A Casual Take on Cloud vs. Data Centers (An Opinion Reaffirmed by DHH)

Hey there! There's been a lot of buzz lately about whether the cloud is the right option or if data centers are making a comeback. I wanted to share my thoughts on this debate, especially since my opinion has been reaffirmed by DHH in the AI, Employee Equity, and Other Listener Questions podcast episode.

The Buzz Around Moving Back to Data Centers

There's talk about big companies leaving the cloud in favor of their own data centers. One example is Ola, which moved out of Azure. In a previous blog post, I shared a video where DHH from 37signals criticized the high costs of cloud and suggested that running your own data center is a no-brainer. He pointed out not just the economic angle but also how four big companies controlling so much of the Internet creates a kind of monopoly, whereas the Internet should remain democratized.

I do agree with some of what he says, but there's a lot of context we need to consider. Depending on who you are and what your priorities are, the value of the cloud can vary significantly. Don't assume the cloud is inherently bad and just stay away from it. To me, that's nonsense.

Finding the Right Fit

If you look at companies moving out of the cloud, most have already reached a steady state. They've found product-market fit, have stable revenue streams, and understand their traffic patterns and capacity needs. Only these kinds of companies might see their cloud bills as too high because they have the time and energy to focus on cost savings.

When you're still in the growth phase, it's ridiculous to think you can dedicate all your time to the underlying infrastructure. You need to move fast. Cloud services give you ready-made tools and abstractions so you can hit the ground running. Yes, these abstractions can later feel like unnecessary complexity, but in the beginning, they're what let you iterate quickly.

It's Not Black and White

I'm not against running out of a data center. All I'm saying is that it's not a simple either-or choice. It depends on your situation and priorities. Sure, if you're well-established, you might gain a lot by moving off the cloud. But if you're just starting out, the cloud's built-in services are practically essential.

Big companies criticizing the cloud have the resources and the context to manage data center operations. But for most startup founders, having cloud technologies available on day one is extremely important for turning ideas into products and finding those first customers. Doing all that with a data center right away? It's nearly impossible.

Closing Thought

At the end of the day, the choice between cloud and data centers is all about context. Don't buy into blanket statements that the cloud is either the best or the worst. Figure out where you stand, what stage you're at, and what your priorities are. That's all there is to it!