Agreed 100 percent. Software is the easy part. Getting HVAC, power and network up to the levels of cloud providers is difficult to get right and prohibitively expensive.
For instance, the cost for a pair of redundant symmetric gigabit fiber is in the thousands a month and may require tens of thousands of construction costs.
These quickly add up, and the upfront costs can quickly reach six figures.
Not to mention security compliance. If you can afford all of that, seems pretty likely you'll also have SOC2/etc needs. Being able to "ignore" the whole physical security aspect of that stuff is a huge benefit of the cloud.
There’s a huge middle ground between on-prem and GCP/AWS. You can rent space and connectivity from in very competent datacenter without any of these big fixed costs.
Can rent the space, but you still have to buy the hardware. Maybe there's money to be made running some low-availability cloud service offering newer hardware.
Have you checked the price for a system capable of using two redundant 10Gbps links lately? It’s cheap. You could put gear like this in your closet at home and not feel particularly silly about it, especially if you are willing to buy still-current used enterprise gear.
For that matter, have you checked the price, in qty 1, of a server that will absolutely destroy anything reasonable from a major cloud vendor in terms of IOPS to stick behind that switch or router? Even if you believe the numbers on the website of a major server vendor and forget to ask for a discount, it’s still quite reasonable in comparison to a major cloud.
Yeah, tends to be. But it's more efficient for multiple customers who don't need the hardware full-time to share it. Someone could set that up without all the expensive HA guarantees and other stuff a regular cloud provides. Maybe was too niche in the past, but now with the AI boom...
I remember seeing a quote for 500/500 metro E from Comcast several years ago. $12k to install, $1.2k/mo. And that only involved laying a few miles of fiber, no redundancy. Dedicated lines are no joke. If you're AWS or GCP, you can be your own ISP and mitigate this to some extent, but that's just the physical connection they save on.
You can always save by going on-prem, assuming you have no uptime requirements. But the moment you sign an SLA, those savings go out the window.
For instance, the cost for a pair of redundant symmetric gigabit fiber is in the thousands a month and may require tens of thousands of construction costs. These quickly add up, and the upfront costs can quickly reach six figures.