Yes and no. First off, I don't think Netflix can afford to build the kind of infrastructure they're using -- certainly not without changing focus of their engineering resources. They famously do a lot of work to move data closer to the end users globally -- they're not "just" a US company. Essentially, they'd have to have an operation that would be "qualitatively" similar to AWS in order to be able to do what they do (and at a smaller scale overall, I think that would end up being quite expensive).
I'd argue Netflix is one of the few companies I can think of where this "all cloud all the time" idea for infrastructure might actually make sense. I agree it's a big risk though -- and probably not good advice for most companies.
It would also appear that Netflix is planning on actually selling a product (video rental) and make money off that, rather than have that merely as a vehicle to drive other, sometimes tangential, innovation. That remains to be seen, of course.
They do that to themselves so that when it actually happens, they are prepared and the end user (almost) never sees it.
You might get better response times knowing it's a local problem vs let's say an office in NYC hosting your ticketing system. Regardless, I'm sure they have put a lot of thought into this set up and to me sounds amazing. No ties to a physical location = win.
Its a cost benefit analysis issue.
Netflix took a very early stance that they wanted a large portion of IT ops pushed out of the company.
One still needs to provide the means to supporting the actual tools which are required to the core business continuity -- but the industry has matured a great deal in the last ten years to the point where you have multi-billion dollar enterprises where their whole core business is that singular department that Netflix has chosen to push out of their management purview via outsourcing that cost....
This is not a bad business decision - the AWSs DOs etc have commoditized all the portions of that previously in-house IT department in a way which everyone can benefit.
The risk is in the last mile.
The most needed disruption in the tech-world today is in the carriers in their current incarnation. THEY MUST DIE.
I didn't get that he was talking about moving to cloud/SaaS vendors as a whole, but more the IaaS/PaaS space - the "Hey, this app runs RoR, can I just run it from a Heroku dyno rather than a VMWare box in a cage" type of move. Granted, there's still a cost associated with that, and a need to plan the move, but it's less of an issue. They are making heavy use of SAML SSO it appears, so the account/vendor thing probably wouldn't be as much of an issue.
No, it's the business continuity way of thinking. Outsourcing commodities -- such as servers, virtual or otherwise -- is one thing.
Outsourcing your core operational tools, software, and all your data is another matter entirely. Preferring SaaS at a company large enough to afford on-premise solutions is just nonsensical, and I expect it'll either blow up in his face, or just create a never-ending tax on end users who are constantly dealing with a mishmash of vendors, accounts, disappearing services, broken software, and instability.
At scale, stability and continuity is worth more than the opex/capex costs of internal IT.