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Is a Startup Crazy if They Don't Use Cloud IaaS?

Today’s tech entrepreneurs would be out of their minds to build out their own data centers rather than renting capacity from Amazon or another low-cost provider.  --Barb Darrow recounting the statements of Andy Bechtolsheim (former Sun Micro)

Really?  You'd be crazy not to use something like AWS if you're a startup?  We can all admit, the flexibility of many low-cost IaaS providers has significant advantages for new companies without a lot of cash.  But this excerpt from a GigaOM article seems to buy in a little to heavily with the statement from a guy who is running a cloud networking services company.

Just because it's cheap, doesn't mean it's the best way to go.  DZone has used both data center hosting and IaaS for different projects.  The cloud instances were the right choice for quickly spinning up SaaS instances to sell as demand grew.  Whereas, the data center we use for hosting provides the stability we need for our sites and it's located not far away so we know where the data is.

True, the pay-as-you go IaaS model, combined with a cheap open source stack, is a lucretive (and seemingly risk-free) setup for startups.  But it's not going to be the best way for everyone.



Source: http://gigaom.com/2011/11/10/arista-roadmap-2011/
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