Cloud Economics: The Customer Pays Because Going-Back Costs Are Too High

July 11, 2022

Short- and mid-term decisions may not be the optimal ones. Who cares about that pawn? Maybe in the end game, that pawn was on steroids. The player willing to give it up was unwilling to think about what lurks in the future.

I read “FedEx to Close Data Centers, Retire All Mainframes by 2024, Saving $400m.” The main idea is that mainframes are not suited to the zippy world of today. Furthermore, programmers –despite high-tech’s enthusiastic reduction in force moves – are not into the oddities of big iron. Those who do get jazzed with total-code working environments are rarer than a certain prince’s attending a female 15 year-old’s birthday party at the country club pool in Oxfordshire.

The write up reports:

Speaking during the FedEx investor day, FedEx CIO Rob Carter said the company is aiming for a ‘zero data center, zero mainframe’ environment based in the cloud, which will result in $400 million in savings annually. “We’ve been working across this decade to streamline and simplify our technology and systems,” he said. “We’ve shifted to cloud…we’ve been eliminating monolithic applications one after the other after the other…we’re moving to a zero data center, zero mainframe environment that’s more flexible, secure, and cost-effective.”

One way to view IBM’s approach to computing in the pre-person computer days was a person in handcuffs. IBMers disagree with my view. No problem. I also see cloud computing as a variation of the IBM approach to computing: Lock in and change are business benefits. Leasing mainframes and buying services each year is the equivalent of high-tech’s discovery of subscription-centric revenue models.

FedEx does not see the cloud as a variation on the mainframe strategy and its pricing structure. I thought one of the FedEx wizards was a Harvard MBA wizard.

The write up notes:

FedEx has previously said it planned to work with Intel and Switch to build Edge data centers at FedEx locations across the US. Whether this has actually been rolled out is unclear.

Trendy I suppose. I want to point out that there are some interesting comments about this alleged decision in the Y Combinator Hacker News comments. You can find these at this link.

One comment resonated with me: “Change gives the illusion of progress.”

Stephen E Arnold, July xx, 2022


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