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[Blog] Why Cloud Storage on Sia will be $2 / TB / Mo for the long term

One of the frequent claims of the Sia network is that over the long term, storage will be cheaper than $2 / TB / Mo, assuming that storage economics do not change. Though we’ve claimed this many times, we’ve never published a detailed model explaining where this number comes from. Until now.

For the purposes of this model, we are going to be assuming an endgame where Sia has substantially outgrown all of the latent / unused storage in the world, where the only way Sia can continue to grow is by having new datacenters established for the sole purpose of profiting from selling data to the Sia network. You can follow along with the math using this spreadsheet.

Uptime Math

One of the key ways that the Sia network distinguishes itself from traditional cloud storage is its datacenter architecture and requirements. The Sia network only expects hosts to have a 95–98% uptime. Despite this, the Sia network is able to achieve 99.9999% uptime for files. This is because each piece of data on the Sia network is stored on many hosts, requiring only a subset of them to be online in order for the file to remain available.

Today, data is typically stored on the Sia network with a 10-of-30 redundancy scheme. This means that there’s a 3x overhead, and that as long as any 10 hosts are online, the file itself is still retrievable. Once the Sia network is more mature, we will likely be switching to 64-of-96 hosts.

If we assume that the 30 hosts go offline independently, and each host has a 95% chance of being online over a given time interval, the equation to determine the probability that a file is unavailable looks like this, giving a result of 10^-19, or 18 nines of uptime. Practically speaking host failures are not truly independent and you have to account for black swan situations like world war three. The true reality is that no system actually hits 18 nines of uptime (nor 11 nines of reliability).

Amazingly, even though 64-of-96 is only 1.5x...

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