alt Hacker NewsThese prices have absolute nothing to do anymore with memory prices. Do not forget that Hetzner already increased the setup fees by a factor of 4x before to compensate for the price. And also servers getting price increases.
It seems they have shifted by reducing the setup fees, and increasing the monthly costs. As this generates more revenue. And its easy to prove this...
AX42 ... Its 8700GE that has gone from 65 Euro to 225 Euro. With the setup fee now being 112 Euro instead of 225 Euro. It has 64GB memory, and 1TB storage. The storage even in todays market is 100 Euro. The memory is 644 Euro.
Do the math ... Hetzner servers had a hardware payback periode of between 9 to 11 month if you took the market value. This calculation has always been very stable over the 20 years i used Hetzner.
This new price, reduced the hardware payback periode to ~4 month. It seems to be that Hetzer is trying to use the memory price issues, as a excuse. The revenue of those same servers now increased to a insane level. More revenue with less hardware.
The real issue is that a lot of companies are moving from US hosting to EU hosting because of the problems with the US. Hetzner sees this as the perfect time to cash in on Enterprise customers.
They have been trying to replace the "cheap" normal consumers with enterprise. This trend has been going on for a while already.
Every customer that now leaves, is a server they can rent out to business customers.
If you want to see the same thing, look up what happened to Microsoft/Github Copilot where they turn around has been sudden and very strong, with a clear goal of moving everything to enterprise.
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Also, a price increase like this can be used to address over-subscription/under-utilization .. there will be a lot of dormant chaff blown off by this, or in other words the provisioning demand will also be adjusted by this aggressive price change, imho.
> It seems they have shifted by reducing the setup fees, and increasing the monthly costs.
Monthly costs have gone up as well. Payroll has seen significant increases in Germany, construction has exploded far beyond inflation and, most importantly, electricity prices are still ridiculous due to merit-order and the refusal of splitting up Germany into multiple power pricing regions.
The big increases here are for their cloud product, which is hourly billing with no setup. In that context it seems more reasonable. I guess we need to remember that hourly billing and flexible prices cut both ways, eh?