NET - The 4th Public Cloud

This is an article from Apple News so hopefully it opens. I do not sub but it opened for me. Anyway, this bolded line by Prince below aught my eye. I had sold after last run-up and fears they are more about innovation and as Saul says, “altruisim” than money but this bolded line speaks to me and I bought back in today…

https://apple.news/A3qwywOnkTz-vdxk6iGOu7Q

Prince says that Cloudflare is looking at building other services beyond storage, and he sees his company eventually competing with the big three cloud vendors – AWS, Google and Microsoft. “I think that we really think we’re on the path to be the fourth major public cloud. And, and I think that our approach to it is actually much more differentiated than the other three, and so yeah, we will continue to build things out,” he said.

Bottom line, I trust Prince. And he knows what game he’s playing. I’m confident his fiercely competitive spirit carries into market cap/stock price. My hope is Amazon declines in value as they feel the loss of Bezos. Prince has been vicious and relentlessly critical of AWS for awhile now. That doesn’t feel altruistic to me. It feels like war.

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Given the anniversary letter posted by FoolforBCS in the other recent Cloudflare thread here: https://discussion.fool.com/cloudflare-takes-on-email-security-3…, it looks like we may have a number of new product announcements this week.

Here’s the one from today about storage: https://cloudflare.net/news/news-details/2021/Cloudflare-Ann…

This phrase, which is stated several ways throughout the announcement, caught my eye:

However, increasingly egregious bandwidth pricing has made cloud storage an expensive headache for some developers, resulting in vendor lock-in. Cloudflare’s mission is to help build a better Internet, which means the company is focused on making the Internet faster, safer, and also more affordable for everyone.

I agree with BroadwayDan that this is going on offense. Hey big boys, think you have your accounts locked in? We’re giving them keys to get out of your cage and come to us.

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Hi Jabbo,

I agree with BroadwayDan that this is going on offense. Hey big boys, think you have your accounts locked in? We’re giving them keys to get out of your cage and come to us.

Ok here is Google competing, So tell me why Net will win against the big boys and how this war is good for investors?

BigQuery, Google’s database for doing big data analysis, is getting the largest price drop at 85 percent. The team reduced per-gigabyte storage pricing from $0.08/GB to $0.026/GB, a 68 percent drop, and interactive queries now cost $5/TB instead of $35/TB. Batch queries now also cost $5/TB instead of the previous $20/TB.

https://techcrunch.com/2014/03/25/google-drops-prices-for-co…

Andy

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M Prince, in his original TechCrunch pitch in 2010, said “our vision is that we are going to power the Internet”. It’s worth watching his original talk mentioning Innovator’s Dilemma and having Clay Christensen as his professor.

https://www.youtube.com/watch?v=bAc_5gMwzuM

The vision of Cloudflare is NOT to ‘build a better internet’ but to ‘help build a better Internet’
In this Welcome to Birthday Week interview with M Prince and M Zatlyn discuss why the phrase ‘help build’ is crucial (after having an interaction with Brad Burnham about it in 2013)

“Our goal is to be a good actor that’s part of the overall Internet”. Dig into this, about 7th minute of this talk.

https://cloudflare.tv/event/1sgAMmqjso11lA0y0movIT

I think that’s the rallying cry, a vision for Developers, Cloudflare is arming the rebels, the rebels are the developers who want a better Internet.

And yes, I agree that Price knows the game he’s playing. Just look at “Matthew’s Hierarchy of Developers’ Needs”.

“I’d propose instead that what developers on any platform need, from least to most important, is actually: Speed < Consistency < Cost < Ease of Use < Compliance.”

The foundation is Compliance, but why? why? that was odd to me a while back but I do get this as a foundation. You must have Regulatory Compliance, a rule of law as a foundation of the better Internet.

Read about it here https://blog.cloudflare.com/cloudflare-workers-serverless-we…

There is a short paragraph on Compliance followed by The Coming Era of Data Sovereignty

While the regulations are just beginning to emerge, Cloudflare Workers already can run locally in more than 100 countries worldwide. That positions us to help developers meet data sovereignty requirements as they see fit. And we’ll continue to build tools that give developers options for satisfying their compliance obligations, without having to sacrifice the efficiencies the cloud has enabled

The war with Amazon is on, now with the announcement of R2 Storage. Cloudflare R2 Storage includes full S3 API compatibility

https://blog.cloudflare.com/introducing-r2-object-storage/

And Prince frequently takes a shot at Amazon on twitter

Why is it called R2 ? “Because it’s S3 minus the one most annoying thing: egregious egress”

https://twitter.com/eastdakota/status/1442879872154566658

Lastly, I think Prince has articulated it for me that he wants Cloudflare to ‘Power The Internet’ to be the network of networks.

Read about the Project Myriagon
https://blog.cloudflare.com/10000-networks-and-beyond/

What’s a Myriagon? In Geometry it’s a polygon with 10000 sides.

“Cloudflare now connects with more than 10,000 other networks. Put another way, over 10,000 networks have direct on-ramps to the Cloudflare network.”

“Cloudflare is an anycast network, meaning that the better connected we are, the faster and better-protected we are”

“we believe, to be one of the top 5 most connected networks in the world, we estimate Google is connected to 12,000-15,000 networks. And so, today, we are kicking off Project CatchG. We won’t rest until we’re #1.”

Of course the crucial question is: Will all this innovation and free products translate to revenue acceleration of the coming year? I will closely watch the growth of enterprise customers (1088 as of last Q with 71% yoy growth) and we’ll find out hopefully how many 10M ARR customers they have at the next Q.

Thanks.

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Wow, that is QUITE a bold claim. I wonder to what degree that this is just an Elon Musk style PR move vs. serious capability. Knowing a bit about Amazon AWS, there is quite a large moat there to cross.

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I think that we really think we’re on the path to be the fourth major public cloud.

It is a suicide mission unless he is disrupting AWS, Azure and GCP.
Moreover he is forgetting Alibaba, IBM and Oracle cloud.

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from that apple news link

“The difference, according to Prince, is that they have found a way to reduce storage costs by up to 10% by eliminating egress fees. Cloudflare plans to price storage at $0.015 per GB of data stored per month. That compares with S3 pricing that starts at $0.023 per GB for the first 50 TB per month.”

Competing in what seems to be a commodity business based on price is not the kind of company I am looking for. So hopefully this is a side venture.
Though that $0.015 price is a lot more than 10% cheaper compared to S3 price quoted

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I agree that competing on price sounds like they are out of growth ideas. Also, giving away products to developers and pontificating on how it’s one big connected internet reminded me of Scott McNealy and Sun Microsystems. We all know how that story ended…

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Seems to me this is chit-chat on this more serious board. Take it off-line or another board.

Lucky Dog

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