The serverless Internet company

I’m sure this isn’t the only one, after all, SmugMug‘s CEO told me that they had moved pretty much everything over to Amazon’s S3 a while back.

But I always assumed that companies would have at least one server keeping things up, just in case Amazon went down. Or just because.

I was wrong.

Last night Mogulus’s CEO, Max Haot, was here at my house to film something fun for my show. Mogulus is the company that, yesterday, provided the live video for Om Malik’s NewTeeVee conference. It was so good I stayed home and watched almost the whole day on the NewTeeVee channel. But more on that when we get the video up.

At one point Max seemed like he was joking around with me when he told me “we don’t own a single server.”

I asked him FOUR more times to make sure I heard him right. I even got incredulous with him at one point saying something like “what the f*** do you mean you don’t own a server?” and “you mean not a single bit of your Web site comes from servers that aren’t owned by Amazon?”

He nicely and calmly explained that, yes, every server the company owns is actually running on Amazon’s S3 and EC2 services.

The world has changed. Now ANYONE can build an Internet company and get it up to scale. No more spending nights inside data centers trying to keep servers running.

Let’s go over to Mike Arrington’s CrunchBase and do some research. They pulled in $1.2 million in funding. Yet they don’t own a SINGLE server!

They have about 15,000 people already creating live video channels. They have one of the most innovative Web sites I’ve ever seen.

But they don’t own a server.

How else has the world changed? Where the hell is Microsoft in this whole business? How did Microsoft screw this up so badly? Let’s get this straight. Amazon used to be a book store. Now they are hosting virualized servers for Internet companies. So much for having billions of dollars in the bank like Microsoft does, some of the smartest people in the world working in your research arms and having “monopoly” market share in operating systems.

Heheh, maybe now Amazon can use some of the new money that they’ll be earning from these startups to buy some decent PR. According to Read/Write Web Amazon needs the help in that department.

Oh, back to Max. One tip he gave us is that when using Amazon’s services you have to design your systems with the assumption that they will never be up and running. What he means by that is services are “volatile” and can go up and down without notice. So, he’s designed his systems to survive that. He told me that it meant his engineering teams had to be quite disciplined in designing their architecture.

How many other Internet companies are out there that are “serverless?”

Comments

  1. Hi Robert,
    We’re doing the same thing here at Podmailing. It’s a service to send files of any size by e-mail.
    We are using EC2 and S3 to relay the files, with infinite scalability. We use both BitTorrent and Http. Currently we mostly have users in Europe, but we will launch in the US in a few weeks.

    To be honest we do host a few rented servers, but essentially for development, profiling and testing : EC2 servers don’t provide enough deep-level access for that – of course, they’re virtual!

    For our full-scale platform, we plan to have all the work done on Amazon initially with probably just one server acting as the conductor of several “server grapes”. We also plan to use Amazon’s competitors to lower the risks.

    Louis.

  2. Hi Robert,
    We’re doing the same thing here at Podmailing. It’s a service to send files of any size by e-mail.
    We are using EC2 and S3 to relay the files, with infinite scalability. We use both BitTorrent and Http. Currently we mostly have users in Europe, but we will launch in the US in a few weeks.

    To be honest we do host a few rented servers, but essentially for development, profiling and testing : EC2 servers don’t provide enough deep-level access for that – of course, they’re virtual!

    For our full-scale platform, we plan to have all the work done on Amazon initially with probably just one server acting as the conductor of several “server grapes”. We also plan to use Amazon’s competitors to lower the risks.

    Louis.

  3. Please add Appirio to your list of server-less companies. We have been so ever since our inception in 2006, see http://www.appirio.com/about/philosophy.php and http://www.appirio.com/blog/2007/03/building-business-on-virtual.php.

    Using Salesforce.com as our CRM and application development platform; Google Apps for our email, calendaring, and collaboration; Quickbooks Online for our financials; Amazon’s EC2 and S3 for application and storage requirements beyond what SFDC can accommodate; and a handful of other software-as-a-service technologies, we run a very efficient IT operation! Good thing too, since our company mission is to accelerate the adoption of on-demand solutions in the enterprise.

  4. Please add Appirio to your list of server-less companies. We have been so ever since our inception in 2006, see http://www.appirio.com/about/philosophy.php and http://www.appirio.com/blog/2007/03/building-business-on-virtual.php.

    Using Salesforce.com as our CRM and application development platform; Google Apps for our email, calendaring, and collaboration; Quickbooks Online for our financials; Amazon’s EC2 and S3 for application and storage requirements beyond what SFDC can accommodate; and a handful of other software-as-a-service technologies, we run a very efficient IT operation! Good thing too, since our company mission is to accelerate the adoption of on-demand solutions in the enterprise.

  5. Hi,

    We run an email spam filtering service. This service runs on 26 servers, 22 of which are on EC2.

    I dont see a time when we will be serverless…we actually plan to run 70% of or traffic through our own servers…this will give us redundancy…we plan to use AWS to give us scalability and the burstable capacity that we need.

    We are using AWS to help us to setup our business model and prove our technology is scalable. EC2 allows us to compete with our large VC funded competitors….AWS rocks!

    Ross Cooney
    http://www.emailcloud.com

  6. Hi,

    We run an email spam filtering service. This service runs on 26 servers, 22 of which are on EC2.

    I dont see a time when we will be serverless…we actually plan to run 70% of or traffic through our own servers…this will give us redundancy…we plan to use AWS to give us scalability and the burstable capacity that we need.

    We are using AWS to help us to setup our business model and prove our technology is scalable. EC2 allows us to compete with our large VC funded competitors….AWS rocks!

    Ross Cooney
    http://www.emailcloud.com

  7. Don’s a great proponent of EC2/S3 and it’s a very cool service, but I’m not convinced Microsoft has missed anything at all, Robert. Managed hosting (Rackspace, the Planet, et al.) has been around for a long time now and it’s a low margin business!

    We have a compute cluster that crunches huge and growing amounts of data in a big distributed database. We don’t own servers either. Never have.

    We keep our stuff at a managed hosting provider so we don’t have to manage all the datacenter/IT bs that distracts our coders from coding. Plus we get essentially instant expandability, full control on the hardware and no capital required. We can add a dedicated server (fully spec’d by us) to our production cluster in under an hour. Since our compute and storage requirements never go /down/ that’s the only elasticity required!

    The Amazon services sound cool, so we keep coming back to see if they make sense for us. Haven’t been compelled to switch. Here are our reasons:
    1. We already have instant expandability
    2. We use quad-processor, big storage boxes, so we’d have to bring up a bunch of the Amazon slices to get the equivalent horsepower. There’s probably a marginal cost advantage with S3/EC2 but not so huge that it compels.
    3. No SLA. They have an SLA on the storage but not the compute offering. My managed hoster has SLAs on everything.
    4. hardware control. We get to spec exactly what we want.

    At some point we’ll reach the scale like smugmug where having the monthly operating costs get too high with this model. Managed hosting has been a fantastic asset in building our company.

  8. Don’s a great proponent of EC2/S3 and it’s a very cool service, but I’m not convinced Microsoft has missed anything at all, Robert. Managed hosting (Rackspace, the Planet, et al.) has been around for a long time now and it’s a low margin business!

    We have a compute cluster that crunches huge and growing amounts of data in a big distributed database. We don’t own servers either. Never have.

    We keep our stuff at a managed hosting provider so we don’t have to manage all the datacenter/IT bs that distracts our coders from coding. Plus we get essentially instant expandability, full control on the hardware and no capital required. We can add a dedicated server (fully spec’d by us) to our production cluster in under an hour. Since our compute and storage requirements never go /down/ that’s the only elasticity required!

    The Amazon services sound cool, so we keep coming back to see if they make sense for us. Haven’t been compelled to switch. Here are our reasons:
    1. We already have instant expandability
    2. We use quad-processor, big storage boxes, so we’d have to bring up a bunch of the Amazon slices to get the equivalent horsepower. There’s probably a marginal cost advantage with S3/EC2 but not so huge that it compels.
    3. No SLA. They have an SLA on the storage but not the compute offering. My managed hoster has SLAs on everything.
    4. hardware control. We get to spec exactly what we want.

    At some point we’ll reach the scale like smugmug where having the monthly operating costs get too high with this model. Managed hosting has been a fantastic asset in building our company.

  9. Sun also has some pretty impressive offerings for creating grid computing solutions. In fact, my partner and I at TheFightChannel.com are currently looking at both Amazon’s AWS and Sun’s solutions for running much of our scalability needs. And like Glenn’s Appirio, we are very seriously considering using other online asp’s to provide a lot of the functionality we intend to have for our site members (wiki, social network, photo and video sharing, etc.)

    I actually believe THIS is what the Web 3.0 will be all about; being able to create a company that provides valuable and unique services to its members without having to build and maintain all of the components yourself.

    Life and technology is grand, eh?

  10. Sun also has some pretty impressive offerings for creating grid computing solutions. In fact, my partner and I at TheFightChannel.com are currently looking at both Amazon’s AWS and Sun’s solutions for running much of our scalability needs. And like Glenn’s Appirio, we are very seriously considering using other online asp’s to provide a lot of the functionality we intend to have for our site members (wiki, social network, photo and video sharing, etc.)

    I actually believe THIS is what the Web 3.0 will be all about; being able to create a company that provides valuable and unique services to its members without having to build and maintain all of the components yourself.

    Life and technology is grand, eh?

  11. “One tip he gave us is that when using Amazon’s services you have to design your systems with the assumption that they will never be up and running. What he means by that is services are “volatile” and can go up and down without notice. So, he’s designed his systems to survive that.”

    That’s probably a good idea for ANY internet-scale system whether it’s hosted on your own servers or on a cloud.

  12. “One tip he gave us is that when using Amazon’s services you have to design your systems with the assumption that they will never be up and running. What he means by that is services are “volatile” and can go up and down without notice. So, he’s designed his systems to survive that.”

    That’s probably a good idea for ANY internet-scale system whether it’s hosted on your own servers or on a cloud.

  13. [...] Scoble writes about the effect that a service like S3 is having on tech startups in general: The world has changed. Now ANYONE can build an Internet company and get it up to scale. No more spending nights inside data centers trying to keep servers running. [...]

  14. This seems a little silly to me. Keep in mind that a company is anything that requires filling out a schedule c for taxes (sole proprietership.) If you run a blog which pays a few bills and you report that to the IRS then you have a web company. The number of small web companies dwarf the number of large web companies and many of the small web companies run on shared hosting.

    Of the web companies that are not running on shared hosting, many are running on a VPS or dedicated server they do not own. Of all the web companies, only a relatively small percentage have owned their own servers. I would say that running your web company on a server owned by another company has always been more of the norm than running in-house servers.

    These companies may be saving a bunch of money by running on EC2 or S3 but this is hardly a “serverless internet company.” EC2 and S3 still have real servers, real datacenters and real costs.

    Try telling their accountant that there are no servers. I am sure the accountant would disagree. EC2 and S3 can still get very expensive. I have run services on EC2 and switched back to a more traditional VPS because of the expense, but I have a very low budget. The bandwidth charges from EC2 and S3 add up very quickly.

  15. This seems a little silly to me. Keep in mind that a company is anything that requires filling out a schedule c for taxes (sole proprietership.) If you run a blog which pays a few bills and you report that to the IRS then you have a web company. The number of small web companies dwarf the number of large web companies and many of the small web companies run on shared hosting.

    Of the web companies that are not running on shared hosting, many are running on a VPS or dedicated server they do not own. Of all the web companies, only a relatively small percentage have owned their own servers. I would say that running your web company on a server owned by another company has always been more of the norm than running in-house servers.

    These companies may be saving a bunch of money by running on EC2 or S3 but this is hardly a “serverless internet company.” EC2 and S3 still have real servers, real datacenters and real costs.

    Try telling their accountant that there are no servers. I am sure the accountant would disagree. EC2 and S3 can still get very expensive. I have run services on EC2 and switched back to a more traditional VPS because of the expense, but I have a very low budget. The bandwidth charges from EC2 and S3 add up very quickly.

  16. Only issue I have with EC2 is the inability to use anything aside from Linux for the AMI. I know people who’d *kill* to have FreeBSD or Darwin on EC2.

  17. Only issue I have with EC2 is the inability to use anything aside from Linux for the AMI. I know people who’d *kill* to have FreeBSD or Darwin on EC2.

  18. > How did Microsoft screw this up so badly?

    Au contraire. Google “Microsoft Astoria.”

    http://astoria.mslivelabs.com/OnlineService.aspx

    I don’t know how much visibility it has outside of the developer community. Microsoft is not asleep on this one, even if they don’t have a service on the same scale as Amazon’s yet. I don’t know if they will win, but they are not dropping the ball. They are busy trying to win the hearts and minds of devs, which is the old fashioned Microsoft way.

    Likewise they are doing some very interesting things with virtualization, which will make hosting even more of a commodity than it already is. Want a fresh Windows 2008 box? Click, there it is. Want to add another processor and another 1 GB of RAM? Click, click, there it is.

    I don’t know if Microsoft will get into the business of renting the commodities (virtual servers, virtual storage) directly to companies, but they are certainly busy building stuff that will enable OTHERS to do so. I’m sure as far as Microsoft is concerned, it doesn’t matter whether you rent virtual storage from me, or rent it from Microsoft — as long as a SQL Server license is paid for by *somebody* :-)

  19. > How did Microsoft screw this up so badly?

    Au contraire. Google “Microsoft Astoria.”

    http://astoria.mslivelabs.com/OnlineService.aspx

    I don’t know how much visibility it has outside of the developer community. Microsoft is not asleep on this one, even if they don’t have a service on the same scale as Amazon’s yet. I don’t know if they will win, but they are not dropping the ball. They are busy trying to win the hearts and minds of devs, which is the old fashioned Microsoft way.

    Likewise they are doing some very interesting things with virtualization, which will make hosting even more of a commodity than it already is. Want a fresh Windows 2008 box? Click, there it is. Want to add another processor and another 1 GB of RAM? Click, click, there it is.

    I don’t know if Microsoft will get into the business of renting the commodities (virtual servers, virtual storage) directly to companies, but they are certainly busy building stuff that will enable OTHERS to do so. I’m sure as far as Microsoft is concerned, it doesn’t matter whether you rent virtual storage from me, or rent it from Microsoft — as long as a SQL Server license is paid for by *somebody* :-)

  20. This is a bit outdated. We (the community) have been renting, leasing, whatever you like to call it, servers for some time now. Co-lo facilities are, have been, changing to hosting facilities; give us some cash, and we take care of the server – hardware – et al., you just config it and run your software on it.

    The difference here being that Amazon has been doing this on a large scale, and taken a bit more of a “utility” approach.

    “These arent the droids we’re looking for. Move along…”

  21. This is a bit outdated. We (the community) have been renting, leasing, whatever you like to call it, servers for some time now. Co-lo facilities are, have been, changing to hosting facilities; give us some cash, and we take care of the server – hardware – et al., you just config it and run your software on it.

    The difference here being that Amazon has been doing this on a large scale, and taken a bit more of a “utility” approach.

    “These arent the droids we’re looking for. Move along…”

  22. Mr. Scoble – The Amazon Web Challenge will be revealing a LOT more really good “serverless” startups very soon. Looks like December timeframe a winner of the challenge will be picked and hoisted high.

    I actually think AWS is doing a great job on PR and turning quite a few of us into dyed in the wool believers. It’s how my bootstrapped startup will be powered.

  23. Mr. Scoble – The Amazon Web Challenge will be revealing a LOT more really good “serverless” startups very soon. Looks like December timeframe a winner of the challenge will be picked and hoisted high.

    I actually think AWS is doing a great job on PR and turning quite a few of us into dyed in the wool believers. It’s how my bootstrapped startup will be powered.

  24. >>> “I always assumed that companies would have at least one server keeping things up, just in case Amazon went down”

    IMHO if folks felt they had to keep extra hardware around this would be a showstopper to adoption of utility computing systems. At 3tera, we do have some users that keep back end systems off the grid, but it’s most often because these systems run on an OS that isn’t yet supported on the grid, like Windows. In those cases, though, the servers running those back end processes are also hosted in the same data center.

  25. >>> “I always assumed that companies would have at least one server keeping things up, just in case Amazon went down”

    IMHO if folks felt they had to keep extra hardware around this would be a showstopper to adoption of utility computing systems. At 3tera, we do have some users that keep back end systems off the grid, but it’s most often because these systems run on an OS that isn’t yet supported on the grid, like Windows. In those cases, though, the servers running those back end processes are also hosted in the same data center.

  26. I just launched Tripntale and we’re entirely using Amazon’s EC2 and S3 for our backend. So yes, we don’t have to manage any server and yet we have about 10000 pictures uploaded in the first month.

  27. I just launched Tripntale and we’re entirely using Amazon’s EC2 and S3 for our backend. So yes, we don’t have to manage any server and yet we have about 10000 pictures uploaded in the first month.

  28. Bioscreencast is also moving to EC2/S3. We have a hosted server that we use for development/staging, but all screencasts will be served up from S3 and we have other plans as well, especially for EC2.

    As people above have noted, not having inhouse servers is nothing new. It’s the flexible capacity and utility aspects of Amazon, 3Tera, etc that are so cool and novel, at least for running businesses.

  29. Bioscreencast is also moving to EC2/S3. We have a hosted server that we use for development/staging, but all screencasts will be served up from S3 and we have other plans as well, especially for EC2.

    As people above have noted, not having inhouse servers is nothing new. It’s the flexible capacity and utility aspects of Amazon, 3Tera, etc that are so cool and novel, at least for running businesses.

  30. The question you don’t ask however is “Why Amazon”?

    There are a ton of other colo, server rental, virtual computing….etc etc providers out there – what is the magic sauce that Amazon EC2 and S3 hit on that is drawing all the flies to the honey?

    Any thoughts?

    Cheers,
    Dean Collins
    http://www.Cognation.net

  31. The question you don’t ask however is “Why Amazon”?

    There are a ton of other colo, server rental, virtual computing….etc etc providers out there – what is the magic sauce that Amazon EC2 and S3 hit on that is drawing all the flies to the honey?

    Any thoughts?

    Cheers,
    Dean Collins
    http://www.Cognation.net

  32. @Dean, I think one thing that raises Amazon above the level of the typical VPS provider is that many of their services have an API, and can be hit programatically. S3 can eliminate not just the db box, but the db itself: no MySQL, no Oracle. Just pipe your data to S3.

    On http://wordie.org I’m using slicehost.com, fwiw. They don’t offer an API, so I had to install and manage MySQL. But I don’t have to deal with server maintenance, and I can add capacity easily and quickly.

    I think Amazon has it right, though: eliminate the overhead not just of the hardware, but also the lower levels of the software stack.

  33. @Dean, I think one thing that raises Amazon above the level of the typical VPS provider is that many of their services have an API, and can be hit programatically. S3 can eliminate not just the db box, but the db itself: no MySQL, no Oracle. Just pipe your data to S3.

    On http://wordie.org I’m using slicehost.com, fwiw. They don’t offer an API, so I had to install and manage MySQL. But I don’t have to deal with server maintenance, and I can add capacity easily and quickly.

    I think Amazon has it right, though: eliminate the overhead not just of the hardware, but also the lower levels of the software stack.

  34. Maybe because Mogulus is focused on live/streaming video, they have less in the way of archives to generate views/lists on.

    (For a long time the Yahoo directory was driven by static files rather than a db. On the other hand, to *search* that directory, rather than browse its hierarchy, would still require a persistent engine. On the other-other hand, maybe you could generate your index, store it on S3, etc….)

    Some actual details (I googled but didn’t find anything) on Mogulus’ infrastructure would take this beyond smoke.

  35. Maybe because Mogulus is focused on live/streaming video, they have less in the way of archives to generate views/lists on.

    (For a long time the Yahoo directory was driven by static files rather than a db. On the other hand, to *search* that directory, rather than browse its hierarchy, would still require a persistent engine. On the other-other hand, maybe you could generate your index, store it on S3, etc….)

    Some actual details (I googled but didn’t find anything) on Mogulus’ infrastructure would take this beyond smoke.

  36. Comment re: data persistence on EC2/S3…

    We (www.elastra.com) are providing a database offering (MySQL, EnterpriseDB & PostgreSQL) and file system to now allow persistent data and clustering on EC2.

    Please check us out and provide feedback! From the problems I am reading about in earlier posts we are solving the database issues many folks are referencing. We are in beta testing right now.

  37. Comment re: data persistence on EC2/S3…

    We (www.elastra.com) are providing a database offering (MySQL, EnterpriseDB & PostgreSQL) and file system to now allow persistent data and clustering on EC2.

    Please check us out and provide feedback! From the problems I am reading about in earlier posts we are solving the database issues many folks are referencing. We are in beta testing right now.

  38. In response to Bill Seitz:

    You should come check out blogTV.com. There is plenty of archivesto watch plus the added benefit of constant live streaming shows in which you can interact with the hosts and other users.

    Its a unique community and a hell of a lot of fun!

    Check it out!

  39. In response to Bill Seitz:

    You should come check out blogTV.com. There is plenty of archivesto watch plus the added benefit of constant live streaming shows in which you can interact with the hosts and other users.

    Its a unique community and a hell of a lot of fun!

    Check it out!

  40. Interesting comments – for those making use of Amazons service any complaints on reliability/stability? Any downtime?

  41. Interesting comments – for those making use of Amazons service any complaints on reliability/stability? Any downtime?

  42. [...] The Serverless Internet Company – Scobleizer At one point Max seemed like he was joking around with me when he told me “we don’t own a single server.” I asked him FOUR more times to make sure I heard him right. I even got incredulous with him at one point saying something like “what the f*** do you mean you don’t own a server?” and “you mean not a single bit of your Web site comes from servers that aren’t owned by Amazon?”This is the future – the near future. Running a business is fun. Running a NOC is not fun – and that’s a huge understatement. [...]

  43. Serverlessness: a cool concept. How precisely do they do DNS though? Amazon servers and ip addresses are volatile… what if one goes down and they lose the ip address?

  44. Serverlessness: a cool concept. How precisely do they do DNS though? Amazon servers and ip addresses are volatile… what if one goes down and they lose the ip address?

  45. [...] – Amazon s3. Stockage en ligne, professionnel pour pas cher. (0,18€ le giga par mois) + api ouverte par webservice = on peut faire des appli Web qui vont “lire” directement sur ces serveurs. => des entreprises qui apparaissent et qui n’ont pas de serveur interne ! [...]

  46. Atishae QAArtist is an Automated Testing Framework to provide functional, regression and load testing for web applications that uses AWS EC2 to scale up.

    We would be soon provisioning via DevPay for customers to launch their test suites directly off Amazon.

    (Testing Windows Apps still work off the desktop — no EC2 there, yet!)

    Visit us @ http://www.atishae.net or write to us @ qaartist@atishae.net

  47. Atishae QAArtist is an Automated Testing Framework to provide functional, regression and load testing for web applications that uses AWS EC2 to scale up.

    We would be soon provisioning via DevPay for customers to launch their test suites directly off Amazon.

    (Testing Windows Apps still work off the desktop — no EC2 there, yet!)

    Visit us @ http://www.atishae.net or write to us @ qaartist@atishae.net

  48. Don’t see why all the hubba about Amazon. I have a website that generates around 5000G traffic each month, and I’m paying $150 for the server. I did the amazon math on the site, and it would cost at least double what I’m paying now.
    And the traffic is way more expensive.

  49. Don’t see why all the hubba about Amazon. I have a website that generates around 5000G traffic each month, and I’m paying $150 for the server. I did the amazon math on the site, and it would cost at least double what I’m paying now.
    And the traffic is way more expensive.

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  52. No servers is rather impressive. I’ve been using Amazon’s ec2 for some experimenting myself, and I’ve gotta say it’s rather decent. I’m just curious about what the monthly bill to Amazon is for them if they don’t bother to check if the meter is running, lol.

  53. No servers is rather impressive. I’ve been using Amazon’s ec2 for some experimenting myself, and I’ve gotta say it’s rather decent. I’m just curious about what the monthly bill to Amazon is for them if they don’t bother to check if the meter is running, lol.