DO, Vultr, AWS, GCP, Azure are the odd ones out and extremely expensive.
The only reason ever not to use dedicated servers is if you're in the bay area and ops wages are so overinflated that you literally can't afford an ops or devops person.
For everyone else on the planet, the comparison between the wage of an ops person, and server costs, is always in favor of dedicated hardware with your own ops people.
“If this doesn’t take off, I’m on the hook for ~$100/month when it could have been under $10/month“ just isn’t that compelling.
It's something worth optimizing, but the idea that it will break a starting initiative isn't realistic.
I can deploy my SaaS either to VPS servers (AWS, DigitalOcean, Azure, etc) or to physical servers. Both deployments use the same ansible automation. The only difference is that I additionally use terraform to set up the cloud instances.
In every case, if a machine fails it is my problem.
Where is the savings on ops/devops?
I don't know either, I've always used european dedicated hosters.
But apparently the typical YC user needs to pay 300'000$/year for a dedicated ops person just to run an ansible script?
Also, with vpncloud I know that my data gets encrypted and is private — not necessarily the case with various VLAN setups.
I don't know why Hetzner dedicated servers are so cheap (they're also cheaper than their equivalent VPS's). I guess they take a bit longer to set up but there must be more to it than that.
You also don’t get the benefits of a virtualized instance like live migration for host maintenance. You can run your own hypervisor - but you’ll probably want extra hardware like 10Gb switches and the appropriate cross connects and as well as paying the one-time server move fee.
Are you sure? If I look at the AX dedicated server page, I can read that the basic support is free:
"Basic support includes the free replacement of defective hardware and the renewed loading of the basic system (in so far as a disk image system can be loaded)."
Add this cron job:
yum -y update
At minimum you need a data replication and backup strategy. You're exposed to things like drive and RAM failures on dedicated hosts, so you'd need to think about RAID at least, unless you're running a system that clusters at a higher level (but then you need multiple machines).
However this is basically a matter of learning or hiring/renting a sysadmin to do it for you.
MTBF stats for different classes of hardware at different hosts would be valuable to have, as it can be affected by things like datacenter temperature. But I never heard of such a dataset.
The question should be, why is AWS so expensive on all fronts (not just the hardware but also bandwidth)? And the answer is again because the market lets them get away with it.
A large part of the cost of a VM on these clouds is paying their super high employee comp, for advanced software development e.g. CosmosDB/DynamoDB, but most of all, contributing to the high revenue growth that drives stock prices.
It's not paying for the actual cost of hardware. Smart people know this and don't run in the cloud unless they get a sweetheart deal. Consider that GitHub, for example, runs/ran in their own datacenter and used the cloud only for spillover capacity. Zoom also (although now Oracle cut them a sweetheart deal). Netflix built their own CDN etc.