Re:On Cultures That Build
by hiptobecubic on Friday June 19, 2020 @10:38AM
(#23574951)
Except that these cloud providers are trying to undercut each other as much as possible all the time, and you really honestly don't have to use them to build your service if you don't want to.
If you want a bunch of super convenient features like elastic compute, you will, but they didn't have those features when they built their flagship products.
Public cloud providers are very much in the customer acquisition phase. There are still a lot of on-prem datacenters out here that they are trying to compete over for business.
Once the entire customer base is locked in more or less, the cartel effect will kick in.
The 30% platform tax is a fantastic example. A giant will always win, or be able to stall a fast-growing company, if they can tax 30% of the revenue and build a competitor without this headwind. Even allowing apps that require people to sign up outside the app, that is a significant growth and conversion hurdle.
Advertising-based apps are untaxed and hence incentivised. However, Google and Facebook have acquired and monopolised the market so that you really can't make good money unless you go through them -- and they get to take a 40% clip. Thus, FAAMG will always grow faster than you because collectively enforce a tax on anyone who might be able to challenge them.
FAAMG is the modern day OPEC, just relying on subtly and game theory instead of outright cartel meetings.