Some initial answers and responses. Longer retort to Smorg later.
HMC:
Does edge compute open up additional market opportunity for ZS? Or, given the direction the first movers are taking by self-developing security features for the edge, will this restrict ZS TAM?
ZS is likely using some kind of compute on their edge servers, but unlike Cloudflare and Fastly, they are not they granting outsiders access to internals. Nothing w/in their edge network is programmable or controllable by customers. You enter a point of their edge, and you get routed to the service you asked for. End of story.
So my answer is NO. I don’t see ZS moving towards Cloudflare and being a programmable edge network - but I obviously DO see Cloudflare moving towards Zscaler (and Fastly eventually too).
With Cloudflare now a direct competitor, certainly that affects the total market share that ZS can get. TAM (total addr market) is not affected as it is TOTAL. I’d also say TAM is probably growing in this environment of everyone having a highly scattered workforce.
How quickly Cloudfront replicated Zscaler’s platform on their own Workers platform is what should scare Zscaler investors. I mean, it was a year or more in the making as the individual products were created, but the fact Cloudflare wrapped them up and bundled it all into a Zscaler clone was pretty damn impressive.
Fastly could easily do the same given their extremely similar architecture, or if not them, a customer could develop the same thing on their edge network as a service.
PS this highlights something I only skirted the surface of… who knows what customers, aka the developers on these edge networks, are going to build from here! But I fully expect Fastly and Cloudflare to start being the “Salesforce” of next-gen networking and cybersecurity focused product lines, just like CRM does for Veeva and Ncino.
Regarding “the edge”: As we have evolved through time to discuss “the internet” and “the cloud” as pseudo-geographical locations in the world of technology; is “the edge” moving in a similar direction?
Absolutely. Cloud providers will try to blend edge networking into the cloud more and more - but as a term and an architecture, it is here to stay as its own thing. Cloud intrastructure vs Edge infrastructure.
RetirementDough:
Is it easy for a developer to switch from Fastly to Cloudflare? Why or why not? Here is my thinking. If Fastly is charging on usage and Cloudflare has one time charge not based on usage, would not everyone who starts off on Fastly just move to Cloudflare eventually once their usage spiked? Is this a concern?
Unknown. I’d guess porting code is probably not that terrible between edge platforms as both support WebAssembly binaries. But the change to the other providers APIs to control the edge network probably is where the difficulty would be. So, that probably nets out to the answer being NO it is not easy. And likely there are different features between the edge network APIs that aren’t 1-to-1. So I would think that these edge networks are going to be extremely sticky, as once a custom application is created and deployed and successful, there is not going to be much impetus to change it.
“One time charge”? Not sure where you got that from. Cloudflare has tiered pricing on Workers (what they now call Workers Bundled), which are capped usage levels that are very restricted in the amount of compute/memory they can employ. The new Workers Unbound is going to be priced like what we assume Fastly’s will be: usage-based and not capped. Once both are in GA we can compare pricing and features better.
WillO:
“Edge compute could be making decisions around how to best maintain latency”…
Is his how Cloudflare got ‘zero nanosecond cold starts’?
That wasn’t what my point was about - I was referring to how the nodes in the edge network could be work together to heal itself, work around issues, etc. This isn’t about how Workers loads in the customer’s app modules.
Cloudflare is cheating a bit on how they greatly reduced cold starts. It seems a gimmick and it’s a bit surprising given the great CEO blog post that I linked where he claims speed is not everything. I think they want the head-to-head stats to look better against FSLY but the way they did it is a band-aid.
And, do you see AYX’s new cloud initiative working well with as you put it, ‘cloud edge network’ capabilities in ‘stitching’ information?
Now that’s an interesting observation. AYX could absolutely be using edge compute to run models in a place more local to the data source. But we need to see exactly what their cloud efforts on server side are even going to look like. It’s interesting to ponder the potential though.
Do you think Cloudflare’s Bottom lime could be demonstrably increased with [consumer-facing apps]?
Yes absolutely. But I don’t believe it will contribute anything near what the enterprise side does.
-muji
long FSLY, NET