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Comment by dpeckett | Hacker News Reader

This is typical of Hetzner, if a product SKU is losing money they very quickly make changes, even going as far as to discontinue the product entirely (eg. GPU servers). They definitely don't seem to be a fan of loss leaders.

I'm guessing somehow the traffic usage patterns of their USA customers was very different to their EU counterparts, or the cost of expanding network capacity was a lot higher than anticipated.

It's a bit of a shock for sure but it seems this model is a big part of how they can maintain their slim margins.

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I have no complaints at all about this model. They work out the cost of providing a service, then they charge that cost plus a markup. They keep doing things that make them money. They stop doing things that don't make them money.

It seems like a straightforward way to run a business.

Yep they're the technology equivalent of a discount supermarket. Everything is commoditized to the extreme.

Breath of fresh air in the modern cloud era tbh.

I have one big complaint and one little one. The big complaint is that they didn't even give one business day's notice, and the little complaint is that they raised prices at the same time they cut what they were offering by 20x, instead of doing one at a time.

They're giving two business days' notice for new product and three months for existing product?

December 1st's change isn't just for new customers. It's for newly-created or rescaled servers belonging to existing customers too, and it's plausible that those operations might happen a lot for some customers. And Thanksgiving and Black Friday are holidays for almost all American tech workers, so I'm not counting them as business days.

Normally that would be ok, but considering the way many systems are setup to load balance and quickly spin up new servers and spin down un-needed servers on the fly, one business day would not give you enough time to revamp your system to work with a different provider.

The bandwidth market is very different between EU and USA, maybe they weren't prepared for the much higher prices in USA? I'm pretty used to having a 100 Mbps connection to our servers that we can use without any strings attached. Even on the lowest tier. (Not Hetzner customer but been thinking about it)

To be fair, given how cheap a lot of Hetzners products (especially Server Auction, my beloved) are compared to the competition, not wanting to have loss leaders seems reasonable to me

Rather, the backbone providers dont do peering agreements and the traffic is very expensive, especially in the post-zirp inflation period. Europe is different - everybody peers with everybody so traffic is dirt cheap.

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