The Cost Advantage Controversy of Cloud Computing

July 19, 2011 No Comments

One of the topics most associated with cloud computing is its cost advantages, or lack thereof. One way the topic gets discussed is “capex vs. opex,” a simple formulation, but one fraught with meaning.

At its simplest, capex vs. opex is how compute resource is paid for by the consumer of those resources. For example, if one uses Amazon Web Services, payment is made on a highly granular level for the use of the resources — either time (so much per server-hour) or consumption (so much per gigabyte of storage per month). The consumer does not, however, own the assets that deliver those resources. Amazon owns the server and the storage machinery.

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