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Hetzner cuts traffic on US VPSs, raises prices

news.ycombinator.com

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Re: Hetzner cuts traffic on US VPSs, raises prices

#41

Post by jsheard »

fabian2k wrote: post #30

Is traffic generally much more expensive in the US than in Germany? This seems to be a US-only change and I'm wondering a bit about the reasoning here and whether to expect this to also change in other regions.

Not really, CDNs with regional pricing usually charge almost if not exactly the same amount for NA and EU traffic. It's the other regions that tend to be more expensive.

I wonder if this has anything to do with how Hetzner operates in each region, they run their own EU datacenters but AFAIK they just rent rack space in the US, so they're more at the mercy of upstream providers.

Re: Hetzner cuts traffic on US VPSs, raises prices

#42

Post by summarity »

jpalomaki wrote: post #14

Am I calculating right that 20TB per month means around ~60Mbits per second for 24/7? Not a network expert, but it is hard to see how this could be sustainable for less than €5/month. Sounds a bit like the usual case where company is able to give a generous offering because most customers utilize just a small portion of it. Maybe with the attention they have been getting, they have attracted more bandwidth hungry cus…

That is what they (explicitly) said in the email: users using next to no bandwidth were offsetting the costs for the heaviest users. That was no longer sustainable.

Re: Hetzner cuts traffic on US VPSs, raises prices

#43

Post by omnimus »

machinekob wrote: post #25

So it seems that trying to compete with duopoly isn't working. Can we assume it is cause there is only few big corporations dominating internet infrastructure in US compared to EU with tons of medium sized and even small business that do it? I would love some good read about US infrastructure, especially why costs are so high compared to EU?

Seems like the companies in US trust AWS just in case and this too cheap german company is suspicious. I would take guess that those who actually use Hetzner in US use it solely to abuse the generous traffic and not care that much about compute. Where in EUrope many companies never jumped on AWS in the first place.

Re: Hetzner cuts traffic on US VPSs, raises prices

#47

Post by acdha »

stavros wrote: post #33
Slartie wrote: post #8

Did they finally realize how AWS/Azure/Gcloud actually generate their exorbitant profit margins?

No, they realized that nobody switches away from AWS because of their expensive bandwidth.

AWS negotiates on bandwidth, too, so I imagine the actual savings would be a lot smaller for most customers unless you have some business which is heavily dominated by egress pricing.

Re: Hetzner cuts traffic on US VPSs, raises prices

#49

Post by cuuupid »

stavros wrote: post #33
Slartie wrote: post #8

Did they finally realize how AWS/Azure/Gcloud actually generate their exorbitant profit margins?

No, they realized that nobody switches away from AWS because of their expensive bandwidth.

Bingo, lots of people are loud about this online and many influencers screaming about this on Twitter, so it’s easy to conflate that as a pressing issue. Ultimately a thousand indie devs mad about bandwidth extortion are still making up less than 1% of a serious company’s revenue for AWS.

I’ve liked using Hetzner before and I’m curious how they’ll go after the market now. This is probably the wrong move though; Cloudflare realized this same fact some time ago but they kept their prices low to avoid cultivating ill will.

Re: Hetzner cuts traffic on US VPSs, raises prices

#50

Post by acdha »

machinekob wrote: post #25

So it seems that trying to compete with duopoly isn't working. Can we assume it is cause there is only few big corporations dominating internet infrastructure in US compared to EU with tons of medium sized and even small business that do it? I would love some good read about US infrastructure, especially why costs are so high compared to EU?

AWS, Microsoft, and even Google provide a lot of features large enterprises want. A cheaper competitor which expects you to build more of that yourself entails larger staffing costs and that’s going to sound riskier if you aren’t great at consistently delivering software projects.
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