Running a small project on Hetzner from Germany. Got the email this morning. Honestly, even after the increase their dedicated boxes are still absurdly cheap compared to what you'd pay at AWS or GCP for equivalent specs.<p>The real story here isn't Hetzner being greedy. It's that AI companies are vacuuming up every DRAM chip on the planet and the rest of us get to pay the tax. I priced out a RAM upgrade for my home server last week. Same kit I bought 8 months ago for 90 EUR is now 400+. That's not normal market dynamics.<p>What worries me more is the second-order effects. Startups that would normally spin up cheap VPS instances to prototype and iterate now face meaningfully higher costs at the exact stage where every euro matters. The "just deploy it" culture that made European indie dev scene so productive was built on sub-10 EUR/month boxes. Those days might be over for a while.
> It's that AI companies are vacuuming up every DRAM chip on the planet and the rest of us get to pay the tax.<p>DRAM is priced based on supply and demand, like every other market.<p>When demand goes up, the price goes up for everyone. It’s not a “tax” on the rest of us in any sense. There’s just a lot of demand everywhere.<p>> That's not normal market dynamics.<p>This is actually a textbook example of markets functioning in response to a demand shock where supply cannot be increased rapidly.<p>I do find it interesting that so many people think “market rate” means the opposite of what economics teaches, and that prices should stay stable and not change much when the economic conditions change.<p>I also find it interesting to read all of the “we shouldn’t let them…” takes in response to this situation. The DRAM market is international. Trying to restrict it in one country would just see the data centers get built in another country.
Saying this is just the market...is like saying housing is a free market after hedge funds buy your entire neighborhood...
But... They're not wrong. That IS the market. Unrestricted, gloriously free market with its historically predictable outcomes - yay!<p>That's not where the interesting discussion is. The interesting discussion is with the notion that free unregulated markets are universally good and will naturally lead to positive outcomes because... I don't know, I'm personally not religious, but somebody here will help me :-).
People love to say that but they own a very small percentage of housing in reality. What’s driving housing costs is also supply and demand. Especially supply, since we’re not allowed to build any houses in most places people want to live.
Prices are decided at the margins. Having PE and REITs at every single table, even if their actual ownership is small as a %, makes huge differences.
Read you response again. You are reinforcing my argument in case you did not notice...
correct, both of those things are examples of free markets
Adam Smith had already clarified free market refers to a market free from all forms of economic privilege, monopolies and artificial scarcities.<p>You are confusing market outcome with market structure.
Incumbent owners preventing the construction of more supply to maintain their own property values is not "free market". This is very basic stuff
Which neighborhoods are now entirely owned by hedge funds?
I should point out the relevance of my argument, is completely independent from the fact the reply to this questions of yours, is higher than zero.<p>So dont see this reply as a justification. Just as a note that you failed to do basic diligence on distortions that are well known. And as I said, that are not relevant to the analogy.<p>"When Wall Street Is Your Landlord" - <a href="https://www.theatlantic.com/technology/archive/2019/02/single-family-landlords-wall-street/582394/" rel="nofollow">https://www.theatlantic.com/technology/archive/2019/02/singl...</a><p>"In one Atlanta zip code, they bought almost 90 percent of the 7,500 homes sold between January 2011 and June 2012"
> It’s not a “tax” on the rest of us in any sense. There’s just a lot of demand everywhere.<p>Curious on whether you will still hold your stance if OpenAI gets a taxpayer bailout. Even disregarding a bailout, they are already lobbying hard for tax credit expansion.
> Trying to restrict it in one country would just see the data centers get built in another country.<p>I'm surprised this isn't already what's being done. Inference doesn't require super low latency with the client, and the population's support of AI (and especially data centers for it) is waning quickly. This feels like another ideal use case for outsourcing the stuff Americans don't want to see to somewhere that it'll be someone else's problem.
> Trying to restrict it in one country would just see the data centers get built in another country.<p>Sounds like not stressing the electricity infrastructure in Spain, to run inference for Facebook North American posts, should be seen as a positive...
> This is actually a textbook example of markets functioning in response to a demand shock where supply cannot be increased rapidly.<p>The problem is that demand is being propped up by speculative capital. The AI companies are a bubble that is suffocating productive parts of the market with the hording of capital which they're now using to also hoard hardware. All this without making money for data centres that aren't build yet, for a handwavy promise that an AGI will magically solve all the worlds problems.<p>This is not normal, and it is not good for the broader economy.
The problem is that OpenAI has cornered the market. Maybe they haven't crossed the legal line or more to the point no one in this corrupt and incompetent administration is going to prosecute them, but buying up 40% of a market which hasn't got any additional capacity is cornering by any measure.<p>So yes, this is not a normal market. Your claim of a functioning market is the same as saying my laptop, having lit on fire, is a functioning computer after having 10,000 volts applied across it.
Factory capacity does not follow market dynamics easily
In many countries, its illegal to manipulate prices in bulk.
Can't agree more. We can also predict with some confidence that in a year or two, supply would have adjusted and ram will be cheaper in the long run. We benefit from the expanded demand even if the fact that it first lands as a shock is disruptive to prices.
> When demand goes up, the price goes up for everyone. It’s not a “tax” on the rest of us in any sense. There’s just a lot of demand everywhere.<p>> This is actually a textbook example of markets functioning in response to a demand shock where supply cannot be increased rapidly.<p>You act like it's a competitive market. It's not the case.
It's an oligopoly with an extremely inelastic supply side.<p>The market is already completely broken and ineffective due to concentration and export controls. The actual response to a major demand shock should be investments to increase capacities but it's currently extremely limited because suppliers want to protect their margins and fear the market contracting again.
> DRAM is priced based on supply and demand, like every other market.<p>Please don't explain it away like that - you are referring to the theoretical "ideal" market where a bunch of small companies compete with low margins to the benefit of the wider customer base. This is not what is happening. We have a couple of intrinsically worthless, LLM-whale companies, working literally to swallow and entshittify literally everything in their weird transhumanist/accelerationist/weirdo way. To add to the insult, the whole creation of artificial scarcity is almost a political construct, paid for with "monopoly-the-game-money" that these companies DO NOT EARN but instead BORROW based on vague and dishonest promises of achieving a "Country of PhDs in a datacenter"/"Pocket PhDs"/"AGI by 2025" (oops, now apparently by 2028 according to the OpenAI CEO). In their weird vision, as humans we should be merely cattle to be managed, not independent spirits with interest and aspirations. That ghoul Karpathy speaks about "ghost in the machine", overlooking the magnificence of the already existing "ghost in the machine" in the form of human beings. We should not have to swallow the increasingly crappier future these folks are insisting on pushing on all of us.
Most markets don't have three purchasers trying to corner the entire supply of one product.
AI demand is subsidized by the bubble. Those operators buying the RAM are not paying using money that exists. Market economics are not working here.
"it happened therefore it's normal"
"The real story here isn't Hetzner being greedy. It's that AI companies are vacuuming up every DRAM chip on the planet and the rest of us get to pay the tax."<p>We might also have our aquifers depleted and our electricity prices skyrocket. But at least we see really great benefits, such as being able to script some side-project while unemployed due to AI.
But aren't those the same startups that think they need to run on AWS EKS instead of using a single cheap server? The cheapest used Hetzner server currently is €39.24 / month:<p>- Intel Core i7-6700
- 32 GB
- 2 x 480 GB Datacenter SSD
- 1 GB/s
- 20 TB traffic<p>Their VPS are even cheaper. And you can run <i>a lot</i> on this.
If your only need is a lot of bandwidth with very low server CPU use that’s fine.<p>That CPU is ancient, though. Over a decade old. That DRAM is 2-channel DDR3.<p>This could be a good deal for someone, but entrusting your startup’s operations to a 10 year old slow computer in Germany instead of using EKS would be an extremely short sighted move. A startup should be developing software and shipping it quickly to validate the market, not pinching pennies to save the equivalent of a couple hours of developer salary.
>That CPU is ancient, though. Over a decade old.<p>Coincidentally so are the t3 / t3a instances on AWS that everyone loves to use especially for dev/staging environments
I would guess that 99.9% of startups wouldn't notice the age of the CPU if they aren't in the business for CPU compute power.<p>Also, if you don't want to provision software systems, you probably shouldn't use Kubernetes at all. Both this and compute are niche businesses and neither would rent a budget server anyway.
While I agree with the last sentence, I would suggest you buy what is needed not what is latest.
Except 40€ a month is extremely poor value for this CPU that's more than a decade old.
No, that's actually a really good deal for dedicated hardware with those specs. For a project sized for hardware like that, the CPU is a lot less relevant than the RAM and storage and transfer.
If you need more power check out the AX line of dedicated servers: <a href="https://www.hetzner.com/dedicated-rootserver/matrix-ax/" rel="nofollow">https://www.hetzner.com/dedicated-rootserver/matrix-ax/</a>
For the 5 api requests a second most projects will get, it'll probably do.
8 threads at 3.4 GHz, 8MB cache. Seems fine, depending on your use case.
> Except 40€ a month is extremely poor value for this CPU that's more than a decade old.<p>This is a rather baffling opinion to have. All cloud providers charge far more for a virtualized instance running on God knows what hardware. You are faced with a deal where you can run your software on bare metal, and you complain about... About what exactly?
1) this reads like it's posted by an LLM<p>2) why could they not just up the prices for new deployments, like they did with their dedicated servers? I think that would be fairer to existing customers<p>If you have a company, I can recommend leaseweb for cheap hosting. I host my personal stuff like my email and my ente.io instance there. They are cheaper than Hetzner (already before the new price increase) if you don't need managed k8s.
Excuse me, but if the difference between 10 EUR per month and 14 eur per month is going to kill your startup, you probably shouldn't try to start it.
Might be time to think about using and creating less memory-hungry software.
Actually I disagree. I've killed projects because I've run out of time for them and didn't like them costing me £50 a month. If I'd been able to keep them going at £10 a month, I might have kept them going until I could get back to them. Sometimes startups fail just because the owners get distracted by life, and the project just needs more time.
On the plus siide, we all get to learn how few new computers are needed rather than chase number goes up.
Hetzner should not be compared to AWS or GCP for pricing. It should be compared to Vultr, Linode or DigitalOcean.
> Same kit I bought 8 months ago for 90 EUR is now 400+. That's not normal market dynamics.<p>That's exactly normal market dynamics during acute shortage. Remember 2020 when filtering face masks went up in price 10-100x?
Warning: another bot - check their history.
The reason Hetzner was cheap was bad latency and Arbor.
> It's that AI companies are vacuuming up every DRAM chip on the planet and the rest of us get to pay the tax<p>European victim mentality !1!<p>/s
When I have looked on Newegg and on Amazon USA last month, I have seen even greater prices than here in Europe, by 30% to 40% greater, which is reversed from previous years, when computers and computer-related components were cheaper in USA than in Europe.<p>So I think that the victims are all the computer users of the entire world, with the exception of a negligible number of humans tied to the AI companies. Moreover, the US victims appear to be hit by the price hikes even more than in other countries, at least for now.
> <i>That's not normal market dynamics.</i><p>It is, in fact, normal market dynamics.
It's normal market dynamics for markets dominated by quasi-monopolies, which is why regulation should have prevented the existence of such markets.
A single company that never made a profit outbiding the entire world is normal?
Maybe not normal market dynamics, but typical human behavior: <a href="https://en.wikipedia.org/wiki/Vincent_Kosuga#Cornering_the_onion_market" rel="nofollow">https://en.wikipedia.org/wiki/Vincent_Kosuga#Cornering_the_o...</a>
> It's that AI companies are vacuuming up every DRAM chip on the planet and the rest of us get to pay the tax.<p>That’s a redefinition of the term “tax.” The supply of DRAM is constrained because capacity decisions were made years ago. And these AI companies highly value the DRAM so they’re willing to pay more. It’s not a “tax” on everyone else, it’s just supply and demand.
Man alive, stop being performatively dense. <i>Getting to pay "the tax"</i> in this context is just a colloquialism equating <i>getting to pay "the burden"</i>.
Everyone knows what they mean, it's obviously not a real "tax".
For some reason I didn't get an email from them about this, even though one of my VPSs is in Helsinki.<p>Anyway, let's all please pretend that Hetzner is now way overpriced if anyone asks about it. :P
The post seems to indicate this is just for VPSs, which doesn't seem true, the email I just received from Hetzner mentions price increases for dedicated servers too.<p>The ones I'm affected by seemingly:<p><pre><code> Product -> previous price -> New price as of 1 April 2026
EX42-NVMe (FSN1) -> € 49.65 -> € 51.13
AX41 (FSN1) -> € 49.73 -> € 51.22
AX41-NVMe (FSN1) -> € 49.73 -> € 51.18
Server Auction -> € 65.22 -> € 67.18
</code></pre>
Still cheap compared to the performance + unmetered bandwidth, so I'm personally not super upset about it, my monthly bill in total goes up maybe 40-50 EUR in total, not that outrageous.<p>Here is the full list of the updated prices: <a href="https://docs.hetzner.com/general/infrastructure-and-availability/price-adjustment/" rel="nofollow">https://docs.hetzner.com/general/infrastructure-and-availabi...</a><p>Seems it's because of increased cost of hardware, and they seemingly tried to avoid increasing the prices but they couldn't. From the email:<p>> The underlying causes of the increased costs are, among others, the exploding demand for AI-related computing power and for cloud services. In addition, raw material prices and production costs have also generally risen for manufacturers. The costs for RAM and SSDs especially have risen by a large amount. For example, the cost for DRAM memory has increased up to 500% since September 2025. And according to market researchers like TrendForce, this price trend will continue throughout the year.<p>> We have genuinely tried hard to optimize our costs and to prevent increasing our prices for as long as possible. But we can no longer compensate for the strain that it has placed on our operations. We want to continue to deliver quality products that meet both our standards and your expectations, so we must take this step.
I'm not particularly tied to Hetzner as an American using their Ashburn servers, so I figured maybe this price increase puts them a little closer to DigitalOcean's pricing. The pricing is still pretty heavily in Hetzner's favor though: the CCX23s that I use will be $39.99 USD after April 1, but the closest DO equivalent is $126 USD with a third of the disk space.
A significant part of this is probably just the hockey-stick growth in the price of memory we have seen in the past 6 months. Would be surprised if this wasn't impacting their bottom line for maintenance.
RAM increased the most, but also SSD and HDD prices increased significantly. And it seems there are also supply problems, so you can't even be sure if you get the components you want at higher prices.
There is another factor at play here: EU hosting providers that are not owned lock, stock & barrel are few and far between and Hetzner has a very nice sales representative in the White House.
Yeah, also Hetzner is smart enough to realize that a lot of people are moving to them who are "Buy EU"-driven and are less price sensitive (certainly the most valuable ones are). Hopefully they can take these higher prices and further invest into the platform.
Can you expound on that? I'm not sure I get what you're implying.
Pretty sure they are implying that the actions of the current president/administration are causing people to re-evaluate US dependencies. I don't really understand the first half
I think in the first part they are implying that there are very few independent companies to turn to.<p>(I also prefer comments that are clear without insinuations).
Ahh, the sales rep is Trump, that makes sense, thank you. I thought Jacques meant they had lobbyists somehow.
1. There's no meaningful European competition.<p>2. Trump is making everyone scared to use US hosting.<p>So they're leveraging for extra profits.
That the USA is no longer seen as a stable partner for the long term and that Trump with his idiotic policies and tariffs is driving sales for the few EU hosting scale-ups that are not somehow owned by America.
That Trump makes us very motivated to stop relying on American tech.
The strongest reaction of EU would be to subsidize RIPE small LIR fees to 0€ and embrace decentralization.
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Here's to hoping the IOU purchase orders for RAM and SSDs get cancelled... Though I think folks are hedging that this will happen and limiting new suppliers.
It seems we will run out of hardware by March?<p>"Hard drives already sold out for this year" - <a href="https://www.theregister.com/2026/02/20/ai_blamed_again_as_hard_drives_sell_out/" rel="nofollow">https://www.theregister.com/2026/02/20/ai_blamed_again_as_ha...</a><p>Time for an AI tax on the hyperscalers.
> It seems we will run out of hardware by March?<p>What happens when an unstoppable force (building everything in Electron because hardware is cheap) meets an immovable object (oh no hardware is expensive now)?
We go back to the demoscene days, being creative with what we have instead of shipping Electron junk.
Maybe we need to let go of our auto-scaled 100 pod service mesh for a todo list app, and just deploy it bare metal on 2 servers.
consumer RAM is not what's creating shortage. Data centers doesn't run electron to train the model or for inference
Sure, consumer ram isn't causing a shortage, but it's affected by the shortage.
Every RAM producer is stopping their consumer grade RAM production to provide ECC-RAM and VRAM now. Micron <i>discontinued and closed down</i> Crucial brand as a whole.<p>So, getting systems with higher RAM capacity is getting harder (from laptops to smartphones). So, for a couple of years, we need to stop using Electron so much and use what we have efficiently.<p>Data centers, esp. AI hyperscalers do not care about efficiency for now, because they can suffocate consumer-grade part of the hardware marketplace and get anything and everything they want. When their bubble pops, or the whole capacity ends, they need to learn to be efficient, too.<p>For reference, a well-optimized cluster runs at ~90% efficiency even though they have thousands of users. AI hyperscalers are not there. Maybe 60% efficient, at most. They waste a lot of resources to keep their momentum.
They effectively do. They’re trained by brute forcing 100TB of training data through them, rather than any logical learning technique.<p>A human doesn’t need 100TB of books to learn the alphabet.
I guess we have to get creative again.
Stop using Electron to save massive amounts of RAM.
2026 will be the year of Rust...
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> Time for an AI tax on the hyperscalers.<p>Like the purchase price + increased cost? The thing is that these parties are sitting on billions and billions of investor money, they don't care that hardware is 400x as expensive. Which companies like nvidia have capitalized on a few years ago, they were already able to price their hardware at a 400% markup compared to pre-crypto times, and shift their focus from consumer graphics chips to datacenter compute chips, causing their revenue to go up 6x (if my interpretation of [0] is correct)<p>[0] <a href="https://www.macrotrends.net/stocks/charts/NVDA/nvidia/revenue" rel="nofollow">https://www.macrotrends.net/stocks/charts/NVDA/nvidia/revenu...</a>
Reads a bit like the Paperclip Maximizer appearing way ahead of schedule? Implemented not as AI, but as emergent behavior in the ways of the financial class (that happens to be about AI, singularity and all that).
Why tax something that the market will figure out? This is normal and things will sort themself out.
Markets only "figure things out" in a petri dish economy where:<p>1) There are no barriers to entry for competitors (e.g. protectionist tariffs, equal access to capital for everyone)<p>2) There are perfect substitutes available, so transitioning to a competitor is seamless and free (e.g. no requirement to store data in Country X, no vendor lock-in, no security compliance)<p>3) The industry is not a "natural monopoly" when only a handful of vendors can operate due to capital investment and national/global distribution required (see power utilities, telecoms, petrochemicals)<p>4) Profitability attracts competitors (won't happen because of #3), but heavy competition prevents abnormal profits from accumulating to a single player (happens because of #1, #2 and #3)<p>When markets don't figure things out, as is the case around the world, you get a tangled mess of market failures, government intervention and lobbying to neuter proposed interventions.
Markets are never perfect but over the course of history they are a pretty good mechanism to solve these type of problems. Not sure why we think taxing hyperscalers differently is the answer. Government usually does worse than the market when it comes to sorting it out.<p>My argument is not that market is perfect but that the alternatives are probably far worse, like a new tax on a specific group of companies.
We see that market is very irrational now and it can stay irrational for long enough to destroy everything we know in tech.<p>By the time market figures things out, you may no longer have services, and hardware that you use daily. When such amounts of stupid money are pumped into a single industry, even if all AI companies went out of business tomorrow, it's going to take years for things to go back to normal.<p>FWIW, I'm not advocating taxes, as I think that won't really do anything. I don't know what the solution is either.
> ...and it can stay irrational for long enough to destroy everything we know in tech.<p>Nah. For decades software engineers have been more expensive than the cost of buying the extra hardware needed for vastly inefficient software. There are orders of magnitude of inefficiency there. So there's a ton of slack in the world's software that can be taken up by software engineers while hardware is scarce, pushing back the date where there will really be a problem probably by decades more.<p>Of course software engineers will see a problem though, because they'll have to learn to to write efficient software again.<p>ie. "Great, but now make it work with less RAM" will be a thing again, instead of "It needs more RAM so order some as it's cheaper than your time to fix the code".
Sounds like hyperbole. Yes the world is connected yes we are seeing shortages, yes the market is imperfect and it lags but this is how things get fixed. Prices are sorted out, manufacturers make bets on long term capacity. Some will be losers, some will be winners.
My guess is that many of the current people saying "technology is over and no one will afford their own computer" might have been born after the previous shortages, so it's in reality their first shortage and they have no memories (nor interest reading about) the previous ones, that all eventually washed over, even if at those points there were also people claiming that "No one will have their own SSD in the future, because prices will always be super expensive for consumers from now on".<p>That's my hypothesis I spent a whole of 30 seconds thinking about anyways.
This is a different kind of shortage though. Previous ones were cyclical and caused by supply/demand mismatches or natural disasters. This one is structural. The manufacturers are actively choosing to prioritize AI because the margins are dramatically higher, and AI market has virtually unlimited money right now.<p>> eventually washed over<p>Eventually is doing a lot of heavy lifting here. Several years of constrained supply have real consequences for people and businesses. Hardware manufacturers are saying most of their capacity is already sold out to AI customers through 2026, and possibly even through 2027 and 2028, with the rest of the markets getting what's left over. This is a fundamentally different market dynamic.
> caused by supply/demand mismatches<p>How is that different from today? The scale might be different, but it's quite literally a "supply/demand mismatch" right now.<p>I don't think what we're seeing today can be described as "structural", at least because it's way too short to make such proclamations today, if it ossifies, then yeah maybe I'd agree with you, it's become structural.<p>> Several years of constrained supply have real consequences for people and businesses<p>Indeed, but lets see if it'll go as far as being "several years", the prices already stopped increasing, and supply still isn't planned to be expanded, if either of those changes you might have a point, but as of today it seems like an exaggeration.
Market <i>is</i> fixing it. Memory makers prioritized HBM and enterprise NAND, some, like Crucial, went out of consumer business entirely.<p>At the same time, the rational market <i>is</i> behaving rationally - they're not increasing production because they're fearing AI bubble could burst, leaving them with oversupply and expensive factories.<p>The market, apart from AI market, is behaving exactly as it's designed and as it should. But it doesn't mean outcome is good for everyone.
> We see that market is very irrational now and it can stay irrational<p>That meme refers to speculation on stock market prices. Nobody is buying up RAM with the expectation of making speculative gains on it.
> it can stay irrational for long enough to destroy everything we know in tech<p>What does this even mean? I know people on the internet sometimes exaggerate, but I cannot even begin to find a more charitable meaning with this, what exactly will be "destroyed" in "tech" because of prices going up for a year or two?
Here's an easy experiment to conduct: look around the room at your home and count all the devices that have a CPU, RAM, SSD or HDD.<p>Then take a look at your bank statement to see what are the services you pay for monthly that also require the same hardware.<p>Now, imagine that these devices or services can no longer procure RAM, SSD or HDD. There's no more available supply for these components, because this is what's happening.<p>Would you still be able to have these devices if they all broke tomorrow? What about your hypothetical Backblaze subscription? Would you still be able to have an off-site backup?
> imagine that these devices or services can no longer procure RAM, SSD or HDD<p>Why would I imagine something so far out from what will realistically happen?<p>Again, a lot of doom and gloom over very unrealistic scenarios. Where are you even getting this from, YouTube channels?<p>Of course if there is no RAM or flash-storage at all available, eventually hardware will be unfeasible. But when we've experienced these sort of things before, it eventually restores to "normal" prices, and there absolutely nothing pointing to what we're experiencing now to get even worse, if anything it's already stabilized.
Valve had to delay a bunch of new products already. They also had to effectively discontinue the non-OLED Steam Deck due to the increased prices.<p><a href="https://www.theverge.com/games/874196/valve-steam-machine-frame-controller-delay-pricing-memory-crisis" rel="nofollow">https://www.theverge.com/games/874196/valve-steam-machine-fr...</a>
Yeah, which shows that Valve don't think "these devices or services can no longer procure RAM, SSD or HDD" is actually what'll happen in reality, because then they'd have to cancel the hardware fully. Instead, they're delaying it.
You don't have to look too far back in history -- look at the supply squeeze during covid, or even just during the Suez closure by the Evergiven.
Yet here we are. Markets kept growing, some companies lost during the supply crunch but hopefully we came out generally stronger. So again the doom and gloom is hard to track. Maybe we hit a couple years of different supply crunches in tech, at some point if demand sustains companies will figure it out, optimize price, manufacturing lines etc.
My laptop's 8 years old, if I can't get memory I'll just have to sweat it a little longer. Same with my NAS drive<p>Same with work -- I've just ordered some replacements for 13 year old servers in one office, but if it was more economical to repair them
What we're seeing is the natural conclusion of VC distortion in a market. There is so much money being pumped into AI speculatively now that it's hurting normal and sustainable businesses in other parts of the economy.<p>The solution might have to be mandatory rationing of some kind to avoid a situation where only a handful of AI giants are able to buy essential components. We can't just throw the rest of the economy under a bus to support the AI bubble for a few more months.<p>I'm working with a business right now that would like to buy some new servers for sensible, boring business reasons. It is having trouble because the prices from their normal suppliers are now extremely high - if the components are even available at all. This business has nothing to do with AI or Big Tech and yet it's at risk of being unable to continue normal operations in much the same way that a business would be affected if the phone networks were all switched off or the water supply to its office was cut. We regulate those industries because their continued reasonable operation is essential to make sure everyone else can continue to operate reasonably as well.
I'm seeing the same thing. I was consulting a group of people in my city that wanted to digitize massive load of old VHS tapes. No AI, no crazy tech, just standard, boring storage+network infrastructure.<p>I'm looking at the procurement sheet that I made for them a year ago. Half of the items are no longer available, while the other half became so expensive that we'd probably build 10 of such labs with these costs a year ago.<p>I'm also looking at my home NAS right now - I pray not even a plastic clip breaks inside, because I'd have to shut it down.<p>While these are still likely the first things that you'd think of being affected, I'm sure the effects are rippling through essentially every industry that utilizes these components in their supply chain. Which is probably - every industry nowadays?
I think that’s a massive stretch. What we are seeing is a new frontier in tech that nobody knows where it will land yet. Hyperscalers see a future where if they don’t build now that they might be left behind.<p>Absolutely VC money is flowing around but I think it’s unclear where the cards fall yet.<p>Not sure what you would regulate here. I hate the tripe that America and China are at war but I do think it’s not a great decision to stop the current work the west is doing as China is pushing full steam ahead.
I wish this comment can be on the absolute top of this page. This really is one of my frustrations with the AI bubble.<p>Fwiw, the days of creating an good ol' reliable hosting provider/Vps provider are over. I looked extensively into it one time out of curiosity but this would be one of the worst times in history to do that.<p>We would be sort of stuck with the options that we have right now and more and more shops in Lowend are even shutting down or raising prices with the sheer ram crisis and even HDD and storage crisis now.<p>A provider in LET had a post which said, "what should we providers do to deal with the ram shortage/ram prices"<p>These providers gave competition/had different unique features too to have chosen them but they were also incredibly price sensitive and the AI bubble blew the sensitivity by raising the prices almost 5 times or more. This would impact real businesses.<p>Thank you for creating this comment. I hope more people can read this. I genuinely just want this bubble to burst asap so that we can see a sense of rationality back within the market/the market functioning as expected without the immense irrationality/unpredictability of future.<p>another point is this, from my hosting provider idea, I shut it down. Why? because it literally makes 0 sense to start now, its postponed indefinitely untill the bubble bursts/ram prices are decreased.<p>How many other projects might be going through something similar. Gck1's comment next to mine also gives an example of a project whose value of cost increased 10 times.<p>How many of such projects would simply be unable to be built because of the ram inflation can't be underestimated imo.<p>and forget people who wish to game and many other things too. Basic comodities in the previous year or two feel like luxury now. All because of AI. It's insane.
They didn’t the last two memory crunches. Litigative action figured it out first.
Because this perfect version of capitalism you think exists, doesn't.<p>We live in a world with markets dominated by cartels of tech companies who don't play by the rules. Every other industry that impacts society in a negative way typically pays some sort of specialized tax to offset that, I don't know why these tech oligarchs shouldn't have too. It's wild how people just want to let them do whatever they want.<p>Everyone says we need to deregulate tech, and certain industries to get ahead of China.. Isn't it funny how their largely government controlled economy (to a degree) is annihilating the west on all fronts economically. We need far more regulation.<p>China will defeat the West solely because it regulates its billionaires, not the other way around like we have it in the West. And I hope so, the world is rooting for you China.
Way to put words in people mouths. Markets are imperfect but I do believe on average they are one of the better tools to solve supply and demand issues.<p>I don’t know who will come out winners but I do agree that China did well taking the playbook from Singapore and navigating their country through incredible amounts of growth. They are still facing depressing housing prices and deflation in other parts of the economy.<p>There are absolutely areas where markets breakdown, thinking problems where impacts are on longer horizons but for simple supply and demand like what we are seeing today, things will sort out in a couple years.
These changes are effective April 1st for existing and new customers. The price increase ratios are also different across product lines.<p>* Cloud (VMs): 38%<p>* Bare metal: 15%<p>* Memory add-on for bare metal: 575% (effective immediately)<p>It feels like memory add-on is intentionally set high to discourage customers from adding more memory.<p>AX102 (128 GB RAM) costs €124, AX162 (256 GB RAM) costs €244, but the 128 GB memory add-on alone costs €264. If we ignore the setup fee, it’s more cost-effective to provision additional servers instead of adding RAM to bare metal instances.<p>Here's the link to cloud and bare metal pricing changes: <a href="https://docs.hetzner.com/general/infrastructure-and-availability/price-adjustment/" rel="nofollow">https://docs.hetzner.com/general/infrastructure-and-availabi...</a>
> * Memory add-on for bare metal: 575% (effective immediately)<p>> It feels like memory add-on is intentionally set very high to discourage customers from adding more memory.<p>Memory prices are so stupid now that 575% is pretty close to their actual costs.<p><a href="https://pcpartpicker.com/trends/price/memory/" rel="nofollow">https://pcpartpicker.com/trends/price/memory/</a><p>DDR5-6000 2x32GB: ~$200 -> ~$1000
Have you seen the price of RAM recently?
AFAIK, it's been stabilizing lately at the current price, so at least it's not increasing anymore: <a href="https://pcpartpicker.com/trends/price/memory/" rel="nofollow">https://pcpartpicker.com/trends/price/memory/</a><p>By the same time next year the prices likely gone down, although maybe not to the pre-increase, but surely much lower than currently. Putting it in my calendar to revisit this comment in a year :)
> * Memory add-on for bare metal: 575% (effective immediately)<p>I don’t see this anywhere, source?
I used Hetzner's pricing calculator.<p><a href="https://www.hetzner.com/dedicated-rootserver/ax162-r/configurator/#/" rel="nofollow">https://www.hetzner.com/dedicated-rootserver/ax162-r/configu...</a><p>Before today, we used to be able to order an AX162-R for €207 and add 128 GB of RAM for €46. Starting today, the same calculator provides €207 for an AX162-R (*) and €264 for the 128 GB RAM add-on. Sadly, HN doesn't let me upload screenshots.<p>(*) The price change for AX162-R machines is effective starting April 1st.
Yeah, not sure where they're getting those from.<p>From the Robot UI, I tried ordering a new EX44 or EX63:<p>- EX63 comes with 64 GB DDR5 by default, can be upgraded to 192 GB DDR5 ECC for added €42.35<p>- EX44 comes with 64 GB by default, can be upgraded to 128 GB DDR4 Non-ECC for added € 16.94 max. per month
> These changes are effective April 1st for existing and new customers.<p>Checking today doesn't really indicate anything.<p>It's worth noting that the hardware price of RAM is up at least 550% yoy, so this was always going to happen as soon as their existing contracts had to be renewed
This was already discussed, but that post got dumped onto page 5 after just a couple of hours for some reason.<p><a href="https://news.ycombinator.com/item?id=47120145">https://news.ycombinator.com/item?id=47120145</a>
Good. This means the market is healthy.<p>Hopefully this also means new providers appear in Europe, to handle the increase in demand.
I really love that their notification email includes applicable price change for my specific servers.<p>The worst counter example of this was Mercedes sending me an email saying "the terms and conditions have been updated, please read them at this link". It linked to the 52 page document I was supposed to read through in its entirety and manually diff against previous! Good thing they started adding a change log in the emails after some customer push back.
I just bought a Raspberry Pi 4 1 GB memory with aluminum case, aluminum NVME adapter, and a 64 GB SSD for about 80 euros. With microsd it’s even cheaper. 4 GB RAM would be about 120 euros.<p>The 1 GB RAM replaces one Forgejo runner that was in Hetzner. With €5 per month, I will earn this investment back in less than two years. After the price increase, this period will only shorten!<p>I also wrote about this at <a href="https://huijzer.xyz/posts/148/raspberry-pi-as-forgejo-runner" rel="nofollow">https://huijzer.xyz/posts/148/raspberry-pi-as-forgejo-runner</a>
Still cheaper than US cloud computing.<p>In EU there are: Hetzner, OVH and Seeweb.
Doesn't seem to apply to older/deprecated gen instances. I've got a CX22 there for personal screw-around projects and it's the same £3.95/mo (pre-VAT) afaict. So maybe not much help to folks ordering new or running on the current gen as the older kit isn't something you can order now, but a small boon for us laggards.
companies that haven't turned a profit are outbidding the rest of the economy for hardware. that's not a supply shortage, it's a subsidy funded by venture capital.
I am confused why the announcement page says CCX33 in USA "Old price" is €59.49 but their main pricing page shows €50.49 for CCX33 in USA<p>Announcement page:
<a href="http://docs.hetzner.com/de/general/infrastructure-and-availability/price-adjustment/" rel="nofollow">http://docs.hetzner.com/de/general/infrastructure-and-availa...</a><p>Pricing page:
<a href="https://www.hetzner.com/cloud/" rel="nofollow">https://www.hetzner.com/cloud/</a>
Hetzner had the best prices out of any cloud I’ve used. Sad to see that they are raising prices, but was due to happen.
Western memory manufacturers decided to chase the AI bubble, abandoning the consumer and low-requirement markets entirely.<p>Chinese manufacturers are now capturing that entire segment with full vertical integration. When this bubble stabilizes, because it will (it's not going to grow to infinite), Western companies won't recapture those markets.<p>They've already ceded competitive advantage for the next decade. This is a structural shift, not a cyclical shortage.<p>It's another step in the transformation of Western industry that began in the '80s: the shift from real economy and human-centric production to financialized operations.
Somewhat weirdly I’m very happy about this price increase as a customer. The messaging is clear and completely understandable. Well done.
They're using Arbor, they were cheap for that exact reason.<p>Now that people don't care about Anti DDoS - this happens.<p>In the past everyone was leaving Hetzner for the OVH/Voxility due to terrible latency and nonexistent protection.
If you just want an app server pick up an hp elitedesk off ebay and a ups and run it on your home inet connection.
Note: your ISP might cut your account, and this might violate your home insurance contract — depending on jurisdiction.<p>At least where I live there’s a stupid amount of red tape for these things.
I've just been looking in to this as I've got quite a lot of older hardware that'll be fine for running some websites lying around.<p>My ISP has a static IP option for £5/month, but I reckon I can save £30/month+ on server costs even before any rises.<p>Ofc it does mean I have to do my own sysadmining, but a combination of my general knowledge + an LLM should make that relatively easy.
IF you just want a Pizza, pour some tomato ketchup on sliced bread.<p>If you just want to pilot a 747, drive your car really fast at a skate ramp.
36% as per the linked post, 38% was a typo.
Still a fraction of the cost of most other providers, and wouldn't shock me if we see the others all doing something similar.
This comes after OVH sent emails with really spicy increases too. Like north of 50
I haven't received this email, and I have one x64 server that costs around 4 EUR/mo, and an ARM server that costs about 6 EUR/mo. I wonder if I'll still be affected by the price increase.
I moved from paying 24.50 a month to 25.39 a month for my little VPS plus storagebox.<p>CPX31 Cloud Server (Germany): €13.10 → €13.99/month (+€0.89, ~+6.8%)
BX21 Storage Box: Unchanged
Primary IPv4: Stays at €0.50/month
On one hand this is not good but predictable. I'm on longer-term commitments with OVH, so it will be interesting to see how they follow. I'm still keeping Hetzner on my shopping list, even with the increase the bare-metal offerings are within my budget, and now that prices have increases they should be stable for a while (also import for budget management).
My CCX13 (dedicated cores) went from 15€ to 20€ now. Looking at Netcup as alternative, more cores and more RAM for 12€ - anybody has experience with their root (kvm'ed) servers?
They've only ever increased the ipv4 prices for already existing customers before if I am not mistaken. This is quite big.<p>EDIT: It's not a huge increase for dedicated servers. I already can't find anything comparable for more than the increased end price.<p>> AX51 (FSN1) € 63.10 € 64.99<p>> AX101 (FSN1) € 107.10 € 110.31
> They've only ever increased the ipv4 prices for already existing customers before if I am not mistaken<p>No, that's not true, they've done increases before, at least for VPSes only, I think that was 1 or 2 years ago or so?
You might be right. Sorry. I should have said they haven't increased prices for existing dedicated servers since my direct experince is only there. Actually until about 3-4 years ago when the whole world went to shit, using a server for a year or two then upgrading to a better server for cheaper, was the norm. In that environment, you would naturally not have price increases.
I also don't think you're right that it never happened for the dedicated servers :) I'm only using Hetzner for dedicated servers, and found an email from 2022 where they mention price updates:<p>> Unfortunately, we are forced to increase the prices on these Server Auction models [...] old price 37.60 Euro -> 59.29 Euro, comes into effect 2022-03-03<p>Citing raising energy prices at that time.
This mirrors the increased costs of people who already space + power in a DC, and want to buy new machines to fill their racks. Everybody is being hit.
This is likely just the first wave. If this component hoarding by AI continues, and it likely will, at some point, it will be just OpenAI and Anthropic who can afford to have compute.<p>This has affected SSDs first, then RAM, then HDD and it doesn't look like even HDD manufacturers are going to increase production. So unless groups of people suddenly learn how to manufacture all of this hardware and open factories quickly, it's going to be a very fun next few years.<p>People have been predicting SaaS will die for all the wrong reasons. It's not that anyone can ship a SaaS clone by prompting an AI, it's that nobody is going to have access to the hardware required.
With the recent price spikes in memory and storage, this was just a matter of time.
Wow. That sucks. hcloud was great for ages and highly competitively priced.<p>Vultr may be a good alternative. If you want to search VPS prices across the 6 major clouds (gcloud, aws-cli, hcloud, az, doctl, and vultr-cli) I made a wrapper TUI that lets you search, sort, and rent VPS.<p>See it here: <a href="https://tui.bluedot.ink" rel="nofollow">https://tui.bluedot.ink</a>
I would be very surprised if all hosting providers didn’t increase their prices eventually.
This is it. Hetzner has always been very price competitive in its existence. Given the private ownership, I din‘t expect this to be a sudden outburst of greed, but to actually reflect rising costs.<p>If a provider has higher margins, they may choose to eat some of the cost. But I would not expect that to be the case across the board
> Vultr may be a good alternative<p>I feel like a huge selling point of Hetzner is that they're based in Europe, and they're themselves citing that as the reason for a huge uptick in sales and new users. In that context, I don't Vultr is a realistic alternative.
This will be as a shockwave in web hosting industry, the same as it was with electricity price. There is nowhere to run. Everyone will increase their prices, unless hardware crysis ends up.
Even my more then 11 years old server increases by 80 Eurocent! Dare you!
How much is the cost for Storage Boxes increasing?
[dupe] Discussion on source: <a href="https://news.ycombinator.com/item?id=47120145">https://news.ycombinator.com/item?id=47120145</a>
Surely that means that as soon as prices of ram drop, Hetzner will also drop the prices, right? RIGHT?
Hezner reducing prices is not unprecedented. I think RAM chips getting cheaper is a less likely event than Hetzner responding with dropping prices
At best they would freeze prices for a few years which would be a real term decrease
My increases were around 4%
I recommend Netcup as a solid EU budget alternative to Hetzner, zero complaints from me.
They are solid and cheaper, but they don't offer the same level of control plane and API access as Hetzner that is really helpful when managing a larger number of servers.
Their ARM64 boxes are fantastic, but sold out at the moment.
"<i>Edit: It's 36% ! Can't edit the title typo of 38%</i>"
Ouch. OVH are also going to increase their prices.
... more customers so they must increase prices? This seems backwards from how scale usually works.
It is, but more customers <i>at a time of historically high component prices</i> will do it. If you set your costs assuming every user's hardware is $1, and your customer base doubles when the hardware is $2, you're going to have to raise prices for everybody
The next set of hardware purchases will cost more than their last set of hardware purchases, and that's going to outweigh any labour economies of scale given just how many hardware components are in shortage this year.<p>If their growth had been in their projections in say 2024, they might have just been able to skip a round of hardware purchases, but the combination of growth meaning they must expand their hardware and hardware costs made this inevitable.
Can anybody predict this craze? The classical memory manufacturers are not yet adding additional manufacturing capacity. They learned this hard way in the past. That means, the demand is here to stay for years without typical bubble burst. Is this a point where Chinese companies will rise worldwide?
The massive DC overbuild matches demand, prices normalise somewhat in 3-5 years.<p>The massive DC overbuild does not match demand, prices tank in 3-5 years.<p>Third possibility: some approach like Taalas renders the current storyline meaningless. Would put 3 in 10 odds of this happening but I'd looove to see it.<p>Fourth: entire planet gets profoundly sick of emdashes, we all move back into caves and live in eternal gratitude of the moment humanity woke up to how little all of this really matters.
Hard to predict. If the bubble pops (NVIDIA and "circular economy", massive FAANG datacenter expansion plans, huge LLM training budgets) the markets will once again be flooded with components.<p>But, the shortages may very well continue into 2027, leading to some manufacturers going out of business and yet another massive redistribution of wealth.
Silver lining: can you imagine how <i>dirt cheap</i> RAM will be after that bubble has popped? Oh my...
Your home systems can slot in HBM? Doubt that.
It won't. Demand is being pushed forward. That means that longer this situation take longer it will take for prices to recover to same levels.
RAM producers aren't adding more capacity on the non-HBM side of things, so we shouldn't see a dramatic drop in pricing if AI HBM memory demand drops.
No manufacturer is increasing supply though. RAM, SSD, HDD - they just reallocated their existing supply to AI.
This is a simplistic view of why the prices are the way they are.
... and still remain far too cost-effective. Frankly this says more about the rest of the industry than for hetzner
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BuyFromEU is the funniest subreddit there is right now. Unintentionally but still entertaining. EU has managed to paint itself into unenviable corner. I can't buy from EU even thought I want to because for physical goods - cross country shipping costs are prohibitive and for digital - they are either subpar, more expensive or both.<p>Try this as experiment - try to buy something like precision dowel pins from Poland or DOLD Mechatronik with shipping to Greece, Bulgaria or Romania vs the same thing from Aliexpress or Temu. Chinese costs are cheaper even if they have to fly here.
QC / Cheap Shipping / TEMU or AliX Pricing<p>Pick 2.<p>Not to mention that from July 1, 2026, the EU is abolishing the €150 duty-free threshold for non-EU shipments. This is specifically targeted at the flood of packages from marketplaces like Temu and Shein.<p>From July there will be a flat customs duty of €3 for small consignments. This fee applies per category. If your package contains items from different product groups (e.g., a shirt and a cable), you might pay the fee multiple times.<p>The Goal: To create fair competition for European retailers who can't compete with subsidized shipping and tax loopholes from massive non-EU sellers.<p>This will obviously have a knock-on effect for larger shipped items which are presumably subsidised at the bottom line by these parcels of fast-fashion and eWaste.
As someone that frequently buys low-cost second hand electronics from Japan, I am a little frustrated about the €3 per-category customs duty. That means a €80 package of various old game cartridges, retro handhelds, digital watches and collectables will now have another €12 to €24 on top of the 21% VAT and €6 handling fee. For an €80 package I am now looking at €15 for shipping and €34 to €46 in import cost. That kills a fun hobby.
>Try this as experiment - try to buy something like precision dowel pins from Poland or DOLD Mechatronik with shipping to Greece, Bulgaria or Romania vs the same thing from Aliexpress or Temu. Chinese costs are cheaper even if they have to fly here.<p>This is an <i>awful</i> experiment. Only consumers care about delivery costs on deliveries like these, and what you're looking at are explicitly not goods aimed at consumers.