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The wrong way to think about IT

Andreesen Horowitz investors Sarah Wang and Martin Casado recently argued that moving to the cloud hurts profit margins and could cost public companies as much as $500 billion in collective market cap. It’s a bold, controversial claim. It’s also wrong.

Or, more politely and accurately said, their focus on cost savings may be the right answer to the wrong question. “Cost optimization always takes a backseat to decreasing time to market/feature velocity” with enterprise buyers, Duckbill Group Analyst Corey Quinn countered. Not sometimes. Not often. Always. “Fundamentally, companies that focus more on cost optimization/reduction than they do growth tend to be companies in decline,” Quinn continued.

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