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Here is how I would go about estimating the budget required to store all Facebook photos.

The total budget required to store all Facebook photos equals cost per 1GB of Facebook photo x total size of all Facebook photo’s in GB.

First, let’s calculate the estimated cost per GB of data storage.
I pay $10 per month for 1,000 GB of data on Dropbox. Assuming cost of data storage is 30% of revenue and each paid account utilization is 20%, we can assume the cost per 1,000 GB of data for Dropbox is ($10 x 30%) / (1,000GB x 20%) = $3/200G = 1.5cent per GB per month

Now, let’s think estimate the total size of all Facebook photo’s on Facebook.
I would break down the Facebook users by two attributes (high speed / low speed internet users) and (age demographic). Here is how the table will look like

Total volume of Facebook users – 1.5 billion
Assume equal age distribution among people in age range of 20 to 70. Meaning, in each age year, there are 30 million users.

High speed internet users – 60% of all users – 900 million
Age range 20 to 30 (20% of the total age range) – they post 100 pictures per year. Have been on FB for 7 years.
This group has posted 900 million x 20% x 100 pics x 7 years = 126 billion pics so far
Age range 30 to 45 (30% of the total age group) – they post 20 pictures per year. Have been on FB for 10 years.
This group has posted 900 million x 30% x 20 pics x 10 years = 54 billion pics so far
Age range 45 to 70 (50% of the total age group) – they post 5 pictures per year. Have been on FB for 5 years.
This group has posted 900 million x 50% x 5 pics x 5 years = 11.25 billion pics so far

Total # of photos posted in high speed internet areas so far: 126 + 54 + 11.25 = 191 billion photos
Assuming a photo saved in Facebook in this area is 2MB, total storage required is 191 billion x 2MB = 380 million GB

Low speed internet users – 40% of all users – 600 million
Age range 20 to 30 (20% of the total age range) – they post 30 pictures per year. Have been on FB for 5 years..
This group has posted 600 million x 20% x 30 pics x 5 years = 18 billion pics so far
Age range 30 to 45 (30% of the total age group) – they post 10 pictures per year. Have been on FB for 8 years.
This group has posted 600 million x 30% x 10 pics x 8 years = 14.4 billion pics so far
Age range 45 to 70 (50% of the total age group) – they post 2 pictures per year. Have been on FB for 5 years.
This group has posted 600 million x 50% x 2 pics x 5 years = 3 billion pics so far

Total # of photos posted in low speed internet so far: 18 + 14.4 + 3 = 35.4 billion photos
Assuming a photo saved in Facebook in this area is 1MB, total storage required is 35.4billion x 1MB = 35.4 million GB

Total speed needed to save existing photos = 380 million GB + 35.4 million GB = 415.4 million GB

Note that I made a couple assumptions above:
Average file size in high speed internet users is 2MB. In reality, it’s much bigger but I’m sure FB has algorithms to reduce size of files before they are saved.
Average file size in low speed internet users is half of that for high speed internet users. FB is probably using lower resolution image saving in low speed internet areas to allow for faster image upload and download.
FB entered low speed internet areas about 2 years after high speed internet areas.
I’m assuming FB users are staying within same age group throughout their years of being a FB member. To be more accurate, one should consider the fact that people start in one age group (e.g. 28) and then migrate to other age groups (e.g. 35) which means number of posts will change over time.

Now, to estimate the total monthly cost of storing FB photos, I multiply 415.4 million GB by 1.5 cent per GB = 600 million cent = $6 million per month or about $70 million per year.

I think the number is a bit conservative and the real number might be higher. This might be because my estimation on the average number of years a FB user has been on the platform has been low or because the number of pics that an average FB user posts is actually higher.

answered by (15 points)
+1
I like the answer. It’s logical and explains clearly how the numbers were calculated. Great work.
0
Great answer, John. One question: Does a user who loves to post a lot of photos start to post less photos just because they go into another age bracket?

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