by willingness to stand in line.

It's important to keep in mind that a higher price is unlikely to lead to much additional capacity due to the nature of this shock. Companies have to do business with their customers for many years after this is over. "Sorry, we're overloaded with demand due to this crisis" sounds a lot better than "Pay us ten times as much during the crisis or go f* yourself." Microsoft isn't in business to allocate resources according to a simplistic strategy pulled from an intro econ course, they're in business to make money over a period of many years.

"Sorry, we're overloaded with demand due to this crisis" is "go f* yourself."

Although you're right, Microsoft may have correctly assessed that its customer relationships will turn out better if it leaves them completely hosed vs. hosed with an unpleasant escape hatch.

It's still an interesting question: what kinds of allocation systems are best when for whatever reason market pricing is off the table? There are certainly better and worse approaches within the space of lotteries, queues, etc.

Some products or services, every customer needs about the same amount, or the same minimum amount. It seems reasonable to have a maximum allocation in a crisis for those.

If different people need vastly different amounts of something, either they are able to judge, in which case prices work, or they are not, in which case some independent means of allocation has to be used.

I don't think waiting in line is a good method, but that doesn't mean unregulated prices always are either.

This shock is going to be a lot less short-term than people in this thread advocating anti-price-gouging laws seem to think.

Your tone seems to be that it's either allocate by price or by standing in line.

But it's analogous to toilet paper. If you are limited to one package per trip through the checkout line, yes, you can consider that to be allocating by willingness to stand in line. But the intent is simply to have a (not terribly strict) quota, and not to have you go through many times.

So it isn't as fundamentally screwed up as proof-of-work. Nobody is supposed to actually treat it that way.

Proof of work isn't necessary. Rationing works too.

So what do you suggest here ? Prioritize a wealthy workspace sharing startup over a hospital?

If this is a temporary spike, raising prices might drive out customers which cannot afford the price hike but would have stayed customers for a long time, while retaining ones that will happily pay now, but go away in a couple of months.

> I'm fascinated by the concept of prioritization rules in place rather than simply raising prices.

Given the sudden need and the circumstances behind it putting prices up might not decrease demand enough to make any difference so while the system will be more profitable it won't be any less congested and now you have people paying more but feeling like they are getting less because they had to wait an hour before they could start that little herd of VMs they usually have available immediately on demand.

This could drive people off onto other services, or at least make previously entrenched users look up and scan the horizon.

AWS spot prices are rising last 3 weeks.

I looked at a few of the instances (20 or so) and did not see any substantial increase over the past 4 weeks. Which instances are you seeing spiking up?

Is there a graph somewhere that shows by how much?

I suspect the situation is that most customers have already paid for the service, and would demand a refund if they can't reasonably use the service.

In general, not necessarily with Microsoft, the problem is that once people get their money back, then the vendor can't pay its bills and you have a potential for the whole economy to go into a seizure if enough people are like "oh, free market, sanctity of contracts" etc.

This is happening in real time: https://www.cnbc.com/2020/03/29/coronavirus-mall-owner-taubm...

Could extend this to large companies with multi-year cloud computing contracts with Azure

It looks like they failed miserably on capacity planning. I thought that those three major clouds are that ridiculously expensive (egress cost, huh?!) just because of guarantees of the capacity and service availability but that seems to be wrong at least for Azure.

Don’t forget Xbox Live on Azure, it has had a pair of outages in the last few weeks as well.

Latency in multiplayer games (at least Halo:CE prints well-known Azure region names during game load) has been noticeably worse in the past few weeks, IME. Even during off-peak hours.

As Microsoft noted in their blog post, XBox Live also runs on Azure.

Healthcare and first responders shouldn’t have to pay more to get the server resources they need to respond to Covid 19

I wonder what the net neutrality people think?

Net neutrality is about the network itself, the internet, not cloud computing.

I thought net neutrality is “all bits are created equal.”

Service providers shouldn’t discriminate between one bit and another - no deals that prefer some providers or traffic over others.

It usually refers to ISPs, but I don’t see why it doesn’t apply to cloud providers too.

Cloud provider is not a grocery store? You can't just wake up and randomly raise prices of services.

Also lots of .gov runs on azure.

The Microsoft blog post that the article is using as a source: https://azure.microsoft.com/en-us/blog/update-2-on-microsoft....

After reading this, it seems the headline is a bit misleading.

The Microsoft blog post states: "We have seen a 775 percent increase of our cloud services in regions that have enforced social distancing or shelter in place orders."

So it's not an overall increase, just in certain regions?

Ok, we've taken the 775% out of the title above. It sort of breaks the site guidelines about magic numbers (and linkbait) anyway.


Yes, and they also say that if you're hitting quotas, you can try another less congested region. If you have established workloads in a region though, I'm not sure how quickly you can migrate a complex interplay of services to another region-- are there simple tools to do so in Azure?

hopefully you are writing infrastructure as code - would be easy then.

I doubt they’re talking about their compute services. The increases are more likely in Microsoft teams and Office 365. And as far as I know you can’t choose a region for those services.

For toy projects, sure.

A lot of the value of hyperscaler clouds is the lowish latency local datacenters.

Also, everywhere's going to have enforced S.D. or S.I.P. sooner or later.

Those ‘certain regions’ would be most of the world, though, presumably.

Why would Microsoft be disproportionately affected by this? Are we expecting similar decrees from AWS and GCP? Or was Microsoft operating with less runway before this began?

Working with all three of them, so here's my two cents: 1. Mostly traditional, "legacy" companies have been hit hard by this. Ones that don't have culture or technology of work-from-home. Those companies use some Microsoft products. Also, Microsoft has been poaching them heavily, handing out trials, bundling licenses and so on. A lot of them don't actually buy stuff from Microsoft, but through 3rd party vendors which have incentives of their own. Some of the end users don't actually want to use AWS, also.

2. I actually think Microsoft has much less runway. From what I understand, AWS has more modern infrastructure and backend, and they shuffle resources easily around, between services, and I think they have much more in reserve. Microsoft has concentrated much more on the sheer number of regions.

3. Azure has a strange way of handling quotas, if you ask me. Up until now, once you provision a VM, it is deducted from a quota and stays like that as long as it exists. It has never been an issue to actually power it on (unlike AWS), once you have it. It's not billed, but we always thought it stays like that. Since last week, you can see failures not only when provisioning VM's (even within your quota) but also when starting them. Nevertheless, I also think a lot of users had larger quotas allocated then they actually use. So they just started creating more VMs or other resources (because they could), and the thing came crashing. I think that's just poor planning on Microsoft's side.

But the thing I'm mostly pissed of is the status page. VM's are failing left, right and center and everything is nice and green on the status page. Once you open a ticket, they send you an incident-in-progress report.

> But the thing I'm mostly pissed of is the status page. VM's are failing left, right and center and everything is nice and green on the status page. Once you open a ticket, they send you an incident-in-progress report.

Status pages parroting lies in service of marketing should incur more liability for companies than they do. How does a society discourage vendors from doing things like this?

It should eventually fall under consumer protection laws. Failing to report incidents on a status page is like failing to mention trans fat on a package label.

It’s more like actively claiming “contains zero trans fats!” On the packaging when in fact the product is full of them.

Which they do. Your tortillas with partially hydrogenated vegetable oil? Yeah, it's less than 0.5g per serving so they get to say 0g.

>Your tortillas with partially hydrogenated vegetable oil? Yeah, it's less than 0.5g per serving so they get to say 0g.

Personal favorite: Tic Tacs are 94.5% sugar yet Tic Tacs can be marketed as a "sugar free" food.

"The Nutrition Facts for Tic Tac® mints state that there are 0 grams of sugar per serving. Does this mean that they are sugar free?

Tic Tac® mints do contain sugar as listed in the ingredient statement. However, since the amount of sugar per serving (1 mint) is less than 0.5 grams, FDA labeling requirements permit the Nutrition Facts to state that there are 0 grams of sugar per serving."


At the moment it's reputational enforcement: if enough people badmouth them on Hacker News, the money will flow to competitors. (There are other ways to enforce norms, but they have their own problems.)

Mostly traditional, "legacy" companies have been hit hard by this

Yes, this. Where I work, WFH had an outright ban until this all hit the fan. Now, anyone who can do so has a mandate to WFH. We use Citrix to access some internal resources, though it's really inefficient: If you want to access a file on network drive, say an excel file, you need to use Citrix to launch an Excel instance, open the file, and deal with it there. You can't easily get it to your local computer, so this adds to the overhead necessary to use the system, which has been strained of late (and it's not like citrix lacks the ability to transfer files between remote & local, they've just disable mapping of local drives during a session) Luckily I have a server-class workstation under my desk at work for heavy data-crunching, and setup my own VPN, which works much better. At least unless/until they turn power off in building not being used.

I think Azure also has more regions than AWS, but yet a smaller overall capacity probably, so it's gotta be harder to keep space capacity. It's notable the shortages are isolated to specific regions. They were possibly small to start and so it probably didn't take as much to hit capacity there? Just a guess.

That's my hunch also... Speaking for someone interested in IaaS/VDI, not all instances are available in all regions. For example, instances with GPUs are available only in North and West Europe. If you need them, and they are out of stock, you have no value of any UK or France region.

> But the thing I'm mostly pissed of is the status page. VM's are failing left, right and center and everything is nice and green on the status page.

There are three kinds of lies... lies, damned lies, and cloud service status pages.

Are your VMs failing on deployment or after they are deployed?

If it’s after deployment that would be concerning

Mostly on deployment (after the process has actually started), but sometimes after (on start).

Since we use Azure a lot through the API, there is a difference in the first case. Usually it would fail on the first API call, it would just tell you this or that went wrong. Now the process fails after it has been started.

Office 365 runs on Azure in the same regions other workloads do (There's probably some replication going on behind the scenes too, since you don't pick your instance), so I'd bet that tons of new Office 365 subscriptions in the past month are what is causing this, not people deciding to lift-and-shift their app workloads because of the virus. Teams adoption has probably shot way up too.

My theory is that Amazon and Google are more prepared to handle surges because they run some of the largest web properties.

This like every day is Black Friday for Amazon. It's rough, but not something they have never dealt with before.

GCP and GSuite had outages this week listed on their status pages.

AWS has been rock solid for us in the 3 regions we operate in.

The GCP outages don't seem to have been capacity related though, they were both networking issues. In one of them they broke their traffic routing to a datacenter in Atlanta, and in the other one an unnamed cloud provider (that pretty much has to be AWS) broke inbound inter-cloud traffic in us-east1 (so presumably AWS borked the link from Google's us-east1 to AWS us-east-1). These seem like normal sorts of cloud issues that happen to coincide with covid-19.

If anybody at AWS is reading this: congratulations! Thank you! Keeping infrastructure running is hard in the best of times, and these times definitely are not the best.

We've anecdotally seen a huge increase in spot market flakiness, but basic functionality and reserved instances have been solid.

"This like every day is Black Friday for Amazon."

So, a pretty big deal then: https://www.theverge.com/2018/7/16/17577654/amazon-prime-day...

I imagine companies are flocking to Microsoft's virtual desktop solutions more than AWS or Google. It is the most well-known provider among managers who need to make a snap decision right now on how to have people work from home, if I had to guess.

"Rampant" work from home with Office 365 I guess. I guess most of the load is all these Team video calls and VPN services?

Yeah as a member of Azure networking, it's odd: HR is communicating we should do video calls for meetings instead of just audio, to keep the personal touch, and I'm wondering if that's really the best use of our bandwidth. I keep my video off anyway.

Imagine thousand and thousand video calls with multiple receivers for each transmitter ... over VPN.

I don't use video since I feel weird doing it. Also I don't want to do my hair and change from pyjamas.

Compromise is to turn on video only when talking. Also works as #raisehand ..

A huge portion of this has got to be MS's own services, e.g. tons of people who normally use Office and are at work are now use Office 365 online and doing a ton more videoconferencing with Teams.

All Office 365 company customers were also dormant Teams customers. There's a lot of these companies and some non-trivial portion of those have now become active Teams users. That probably drives a big portion of the increased conference traffic at least.

A significant percent of Microsoft’s ‘cloud’ division is office and sharepoint and the like. I’m sure thatusage is through the roof right now.

Sharepoint Online runs on separate infrastructure from Azure in their own data centers.

A lot of companies and educational institutions already had Teams licenses through their Office 365 contracts, but weren't really using Teams. Now they're using it, a lot, because "it's already paid for". Simple as that.

Because a lot of people have their Office 365 subscription and maybe just use email. All of a sudden they realized they are paying for all this other stuff they aren't using so they're leveraging it now that they need it.

>>Why would Microsoft be disproportionately affected by this?

Nobody gets fired for buying Microsoft..er IBM. Inertia too.

If you're shopping for cloud providers, nobody gets fired for picking AWS. Microsoft is if you're looking for email, spreadsheets, and desktop publishing.

Unless you're a vendor for Walmart.

How much excess capacity would a cloud provider typically have (as in %) to accommodate normal peak loads and still have a comfortable margin?

Or maybe that's not something providers reveal, so let me as the sys-admins of this thread: For on-premise resources, what is your % margin of excess capacity reserved?

For specific ec2 instance types the excess capacity is sometimes zero, which customers sometimes see. I've needed to swap instant types to get a deploy unstuck or to scale up in the past when capacity didn't exist.

Because of that I always recommend that a project reserve instances to ensure capacity exists when you need it. It's also cheaper, but that risk is important to mitigate.

"How much excess capacity would a cloud provider typically have (as in %) to accommodate normal peak loads and still have a comfortable margin?"

We (rsync.net) run a sort-of just-in-time deployment model wherein as our storage arrays approach 80% capacity, we completely remove-and-replace the oldest storage array at a location[1].

The 80% number is related to performance penalties that become extant when you fill up zpools too full. In the old days, that is the threshold beyond which we would see significant performance degradation. ZFS behaves better now and you can avoid a fair amount of that degradation by having read and write cache devices (L2ARC and SLOG) but we still hang onto that 80% number ...

When we do such a replacement, we are often replacing a 2-3 year old storage array with a brand new one, which means that the drive capacity of the refreshed system is about double what it was before - so we have a relative glut of space for a time. This allows us to onboard larger (50-100 TB) clients with no lead-time.

FWIW, we have seen a relative increase in signups since lockdowns began. My current theory is that a lot of people are sitting at home with a lot of free time and thinking about risks ... and some of them think about backups.

[1] Denver, San Diego, Fremont, Zurich, and Hong Kong.

It would be interesting to know how many standard deviations is 775% extra demand from the norm. More than six standard deviations is rarer than a 1 in 506797346 event.

Samples getting 6 standard deviations away from the mean can happen 1/6² ≈ 2.7% of the time. You might be assuming properties of the distribution that aren't true.


Isn't that an upper bound? It says that it happens at most 2.7% of the time

Yea, it's an upper bound. The actual percentage depends on the distribution and can be anywhere from 0-2.7%. The Wikipedia link has more details.

The difficult question is how quickly can capacity be increased and given uncertainty about how long this demand increase will last, does it make financial sense to do so?

I wonder if this is because a lot of companies suddenly have to make a change they didn't feel necessary in the past and now rush to compensate for a lack of planning.

While it technically doesn't matter where you run, there are a lot of choices that have a different answer depending on if you ask your vendor or if you do your own checks and research.

Scaling purely because you needed to scale up would be a different story, and then you're expect overall service demands to go up that steep. This seems more like an unpreparedness peak to me.

Office365 and AzureAD has been even more unreliable than usual over the past week or so, plenty of "an error has occurred" pages and delayed mail - as usually Microsoft didn't update the status dashboards (the ones you can see without being able to log in anyway), The other client I work with uses GCP and Google Mail/Docs for business which I haven't noticed any issues with.

GSuite and GCP had impactful outages for us this past week and were listed on the status dashboards.

We might have been lucky with the region and timezone we're in - australia-southeast1

Looks like you are repeating the same comment everywhere without linking at what kind of outages GCP had.

Disc: Googler

It made the front page, so most readers here are already at least passingly aware of it.

Sorry I should have been more clear in my comment. I meant to emphasize that the outages were not related to COVID-19. So there is no point of repeating the same thing everywhere as it is not relevant.

Yup, that was my point but I failed to clarify in the first comment.

So that's why my OneDrive sync hasn't been working at all.

There is no cloud, only other people computers. (c) FSFE

video conferencing is way up online food ordering is way up buying stuff online in general is up i imagine all video streaming and gaming is up

I read and executed but did not write that percentage

Time to buy MS stock.

Amazon ,surely? They’re presumably seeing similar demand boosts, but seem to be struggling less with it.

I'm not so sure they'll be seeing the same demand boosts - I don't think they have the same masses of remote desktop and Office 365 sort of use cases. I'm sure services built on AWS are seeing big increases, but I think Microsoft's situation is probably unique.

Setting the "priced in" bit aside, someone in mentioned their unusual (at least for cloud billing) quota system. If customers are unable to provision new VMs, they could end up offering discounts for essentially missing their SLA. It also depends on how much spare capacity they have to sell.

Why was this downvoted? It was meant as a positive remark. Not trying to troll. I think it’s healthy for AWS with some competition.

priced in

No it's not.. The market is not sane atm. It's 100% emotion.

What makes you think that? Have you seen a discrepancy between your projections of future cash flows and therefore your valuation, as compared to the value the market is at right now?

I think it's safe to say the market isn't rational when Zoom Technologies is up nearly 900% when it's completely unrelated to Zoom Video and not actually operating.

There's a different HN post about it: https://www.nasdaq.com/articles/the-sec-really-wants-investo...

I don't think you can really compare people accidentally buying the wrong ticker to investors unable to place valuations based on virus uncertainties. They were buying the wrong stock before the virus hit more than a year ago.

The wrong stock increased faster than the real stock. Volume matters too but when the underlying causes are irrational, how can any pricing be logical over any period longer than a few days?

They’re mainly a software / services company. There’s no reason their revenue will drop, the contrary..

Yet the stock price has the exact same changes as the rest of the entire market.

Their cloud demand is up x7.. it’s not priced in. Amazon same thing, although less so imho

Their current p/e is 26. Remove cash and it’s nearing 20.

5-10% swings are definitely not sane. I think there was technically a 3-day bull market last week, even though there wasn't much news that wasn't foreseeable on Monday.

I read that a lot of hedge funds running heavily leveraged, marginally profitable strategies have been deleveraging. That's a pretty rational response. Some of the movement is emotional, but some is driven by more rational concerns.

Microsoft stock is up more than 4% today after this news. It's almost foolish to claim anything is priced in because the stock market is a Keynesian contest. Claiming it's priced in means you know how every other portfolio and hedge fund manager is going to react to news. Some might be slow to react, some might overreact, etc. Nobody can read minds. Thus it's almost impossible to claim anything is priced in.

I don’t know about that. Long MSFT short AAPL perhaps. But if we believe that the lockdowns will last 2 months+, and if we believe the economic forecasts, we are facing a crisis worse than 2008. Even good stocks sink in those markets. The 30% drop we have seen so far barely reversed Trump’s rally. I don’t know that a severe recession is priced in yet.

2 months? Try 2 years. It's a year minimum before we get a handle on this (no, not the vaccine, just the virus itself).

That's ludicrous. If you were right we wouldn't have a stock market by then. We wouldn't even have an economy after 1 year of lock downs, even if they were on and off. There's a point where we just won't be able to isolate and if the virus stays dangerous we will be forced to just take the risk.

"I do not think that this argument is sufficiently substantial to require refutation. Consolation would be more appropriate."


Or, we change the kind of economy that we have. We're seeing right now how what parts are actually "essential"; arguably, the rest is only necessary for growth. If growth stops being the goal, the the economy as it was doesn't have to continue.

We're already seeing some rumblings of a stark dichotomy, what with some people advocating for a return to work and acceptance of the risk, contrasting with the backlash that their dollar is not more important than someone's life.

In a Japanese subway, someone wrote: “We can't return to normal, because the normal that we had was precisely the problem.”

It doesn't entirely matter if they're right or wrong objectively; if enough people subscribe to this view, it becomes what we live through.

That was Hong Kong, not Japan

Sorry, but the economy doesn't just go poof and disappear, I don't know what theory of economics you ascribe to but that's just nonsense. Everything is a trade-off and we'll find ways over time to ease the effects of the lock downs (more masks, more remote work in fields previously thought unviable to remote work in, gradual exceptions made for certain industries critical to public well-being).

I encourage you to play with the epidemic calculator. This isn't something you "just" take the risk for. And keep in mind that the deaths in the calculator aren't including deaths due to denied hospital beds for more typical things like heart attacks and strokes.

Is 10-30 million deaths in the US this year an acceptable trade-off to keep the all-so-important economy going? Or can we scale back the economy and distribute the wealth so that only food can be afforded while we build up hospital resources, work on a vaccine and save lives?

The same kind of thinking sent the stock market shooting up when some 3 million people filed for unemployment claims last week.

"Phew! Now that its priced in, let us focus on putting our $2 trillion to work"

Honest question; how do you define "demand"?

Maybe start by clicking the link?

> In a March 28 blog post, officials said that demand for its new Windows Virtual Desktop usage has grown by more than three times. They also said government use of public Power BI for sharing COVID-19 dashboads is up 42 percent in a week. (As is the case with Microsoft's overall cloud services figure, we don't have a base number for WVD and Power BI from which to calculate these percentages.)

It still doesnt define demand. Is that new sales or what?


Their utilization has gone up 700%? Bullshit.

>"We have seen a 775 percent increase of our cloud services in regions that have enforced social distancing or shelter in place orders."

Seems to be a cherry picked statistic, not an overall increase in utilization.

Uh, it's absolutely true. I have entire offices (100s of people) that switched from Webex to MS Teams for better video quality.

Not for Azure as a whole, no, but that sounds entirely plausible for specific services like Teams.

Good time to remind that 'the cloud is just some else computer' ...

The cloud is someone else's collection of computers operating at a very large scale. If my load changes in a way uncorrelated with other users', that's a very good thing. If my load is correlated with other users', that's may be bad. But it could still be good, because at that scale, they can justify having robust contingency plans -- back-up supply contracts, extra engineers around to ramp stuff up, or relatively unimportant stuff they can de-prioritize. (If you're relatively unimportant, that's a bummer; if you're a hospital getting priority, that's a plus.)

While true: only few individual companies would have enough computing power to handle their suddenly increasing load ready ... or capability to setup the services now in demand

And 77.5% of the new demand turns out is from the Microsoft employees sent home :)

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