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Disk Space Upgrades [Mar. 7th, 2005|04:13 pm]
Paid Members

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[jproulx]
If you're interested, we're asking people to help us test our new disk space upgrade purchase options. More details can be found in fotobilder_user.
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Comments:
[User Picture]From: noweb4u
2005-03-08 01:09 am (UTC)
The trick here is that 99% of the users don't use the disk space. The 1% that do, use a decent amount (and don't forget the costs of bandwidth, if you upload a photo and post it, LJ's image hosting servers get a hell of a beating for the first few seconds as all your friends load the image.).
Thus, the 1% that do use it, and need more than 100MB, will be a significantly more serious load on the servers than someone who either doesn't use it at all, or uses it only periodically. So offering 100MB to everyone for free with their account is a loss leader in a way. Get you hooked on the service, and when you become a heavy user, you pay. Think of the 100MB as free, since LJ could not reasonably support every paid user using up their entire 100MB quota as it stands right now. That would be in the upper stratosphere of terabytes, if not petabytes (according to the stats page, that would take about 9.8 Petabytes, if I did the math correctly).

Summary: the free 100MB is only economical because the majority won't come close to using it. Those who do, pay more, since they're a far more siginificant strain on the system.
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From: uxsquared
2005-03-08 01:20 am (UTC)
"The first hit of heroin is always free." -- an old, wise friend of mine

Your entry makes a lot of sense. I come nowhere near my quota limit anymore, only because I don't make a lot of phoneposts like I once did. I do use the Image Hosting feature a lot, but I don't have a lot of publicly-viewable galleries.

Boy, the lj-staff must love a guy like me. :( Maybe I should start taking advantage of their storage space ... after all, I'm paying top-dollar for it!!
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[User Picture]From: homunculus
2005-03-08 01:50 am (UTC)
haha, nice icon.
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[User Picture]From: homunculus
2005-03-08 02:04 am (UTC)
now i can see why it's your default. :)
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[User Picture]From: njyoder
2005-03-08 01:21 am (UTC)
That's ridiculous, it's not a loss at all. They take all of this into account in their business model. It's a principle called overselling, bandwidth providers do it all the time. So does every other company that offers storage space. Companies ALWAYS oversell by such a wide margin that they make a huge profit. So they took into account that 1% of heavy users in their calculations so that they'd still make a hefty profit.

Plus storage space is cheap as hell, even terabytes are cheap. You can get reasonable priced 1/3rd terabyte hard drives now. They are GROSSLY overcharigng here and there is no amount of justification for it. They can take all the strain at current income and profit well. This is just a scam under the guise of "testing" to get people to buy space they don't need.

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[User Picture]From: asmor
2005-03-08 01:31 am (UTC)
I wouldn't say it's a scam... there's certainly nothing forcing you to use their service. Anyone who does even a little bit of shopping around will see much better deals available.
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[User Picture]From: njyoder
2005-03-08 01:39 am (UTC)
That's the thing though, they know most people won't shop around. And they're pretending to be doing "testing" here which is an obvious lie. They is a poorl diguised advertisement that they know many members are going to fall for. It's a psychological scam.
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[User Picture]From: noweb4u
2005-03-08 01:50 am (UTC)
Umm, Livejournal makes around $2.4 million dollars a year, worst case scenario, based on paid account users multiplied by the cheapest payment option ($25/year).

Yes, LJ is engaging in PsyOps to get an extra few hundred for their hookers and blow habit. It's totally worth risking trust over for that few hundred.

You're either out of your mind (you can start by taking off the tinfoil hat, it won't actually effectively block EMF or RF unless it's grounded anyway), or on drugs.

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[User Picture]From: noweb4u
2005-03-08 01:44 am (UTC)
Yes, single drives are cheap. Single machine shared hosting is cheap. Running a multi-petabyte storage array (which, by the way, must be redundant as a matter of course, you wouldn't want a single drive failure taking out the entire array), and it all must be backed up somewhere.

Your data, on a properly configured system, is striped across tens if not hundreds of drives, depending on configuration. The controllers of these drives far outprice the drives themselves.

Furthermore, the costs of transfer (note that they are not limiting your transfer at all) are not included in your equasion, nor are the cost of SCSI drives with 3 year warranties (which provide incentive for manufacturers to not cock them up, since they'll find themselves spending tons of money to replace them - this means that it's rare to see the top capacities at the enterprise level, since they go through lots of quality assurance testing before they make it to the consumer end), 10,000 RPM platters (not your average desktop drive, which is often 5200 or 7200 RPM, they couldn't even begin to keep up with this level of load), and ungodly amounts of cache so that the array isn't overtaxed under medium load (think 4-5 GB of memory for cache, as a reasonable start).
Then you have to count into the equasion the costs of the storage controller itself (which yes, that cache is part of), which usually cost somewhere in the medium to high 6 figures, the costs of powering that many disks (yes, you don't pay for metered power in a datacenter, but you almost always pay per 20A circuit. My measly 4TB array takes 2 60A 240VAC outlets to itself, which have to be on seperate circuits. I don't even want to think above about 40TB.

Add in the costs of a card-not-present credit card authorization (for me it's $0.20, plus 2.20% if I remember correctly, so there's about $0.50 of the $10 right there.

Then someone who has skills and knowledge and experience dealing with large arrays, and their optimizations, backups, and how to even configure it initially, they can demand a pretty decent salary, which adds to the costs as well.

This isn't your standard everyday mom and pop hosting environment. If you want to spend your $10 dinking around with homebuilt, warrantyless rackmount machines build as cheaply as possible, with no serious backup or even often drive mirroring, and then still worrying that someone's gonna slashdot something you did and drive you bankrupt in transfer overages, you can do that. The difference here is that you pay these guys, upload some photos, and you're done. They dick with everything for you, and at the end, you get your photos hosted. You're comparing apples to oranges. If you don't like it, don't pay.
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[User Picture]From: njyoder
2005-03-08 01:54 am (UTC)
Who the hell is going to be running a multi-petabyte data array? NO ONE. They are not using that much space.

The controllers of these drives far outprice the drives themselves.

Another one time cost which really isn't that high.

Furthermore, the costs of transfer (note that they are not limiting your transfer at all) are not included in your equasion

Costs of transfer, you mean spending a few minutes (at MOST) transferring a data over gigabit ethernet? Costs practically nothing.

My measly 4TB array takes 2 60A 240VAC outlets to itself, which have to be on seperate circuits. I don't even want to think above about 40TB.

Good thing they're not hosting 40TB or anywhere near that.

Add in the costs of a card-not-present credit card authorization (for me it's $0.20, plus 2.20% if I remember correctly, so there's about $0.50 of the $10 right there.

Wow, a tiny percentage for CC charges, oh my!

Then someone who has skills and knowledge and experience dealing with large arrays, and their optimizations, backups, and how to even configure it initially, they can demand a pretty decent salary, which adds to the costs as well.

LJ has no such experts. See: last LJ blackout.

They dick with everything for you, and at the end, you get your photos hosted. You're comparing apples to oranges. If you don't like it, don't pay.

Except for the fact that tons of other services offer the same stuff for much, much cheaper and have much better redundancy and experts maintaining the systems. Your numbers don't add up, it's still grossly overpriced both in terms of any estimates you can make and actual costs for other businesses.
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[User Picture]From: mr_z
2005-03-08 02:22 am (UTC)
LJ has no such experts. See: last LJ blackout.

Errr... no amount of expertise will prevent against some unrelated hitting the big red mushroom kill-switch at the hosting site that you have no physical control over...

Granted, some of the database cockups might've been prevented if they were a little more paranoid, but some paranoia only comes from direct experience. So, while they weren't perfect, they weren't fully culpable either.
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[User Picture]From: noweb4u
2005-03-08 03:24 am (UTC)
Who the hell is going to be running a multi-petabyte data array? NO ONE. They are not using that much space.


I was off by a bit. Okay, so lets do the math on the largest enterprise disk you can get (300GB Hitachi ultrastar). With RAID 5 (which offers the best redudancy the cheapest, many places don't use this, in favor of RAID 10, which requires double the disk space, for full mirroring), that's 6,640,000 MB for a 4 TB array, which would hold 16,000 users at 250MB, assuming there are no 100MB users at all (unlikely), or 40,000 unpaying users at 100MB. Sure, neither is currently even close, but over the next year or so, it very well could be. (and there WILL be users that use more than 250MB, especially as time goes on and they don't feel like archiving it somewhere and taking it offline).

Okay, so let's do the math on the drives. I found a steal on them, free second day shipping, $925.00 apiece. That's assuming they have U320 SCSI rather than Fibre channel, which is more common in enterprise storage.
That's 23 drives, for a total cost of $21,275.

They would have to sell 2128 accounts to pay for the drives alone, which will be mostly occupied by users who aren't paying extra for it.


> The controllers of these drives far outprice the drives themselves.

Another one time cost which really isn't that high.


A used system on ebay is $38,975, and that includes a paltry 384GB of useable disk space, and I don't even think it's capable of taking the drives I quoted above.

So now, we're up for $60,250, on the mythical idea they'd want to buy a system without support, and try and cram drives into it that it wasn't designed to take. I'm shooting low here on purpose (mostly because I've never seen netapp's quotes for a 4TB filer)

That's now 6025 accounts to subsidze this machine at paid user only levels.


Furthermore, the costs of transfer are not included in your equasion

Costs of transfer, you mean spending a few minutes (at MOST) transferring a data over gigabit ethernet? Costs practically nothing.


Real datacenters charge by your 95th percentile. An average website takes less than 1MB 95th percentile. I would put livejournal somewhere around the 50MB/sec mark, 95th percentile. Livejournal apparently gets around 100,000 queries per second, according to their presentation, estimating 1k of transfer per hit, which is a conservative number.

That's $2,500/mo for the line, as it stands, with no further traffic, estimating a really cheap price of $50/mb for 50MB commit on a 100MB burstable connection.

That places a lowball figure of $30,000/year for bandwidth, which would go up. Yes, LJ currently pays for this. We'll estimate that it brings up traffic another 10 MB/sec, which is another $500/mo. Not much, you're right, but it adds up, as they must add this into their infrastucture costs as well.


Add in the costs of a credit card authorization (for me it's $0.20, plus 2.20%, so there's about $0.50 of the $10 right there.

Wow, a tiny percentage for CC charges, oh my!


For our 6000 users, that totals up to be $3000 you can't count on.
(Which drags the minimum users back up a bit)


Then someone who has skills and knowledge and experience dealing with large arrays,[...], which adds to the costs as well.

LJ has no such experts. See: last LJ blackout.


No, you're just an idiot. They just didn't protect against both power supplies at their datacenter failing, along with the battery plant, the generator, and the transfer switch. That's a freak thing, and if they only have $2.5M/year with no outside investment I'd not expect them to replicate their site in a different datacenter.
They manage several hundred servers to provide an overall uptime of 99.9% over a 3 year period, for a free service, where only a few percent actually pay to use it. Yea, you're right, they're dumbasses.

I presume you could do better?
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[User Picture]From: mr_z
2005-03-08 02:18 am (UTC)
Disk space is cheap. It's the backups that are expensive--unless you RAID things out the wazzoo and fly without them.
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[User Picture]From: njyoder
2005-03-08 02:21 am (UTC)
Backups are cheap, disk space is more expensive. This has alread been covered anyway, other businesses let you store much, much more for much less. This is overpriced no matter who you compare it to.
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