OVH is increasing the prices of its servers, some by as much as 87%, for both new and existing customers, blaming AI’s insatiable demand driving the rising cost of the RAM and storage it uses in its data centers.
The European cloud operator specializes in low-cost bare metal and public cloud offerings.
CIOs will be familiar with the balancing act OVH has had to perform over the last year. In a Monday post explaining the upcoming increases, OVH chairman Octave Klaba wrote on X, “We have to place the right volume of orders, month by month, over 12 months, with no guarantee of the purchase price and without knowing what will be the real demand from our customers.”
Still, he added, “even though our prices are increasing, we remain the cheapest on the market for bare metal and public cloud; where before we could be 3x cheaper, we will be 2x cheaper (if our competitors don’t increase their prices).”
The increases will hurt hard-core gamers hardest, with the cost of the company’s most recent gaming servers rising 87%. (Older gaming instances are unaffected.)
But enterprises will also feel the pain from climbing component costs: OVH’s latest High Grade bare metal servers, with up to 2 x 96 cores of AMD Epyc 9005 series processors, 36 hard disks per server, and high-density cooling systems, will go up in price by 59%; older models built to the 2024 spec will go up 26%.
Lower-performance servers will also see increases of 40%-49% for the most recent models, and 26%-37% for older models.
The new prices take effect from Sept. 1 for new orders, and from Oct. 1 for renewals.
It’s not just baseline server prices that are increasing; optional additional memory and storage are going up in price too. OVH already increased the cost of these extras for new server orders as of July 1, with RAM prices rising 127% and disks 89%. From Oct. 1, renewals will be affected too, with the price of additional RAM in the latest servers rising by 40%, and that of larger disks by 15%. For servers built to 2024 specs, the increases will be 20% and 10% respectively.
Existing customers can lock in current prices for servers already in production for up to four years if they pay in advance by Oct. 1, Klaba wrote. Existing commitments will not be affected by the increases until they are due for renewal.
The price rises are more nuanced when it comes to public cloud systems. In future, OVH will break out storage and IP address rental costs separately, and will allow customers to mix and match storage capacity and compute.
“In appearance, hourly compute cost won’t change,” Klaba wrote. “On the other hand, low-latency Block Storage and IPv4 addresses, previously included in our Gen3 instances (B3, C3, R3) will appear as two separately billed line items on Oct. 1.”
The result is price increases of as little as 1.4% for the most powerful instances, or as much as 21.9% for smaller instances, he said.
OVH will continue to offer a 15% discount for a commitment of one year, or 30% for three years, he said, but will no longer offer discounts for shorter terms.