I’m running both physical hardware and cloud stuff for different customers. The problem with maintaining physical hardware is getting a team of people with relevant skills together, not the actual work - the effort is small enough that you can’t justify hiring a dedicated network guy, for example, and same applies for other specialities, so you need people capable of debugging and maintaining a wide variety of things.

Getting those always was difficult - and (partially thanks to the cloud stuff) it has become even more difficult by now.

The actual overhead - even when you’re racking the stuff yourself - is minimal. “Put the server in the rack and cable it up” is not hard - my last rack was filled by a high school student in a part of an afternoon, after explaining once how to cable and label everything. I didn’t need to correct anything - which is a better result than many highly paid people I’ve worked with…

So paying for remote hands in the DC, or - if you’re big enough - just order complete racks with racked and pre-cabled servers gets rid of the “put the hardware in”.

Next step is firmware patching and bootstrapping - that happens automatically via network boot. After that it’s provisioning the containers/VMs to run on there - which at this stage isn’t different from how you’d provision it in the cloud.

You do have some minor overhead for hardware monitoring - but you hopefully have some monitoring solution anyway, so adding hardware, and maybe have the DC guys walk past and inform you of any red LEDs isn’t much of an overhead. If hardware fails you can just fail over to a different system - the cost difference to cloud is so big that just having those spare systems is worth it.

I’m not at all surprised by those numbers - about two years ago somebody was considering moving our stuff into the cloud, and asked us to do some math. We’d have ended up paying roughly our yearly hardware budget (including the hours spent on working with hardware we wouldn’t have with a cloud) to host a single of one of our largest servers in the cloud - and we’d have to pay that every year again, while with our own hardware and proper maintenance planned we can let old servers we paid for years ago slowly age out naturally.