…For FSLY, all I have to say is that I’ve followed Artur Bergman for many years and what FSLY is intending to achieve with Compute@edge may change the design patterns of how developers program in the near future ( I think I had written a post about how they build their native WebAssembly compiler. Also, we’ve discussed on this board how the best tech many not be the best market winner BUT with FSLY, that might be proven wrong. The best tech is what developers want and FLSY is providing that and this clould be a bottom-up choice for a lot of developers which can influence enterprise business contracts.)
…Before winding up, I want to bring up DDOG. In the past few months, I’ve been interacting with many technologies and tech companies and if there’s one name that is brought up in most discussions is DDOG. So, whether you like the name or not, DDOG is a serious player in the monitoring space ( do look up some details I had written about DDOG on this board a few months back)…
I wrote the above about a month back…
Posting this to let you know that it was a hard decision but I finally sold OKTA and NET in the recent past. It was indeed a little hard to let them go after having written about them a number of times. ( https://discussion.fool.com/net-vs-fsly-which-is-better-34517311…)
This is the first time in my investing career that my portfolio is down to just four names. They are ZM, FSLY, DDOG, CRWD ( in decreasing order of allocation).
I had bought more FSLY and DDOG from the proceeds of NET and OKTA. Both NET and OKTA are great in terms of technology and investments but I see my top 4 doing better. I hold about 5% cash.
Going overdrive doesn’t mean that my positions and allocation sizes won’t change. That’s what it is for now. Also will be keeping a close eye on SNOW.
Posting this to let you know that it was a hard decision but I finally sold OKTA and NET in the recent past. It was indeed a little hard to let them go after having written about them a number of times. ( https://discussion.fool.com/net-vs-fsly-which-is-better-34517311… )
I never had much interest in CDNs. What got me interested in Fastly was IoT edge computing. Surely the population of IoT devices will vastly exceed the human population for whose benefit Content Delivery Networks (CDN) were created. Fastly’s redesign of the CDN architecture was an added benefit. Traditional CDN is simply out of date. Fastly went back to first principles to redesign the architecture with 20-20 vision that the original CDN creators did not have.
For me Fastly is reminiscent of other disruptors like Netflix/Blockbuster, iPhone/Blackberry, ARM/Intel, Dell/IBM, EV/ICE. It’s truly hard for incumbents to reinvent themselves, to disrupt themselves before an upstart does it. One of the prime examples of how to do it is Lockheed’s Skunk Works.
A skunkworks project is a project developed by a relatively small and loosely structured group of people who research and develop a project primarily for the sake of radical innovation.[1] The term originated with Lockheed’s World War II Skunk Works project.
There are two indicators that tell me that Fastly is the better choice. Covid-19 has put a lot of additional stress on the Internet to the point where I have noticed a lot more outages, many of them involving Cloudflare, and second, Mr. Market likes FSLY better. Now that the Tik Tok incident seems resolved, FSLY is taking off again
I’m not a techie but have seen some tech-savvy folks praise the new offerings.
And they sure put up an impressive array of leaders they interviewed, past and present, including Eric Yuan, Woz, Eric Schmidt, CEOs of DocuSign, Slack, Rent the Runway and more. Prince seems to have them deeply entrenched among the elite of the elite in tech.
Curious if you made your decision to ditch NET prior to their big week?
Also a recent outtage that was blamed on Cloudflare was actually due to another company. I haven’t seen any meaningful reports claiming they are at buckling under the pressure. And my guess is its just the opposite as this massive virus-induced stress test will strengthen the next generation of leading cloud/net companies by forging them in fire.
There are two indicators that tell me that Fastly is the better choice. Covid-19 has put a lot of additional stress on the Internet to the point where I have noticed a lot more outages, many of them involving Cloudflare, and second, Mr. Market likes FSLY better. Now that the Tik Tok incident seems resolved, FSLY is taking off again
Denny,
Thank you for your post and for all the others which I regard as an original, commonsense, and useful viewpoint on whatever you choose to talk about.
So I take very seriously your comment that FSLY is “the better choice” . There have been extensive deep reviews of each company on this board and notably also by Poffringa. So much so that I have gone back and forth on the relative merits of the two more than once.
I initially bought into FSLY at about 16 but performance by NET and some of the reviews convinced me it was the superior choice, notwithstanding the fact that each company serves somewhat different markets. So (1st mistake) I traded FSLY for NET. Further study convinced me that the innovative rearchitecturing of CDN systems by FSLY and in particular the strong results of the beta for “Compute at edge” portended well for FSLY. So I decided to reverse my decision. But(2nd mistake) I hesitated just a day or so and FSLY ran up to $46 and then continued to advance. Adjusting the portfolio I managed to acquire a 12% holding . At the same time I built a 6% position in NET. NET has recently announced a variety of new offerings and alliances and has also begun to offer free access to some of its services which I think will stimulate more enterprise interest and drive growth in NET’ revenues.
I’d like to pose some simple questions about the points you raised.
If cloud outages are a result of Covid stress, wouldn’t this be just a temporary issue. NET is customer focused and I expect they will take strong steps to address this problem.
Doesn’t the offer of free access and some of the newly announce offerings increase the potential for future expansion and revenue growth for NET…
Given that FSLY has run up in price the way it has,coupled with the fact that NET and FSLY have somewhat different marketplace demographics , doesn’t that imply that there will be less price divergence going forward rather than more?.
On the other hand, do your observations make a case for trading NET for FSLY or even perhaps for a superior grower some of which have been extensively discussed here.?
Thank you for whatever insights you care to provide.
Posting this to let you know that it was a hard decision but I finally sold OKTA and NET in the recent past. It was indeed a little hard to let them go after having written about them a number of times. ( https://discussion.fool.com/net-vs-fsly-which-is-better-34517311…… )
Denny,
I just read the post by Broadway Dan who references some of the point I alluded to in my prior post including details about the recent developments in regard to NET.
If cloud outages are a result of Covid stress, wouldn’t this be just a temporary issue. NET is customer focused and I expect they will take strong steps to address this problem.
Sorry, wrong perspective. The Internet will always be stressed, sometimes more, sometimes less. Service providers will always try to improve and there is no reason to doubt that Cloudflare will do the best they can to improve. These are not the issues I’m addressing. Why does the Fed do stress tests of members banks? Why do they do crash tests of cars? Bird strikes of jet engines? To detect problem areas. Unintentionally Covid-19 did it for the Internet. My Cloudflare experience is just anecdotal but I did not experience any Fastly outages but that too is just anecdotal. BUT, where there is smoke there’s fire. My takeaway is that this bit of anecdotal evidence confirms my assessment of the relative strengths of the two products. It’s all it is.
Doesn’t the offer of free access and some of the newly announce offerings increase the potential for future expansion and revenue growth for NET…
Possibly but, as above, that does not address my assessment that Fastly’s architecture is superior to the old CDN architecture nor the potential of their edge product.
Given that FSLY has run up in price the way it has,coupled with the fact that NET and FSLY have somewhat different marketplace demographics , doesn’t that imply that there will be less price divergence going forward rather than more?.
No. Winners continue winning. Losers continue losing. At least, that’s the way to bet the odds.
On the other hand, do your observations make a case for trading NET for FSLY or even perhaps for a superior grower some of which have been extensively discussed here.?
It’s not my business to tell people how to invest and it’s discouraged on this board. That said, it’s the way I would bet.
I’m not a techie but have seen some tech-savvy folks praise the new offerings.
And they sure put up an impressive array of leaders they interviewed, past and present, including Eric Yuan, Woz, Eric Schmidt, CEOs of DocuSign, Slack, Rent the Runway and more. Prince seems to have them deeply entrenched among the elite of the elite in tech.
Curious if you made your decision to ditch NET prior to their big week?
Hi BD, thanks for your appreciation.
Like I said before, I like NET but I think FSLY is a disrupter. Their developer focus is what I am really impressed with. That singular dev focus to me is why I see them dominating the CDN space in the years to come. Again like I mentioned before they are making devs think and design code that takes advantage of the edge. Think about the customers of FSLY; they include the very best of the software and services companies in the world today. There’s a reason for that. The reason being that some of the best devs for all those companies are working together with FSLY to build computing at the edge (CDNs in this context). With the massive shift to online every business has to be competitive and will need to stay ahead. Even if some companies are reluctant to spend on hiring good devs they will have to at some point in order to stay competitive with the best companies out there. I can envisage software moving towards availably, perfromance/speed and more computing at the edge and NOT in the other direction. Avoiding as many round trips as possible to the Origin/Server for logic execution and allowing that to happen at the edge is going to be a differentiator.
Remember that Tobias Lutke was so frustrated with the then available tools to build an online store that he went on to build Shopify from the ground-up. Eric Yuan’s frustration with Webex made him build Zoom from the ground-up. FSLY has done the same with CDN.
Cheers!
ronjonb
Observability at The Edge with Fastly and Datadog (people like me find these kind of videos interesting but most folks would find them boring :)): https://www.youtube.com/watch?v=NH0Y9gfxtns
Key Features - High-performance V8 JavaScript Engine - Based on the web standard Service Workers API - Securely sandboxed - Prescripted deployment recipes - Apply custom logic expressions for routing and caching at the edge - Fast startup times at all locations - Deployed across Cloudflare’s 200-city network within seconds - Fast key-value storage with Cloudflare Workers KV - Workers WebAssembly Support
Check out the quote from npm too! This is a tool used by developers all over the glob to help manage code packages and dependencies (your code package uses other packages and you need to control the versions of those, and a lot more).
WebAssembly is mentioned. I don’t think Cloudflare is contributing to WASI, which sounds like the future for next-generation applications, but they could still end up using it (Fastly IS contributing to this opensource effort with Mozilla.org)
…but it is just so early…how can you know how this will play out? Which is why I own both. They were both around 12.5% of my portfolio but Fastly has gone up a little to take the lead. I’m just going to let these two race for the win ;). At this point I don’t see any compelling reason to abandon Cloudflare. Maybe we will know enough a year from now to make a call, once Fastly has a little time with Compute@Edge out in the wild.
There is more to it than the tech too. They have different approaches from target customers to billing structures. This next quarterly report round is going to be very interesting!
While I generally agree with everything said in this thread about Fastly, I have to disagree with the tone used for Cloudflare. Remember…
Well I just try to share my insights about how I feel about the companies I’m invested in and their technologies; since I’m hands-on on a lot of these in my day job.
It looks like some of you were offended by my tone. It wasn’t my intention.
Well I just try to share my insights about how I feel about the companies I’m invested in and their technologies; since I’m hands-on on a lot of these in my day job.
It looks like some of you were offended by my tone. It wasn’t my intention.
I think I’ll stop sharing my perspectives.
Cheers!
ronjonb
I honestly don’t see anything that suggests anyone was “offended”. This wouldn’t be a good board if there weren’t dissenting opinions backed up by some reasonable logic. And even if that were the case, it’s best to give people the benefit of the doubt on the board as sometimes specific wording, even potentially in someone’s second language, may give the connotation of negativity but not be meant in that manner in any way. Your original opinions on FSLY vs NET are probably shared by many on the board, given the relative position sizes, although it’s hard to know how much of that is just following along with the crowd.
For me, I’ve surmised that since FSLY is going after the enterprise, high end market, they are required to do more in terms of innovation to optimize speed as much as possible, whereas NET is trying to bring features to the mass market but doesn’t necessarily need to be best in breed technologically. As long as both are growing nicely, I don’t mind owning both.
Well I just try to share my insights about how I feel about the companies I’m invested in and their technologies; since I’m hands-on on a lot of these in my day job.
You had some very good insight. The others have every right to their opinion and to be wrong. If you look at the one year chart of Net and FSLY it shows exactly who the market likes.
I want to be invested in the best companies, not the cheapest, not the second best, but the best. I might be wrong on some of the companies, but the ones I am right on will hit it out of the park. Looking at the chart on Net and Fsly it is very clear which company is the best.
That wasn’t directed at you! I said “in this thread”, meaning literally my impression of the aggregated comments by all in here. By “tone”, I meant it sounded like Cloudflare was being painted as subpar tech rather than simply different. My post was an attempt to add a different voice to this thread even though I agreed with most of it.
Please continue to share! I appreciated this thread so much I replied to it
This board is invaluable to me and I’ll stick around
One of the effects of COVID-19 (that’s a little unnoticed) is that all of a sudden a ton of internal applications ( think applications like HR etc) had to be made external so that WFH could be possible. Many business had to do that asap and as smoothly as possible. Any internal application that is suddenly made external is only a few milliseconds from the next attack.
Signal Sciences took care of much of that load. More than 80% of business after trying competitive products decide to go with Signal Sciences.
FSLY + Signal Sciences is a deadly combination as we transition into the future of apps on the cloud. As we transition from monolithic architectures to microservices. From on-premises to the Cloud. From Waterfall to CI/CD.
By “tone”, I meant it sounded like Cloudflare was being painted as subpar tech rather than simply different. My post was an attempt to add a different voice to this thread even though I agreed with most of it.
Our job here is not to pick the best technology but to pick the best investment. Unfortunately positions often become quasi religious in fervor and that is a no-no. It’s why Tesla is banned around here. Let’s stick to making money! FSLY yesterday paid for 12 months’ rent!
Glad that the thoughts I laid out while starting this thread is playing out well.
Nice day for FSLY and DDOG
I’m tied down completely with my day job
(CI/CD, Terraform, monitoring and all the interesting stuff) and will try and write about my thoughts on my next favorite CRWD as soon as I can. They have a lot of good things going on.
