Sean O'Connell

Blog

Location: Las Vegas, Nevada

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How much is data ownership worth?

I am a big proponent of self-hosted and self-owned information services. I firmly believe in the tenet of data ownership, and the inherent benefits thereof. Since 1997 - when I purchased my first Internet domain name - I have been hosting my own information services to one degree or another. For the last five years, I have been fully breaking any dependency on centralized, proprietary services and moving that functionality to self-managed applications.

This post isn't intended to be a "how to" document for implementing self-owned infrastructure. I may do one of those (or a series of those) later. Instead, it's a look at the financial costs of providing for one's own digital services. Indirectly, looking at these numbers on a personal level may allow us to extrapolate the value of one's personal information to the companies who invest millions of dollars in infrastructure to collect and hoard that data.

What services are we talking about?

For pretty much any task that I might perform online, I provide the systems and applications to host those services myself. That list includes:

  • Email and related services
  • Productivity (calendars, contacts, notes, etc.)
  • Syncronization services
  • Chat and collaboration
  • Voice and video conferencing
  • Website and blog hosting
  • Domain name services
  • Cloud storage
  • Code versioning and sharing
  • Photo sharing
  • Authentication services
  • Federated social networking
  • Other common online services (avatar lookup, pastebin, link shortening, file sharing, etc.)

Simply put, there are not any services upon which I rely that I do not also self-host and manage. All of this comes at a cost, not only of my time but also in terms of direct financial outlay. Let's look at a breakdown of the numbers.

Hardware infrastructure

I utilize only Free Software that is generally available at no cost. However, I still require hardware on which to run that software. I host a number of non-public systems on-premises in my home for secure local applications and data storage. This infrastructure is comprised of:

  • (1) firewall
  • (2) virtual host servers
  • (1) utility server
  • (1) network-attached storage appliance
  • (2) network switches
  • (2) wireless access points

I purchased some of this equipment new, and some I bought used. In total, the hardware involved (including component costs) represents about US$6000 in expense. This (relatively minimal) setup provides me with fault-tolerant storage, a virtual hosting environment sufficient for my needs, and a network infrastructure capable of supporting the necessary connectivity.

Based on my best estimates, the electricity costs for running all of this equipment comes out to about US$8 per month, or US$96 per year. That figure is actually remarkably low considering the functionality the equipment provides, and that low energy consumption is due to my penchant for buying small footprint, low power server and network equipment. Doing so is surprisingly more expensive than buying cheap end-of-life enterprise-grade servers, storage, and networking equipment from secondary markets such as eBay.

However, buying the smaller gear saves on space, cooling costs, electricity costs, and noise. Personally, I feel it's worth the trade-off and probably makes up for the added equipment costs in utility savings over the lifecycle of the equipment. It's also generally cheaper to source replacement parts when needed, because instead of buying enterprise-grade disks, memory, and power supplies I'm able to purchase cheaper consumer-grade alternatives.

Cloud infrastructure

Unlike some self-hosters I don't provide public-facing services on my home Internet connection. This is a preference based on years of experience having to deal with and work around restrictions, performance issues, and service outages inherent to consumer-grade ISPs.

Instead, I prefer to utilize a VPS hosting provider to run my virtual machines for public-facing applications. The VMs themselves are my own custom operating system images and are completely managed by myself, but I leverage an IaaS provider for storage, compute, and bandwidth resources.

While I find this model provides me with better performance, reliability, and availability of the services I run, it also brings with it a monthly recurring expense for hosting.

Currently, I host 10 virtual machines in two geographically diverse datacenters. The monthly recurring cost for these 10 hosts and associated bandwidth represents US$72 per month, or US$864 per year.

Name registration

I currently own 21 different registered Internet domains. Some of these were for defunct projects or have otherwise been deprecated, but there are 14 personal and professional domains that I intend to maintain in perpetuity. The average renewal costs for those domains is about US$12 per year, per domain. This contributes another US$168 in annual recurring expenses.

It's starting to add up

Doing the math, that brings the total annual recurring costs for my personal Internet services infrastructure to US$1128, or US$94 per month. That cost alone is higher than what I pay monthly for my 300Mbpsx30Mbps home broadband connection.

I try to get a five year lifecycle out of my hardware investments, so if I amortize the US$6000 in hardware costs over that period of time I get another US$1200 per year in expense. In addition, I budget US$500 annually for hardware repair or replacement costs (failed components, cables, etc.). Which brings my total annual cost of information self-ownership to US$2828 per year or roughly US$235 per month.

Let that sink in for a moment: US$235 per month to supply all of those common Internet services that online companies provide to you "for free". Even given their massive economies of scale, how much does it cost Google every month to supply you with all of the services you use? Or Facebook, Instagram, Twitter, et al? Even if their cost to provide those services is 1% of my own, that still represents US$2.35 per month per user - times hundreds of millions of users.

These companies are for-profit entities. If they are providing these services at such costs to themselves, how much are they earning through the collection of information about your lifestyle, personal relationships, websurfing habits, and shopping preferences? How much is your data really worth to them?

How much is your privacy worth to you?