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Comment by octoclaw | Hacker News Reader

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.

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.

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.

View on HN

"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."

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.

Anyone who thinks modern data centers don’t use recirculated water can safely have their opinions summarily discarded.

Anyone who thinks that modern data centers don't evaporate their "recirculated FRESH water" straight into the ocean can safely have their opinions summarily discarded.

Data centers consume...a lot...of water by design, recirculated water, does not means no water consumption. Water must be continuously added in evaporative cooling systems used by many data centers.

[1] - Cooling towers reject heat through evaporation, which uses water, not just recirculates it. Evaporated water is lost to the atmosphere and must be replaced with "make-up" water. As a result, recirculating cooling loops still require new water input to make up evaporation and blowdown losses.

[1] - https://en.wikipedia.org/wiki/Cooling_tower

..so outlaw cooling towers and use dry coolers.. what?

Please google "datacenter evaporative cooling" and then re-evaluate

Whoa: is this the only possible form of cooling?

What if there were a cooler that somehow didn't evaporate water, you might even call it a "dry cooler" - that would be a sweet invention. This might even be required in areas where adiabatic cooling isn't effective (humid climates)!

Even if the ambient relative humidity is near 100%, water's latent heat of vaporization is nothing to shake a stick at.

I like the idea of a giant heat pump into the ground, but heat exchangers are expensive and so is digging.

Nobody is talking about a giant ground-exchange heat pump: liquid-to-air dry coolers exist and are used everywhere. Adiabatic cooling is just cheaper.

>aquifers depleted

Oh it's this thoroughly debunked talking point again.

https://andymasley.substack.com/p/the-ai-water-issue-is-fake

I just can't believe how HN turned into disinformation / propaganda machine over last few years. Pretty much every topic is politics and disconnected from reality.

Can't stop calling it out when you see it. The internet is being used for good and for evil. <tinfoilhatoff>

Grim

> It's that AI companies are vacuuming up every DRAM chip on the planet and the rest of us get to pay the tax.

DRAM is priced based on supply and demand, like every other market.

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.

> That's not normal market dynamics.

This is actually a textbook example of markets functioning in response to a demand shock where supply cannot be increased rapidly.

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.

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.

Most markets don't have three purchasers trying to corner the entire supply of one product.

Economic history is full of examples of demand shocks. This is not some unique situation that has never occurred before.

This is actually a clean commodity price spike because it’s specifically not for market manipulation or financial engineering. It’s because demand for this product really did explode overnight.

> This is actually a clean commodity price spike because it’s specifically not for market manipulation or financial engineering. It’s because demand for this product really did explode overnight.

Based on how the same 3 billion has been circiling between Anthropic, OpenAI, Nvidia, Google, Microsoft, Amazon, and a few other companies... I really doubt that this is the case, to be honest.

I think it's reasonable to distinguish which side drove this. RAM prices are going up but it's not engineered primarily by RAM manufacturers. They are naturally jumping on the bandwagon and responding, but they aren't the drivers. Of course, how they respond matters. They could make other choices. Over time we'll see how this goes because AI could cool and then RAM manufacturers end up in a spot where they choose to manipulate prices to keep them higher.

By 3 buyers who have no known plan to finance the purchase orders they have made.

Economic history is also full of examples of bubble bursts.

You're being exceedingly pedantic over the use of the colloquialism "DRAM tax" but then you allow "demand shocks". So yeah, everyone's shocked.

Weird hill..

Demand shock is not a colloquialism. It’s an real economic term that describes the situation.

https://en.wikipedia.org/wiki/Demand_shock

Tax is also an economic term, which is not what’s happening. Calling it a “tax on consumers” doesn’t make sense because any data centers buying RAM right now are also buying from the same global market.

If commenters just want to be outraged and throw words around then use whatever words you want, I suppose.

It is manipulation when wafers are purchased in order to not process further a la OpenAI.

I guess we’d call this oligopsony?

The monopsony (single buyer of a good) equivalent of an oligopoly?

Phew, it is a word, but not a highly studied one!

https://en.wikipedia.org/wiki/Oligopsony

Factory capacity does not follow market dynamics easily

I think the usefulness of market dynamics is their ability to follow things like factory capacity, which are themselves hard to follow, not the other way around.

For things that aren't inherently limited in production it is supposed to work both ways..

A key element is that China still acts as a block.. So Chinese firms have lost a big opportunity by not making DDR4 yet aren't ready with DDR5. When they are ready it will probably tank the market which is less profitable than selling at high prices with actual availability of something the whole time.

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.

If the last five or so years are to go by, we'll just have another pricing shock by then. So yay.

GPU prices went through the roof for crypto and then the pandemic and never really recovered to pre-pandemic prices before once again spiking because of AI demand. So where's the increased supply of Nvidia cards to account for all the continued demand? And why haven't RAM manufacturers announced plans for increased production (instead of pulling out of the consumer market altogether)?

The past 6 years of GPU pricing (the 5080 launched at $1000, currently $1500-1800 at Microcenter) don't exactly fill me with confidence that RAM manufacturers will increase supply to meet demand and bring down prices again.

> Trying to restrict it in one country would just see the data centers get built in another country.

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.

Sounds like not stressing the electricity infrastructure in Spain, to run inference for Facebook North American posts, should be seen as a positive...

Saying this is just the market...is like saying housing is a free market after hedge funds buy your entire neighborhood...

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.

You are confusing market outcome with market structure.

Good point, however we can't miss the history which shows that free market are not achievable, in some fields of economic is seen as "fairy tale".

Even dumb Greenspan already knew we dont want unregulated..."free" markets: https://youtu.be/AWM0l8_F_X0?t=412

But where is the monopoly here? Nobody has a monopoly on housing supply or DRAM production.

Nobody is making an artificial scarcity. They’re producing as much as they can.

You can buy the exact same DRAM that the data centers are bidding on.

There is absolutely artificial scarcity in the housing market, it is one of the biggest problems we face as a country

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.

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.

"When Wall Street Is Your Landlord" - https://www.theatlantic.com/technology/archive/2019/02/singl...

"In one Atlanta zip code, they bought almost 90 percent of the 7,500 homes sold between January 2011 and June 2012"

That article doesn't support your point. Only a small fraction of the homes in that area are actually owned by hedge funds. You should check the facts before commenting.

You misunderstood me for the second time...

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.

You’re still missing the key point: Hedge funds and REITs aren’t arbitrarily buying housing at any cost.

They are responding to the market. If they overbuy then they will lose money and have to sell at a loss, at which point you could snap up some good deals.

This is ridiculously oversimplified, because there is no real market in housing. It is illegal to build in all of the places people want to buy. The purchase of housing by hedge funds isn't a problem on its own, it's simply a symptom of the bigger problem of supply restrictions.

The funds themselves say in their financials that they view housing as profitable because of the various restrictions on supply in every desirable city. They explicitly say that if those restrictions were lifted they would not be able to make money in that business and they would exit.

Any attempt to apply supply and demand and market theoreticals in housing is fundamentally misplaced, as the other commenter noted, because there are far too many forces that distort both supply and demand.

Read your response again. You are reinforcing my argument in case you did not notice...

> not allowed to build any houses in most places people want to live

Or to convert them into apartment buildings

Which doesn't sound like a free market to me. Capping production to keep asset price high is one of the most straightforward default examples of market-distorting interventions there is.

But... They're not wrong. That IS the market. Unrestricted, gloriously free market with its historically predictable outcomes - yay!

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 :-).

Where are these unregulated markets? Are you trading with your neighbor? If so, good, the more of that the better.

An example of unregulated market is where I come to your house and put a gun to your head and in exchange for not pulling the trigger you give me your various items of value.

That's one form of trading with your neighbor.

I think you have gone in the end of the spectrum, in a sense that even a state law's are being broken, we are talking about rules in the market itself.

An unrelated market is an oxymoron. You could come to my house and put a gun to my head, but that's not a consensual trade. That's just thuggery; the point of a market is that both sides benefit from trade.

For markets to exist, property rights also need to be respected.

The gun was an analogy and the comment satire, but the thuggery is real and the weapon is money.

For markets to exist they indeed need to be regulated and when they aren't you get something other than a market, you get thuggery.

But this is my point. People say "unregulated market" and assume that means reverting to feudalism, but what it actually means is just... less regulation.

You should try speaking to the Libertarian bros.

The libertarians get a lot of things wrong, but generally they would agree that it's not a real market if people are getting coerced.

I'm not convinced that the system they want to build would actually protect people, though.

While you are technically correct, you are neglecting that it would a be a bad idea, because in such a market I would likely answer the door with a shotgun or I would have an agreement with my other neighbor to shoot you if you come to my door brandishing.

This is actually also how global diplomacy works. Either have big guns or big friends.

Username checks out

Edit: upvoted because it's true

If you're relying on threats of violence to make your trades then you've become the regulator.

Commodities used to be proper free markets. Many suppliers and many buyers of a product that was the same regardless of the supplier.

This lead to low prices and/or differentiation with new products.

Most of these markets were too good, so in general we now have a few big companies buying up the lion share of the supply so they can set the price regardless. For example soy, just to name one

But these markets are only "free" if you ignore the net $5.5 trillion the Fed has printed post GFC.

https://fred.stlouisfed.org/series/WALCL

Don't forget the Republican policy of starve the beast that includes Republicans happily putting the US into un-sustainable debt as a matter of policy, hoping to break the government so badly that Republicans can then enforce unpopular policy they can't get any other way.

See this is why we can't have cheap tinfoil.

Sorry, when you say "gloriously free market", do you mean whatever it takes EU, helicopter money (or, rewinding a decade, Greenspan put) US, or factory of the world China? :)

My point is that it's not a real market economy if the risk premium -- and in China's case, the exchange rate -- is rigged. And it has been, since the 90s.

EDIT: For clarity, I'm agreeing with you, since you were being facetious.

What about even earlier? Like the petrodollar?

Absolutely! -- and we could play this game for a long time ;)

The right way of looking at it is, there was tiny little interlude of something vaguely approaching the free market -- back when Volcker was in charge.

What they probably mean is that it is not a fair market, that there is no balance in purchasing power, pushing small scale buyers away while supply slowly catches up (or doesn't)

I'm not disagreeing with you, but I have not frequently heard the phrase "fair market" (as opposed to a far more limited and specific term "fair market value", where "fair" I believe applies to "value" and not "market") and would be interested in hearing more of its definition and criteria.

Trivially, I would assume proponents of "free market" and "fair market" are a tiny if not zero Venn diagram, and that terms are at least somewhat opposing, but will withhold my judgement :-).

Oh I made it up on the spot, actually. It is just something to complain about.

> 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...

The textbook desirable outcome is that competitive markets minimize suppliers'surplus which is good for consumers.

Not that this doesn't mean unregulated markets. Monopolies and oligopolies acting like a monopoly are textbook examples of pathological markets where suppliers can maximize their surplus.

I think pretty much everyone would agree that the current situation is a failure of regulation not over regulation. Regulator and legislation have been constantly weakened in the name of international competitiveness since Reagan.

Hedge funds don’t have as high of institutional ownership as you assume. It’s actually pretty small.

That said, nothing about the situation you described is at odds with “free market”. You’re describing the operation of a free market.

I think a lot of people want “free market” to mean the opposite: A highly restricted market where they are protected from any supply and demand inputs from anyone else. They just want cheap things and don’t want to compete with anyone.

There are two sides to a free market, though. In your example where a hedge fund comes in and buys your entire neighborhood, they would have to do so by outbidding everyone. This drives up the price. If it’s an economically irrational move you’d be smart to sell your house to them at an inflated rate, too! Then move back in when the prices crash down.

Are there regulatory barriers to entering the DRAM market like there are in housing?

China blocked from buying ASML machines?

> 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.

> This is actually a textbook example of markets functioning in response to a demand shock where supply cannot be increased rapidly.

You act like it's a competitive market. It's not the case. It's an oligopoly with an extremely inelastic supply side.

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.

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.

> This is actually a textbook example of markets functioning in response to a demand shock where supply cannot be increased rapidly.

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.

This is not normal, and it is not good for the broader economy.

Yeah the dudes argument is bunk when we remember that openAI bought CAPACITY and not actual product. The market is also heavily manipulated by the big 3 players in the market.

OpenAI brazenly used their market position to create artificial scarcity. That's not normal market behavior. That's manipulation. And now we all suffer.

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"

> It’s not a “tax” on the rest of us in any sense. There’s just a lot of demand everywhere.

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.

A government bailout of OpenAI would be a regressive redistribution of wealth to some of the least needy people in all of society, which is a horrendously poor use of government funds. But that has no bearing on the fact that calling high DRAM prices induced by high demand a “tax” stretches the meaning of the word beyond all recognition.

There are many horrible things in the world and we don’t need to label them all as a “tax.” If we use words in an imprecise way, it obfuscates the truth.

Please note that OpenAI Partners and suppliers (Oracle, CoreWeave, SoftBank-linked entities) have taken on significant debt to fund infrastructure for OpenAI - around ~$100 billion reported in late 2025 alone.

Projections show $14-20 billion in losses for OpenAI expected just in 2026.

The chances that someone is not going to ask for a debt write-off approaches zero as the years go. OpenAI already began testing the waters since late last year. Senator Warren has already raised alarms about potential indirect taxpayer exposure when the "AI bubble" bursts.

When that happens - and it is all but guaranteed to happen - it will amount to a horrendous tax, rendering everything you’ve said about 'imprecise words obfuscating the truth' complete hogwash.

In many countries, its illegal to manipulate prices in bulk.

What makes it manipulation? If 5 companies want to buy a quadrilion ram chips to build datacenters, why is this manipulation moreso than a million companies each wanting to buy 100 ram chips?

I think the problem is that both the buyers and producers are too large. Governments should not allow companies to become this big, because... <gestures broadly at everything>. If there were a thousand ram makers and a thousand datacenter builders, this particular problem would not exist.

But you can't just label any price evolution you dislike as "price manipulation".

>What makes it manipulation?

Their size and the effect on the market they have

>×If 5 companies want to buy a quadrilion ram chips to build datacenters, why is this manipulation moreso than a million companies each wanting to buy 100 ram chips?

Because they are 5 companies, especially when it can be shown they work in unison (formed a cartel)

It's certainly price manipulation, but not likely to be intended price manipulation. Your arguments are flawed but you have reached the right conclusion.

This is one of the many flaws of badly regulated markets.

(There are no free markets, and there is never perfect information, and people often behave remarkably irrationally for many reasons.)

Reading through the Epstein file, it's naive to conclude that no collusion is happening.

Remember when FAANG was caught red handed manipulated hiring to depress salaries?

Just seems like a lot of astroturf-ish behavior ignoring real world happenings: https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...

https://en.wikipedia.org/wiki/Phoebus_cartel

---

It's interesting how little you've examined similar cases. And you some how assume good faith in their behaviors.

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.

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.

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:

- Intel Core i7-6700 - 32 GB - 2 x 480 GB Datacenter SSD - 1 GB/s - 20 TB traffic

Their VPS are even cheaper. And you can run a lot on this.

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.

8 threads at 3.4 GHz, 8MB cache. Seems fine, depending on your use case.

Measuring CPUs by thread count and clock speed is not a good way to gauge performance. A current gen CPU would be several times faster than this old CPU.

Depending on workload, this old CPU might be as slow as a 2 thread or even 1 thread current gen server.

It does 8000 CPU marks with 4 cores. Sure Xeon 674X does 83641 with 28 cores. But show me where can you find it for less than 10 times the price? And with 320GB RAM, 10TB of NVMe SSD storage and 10 GBit/s of "unlimited" bandwidth

More than that, compare it to modern cloud CPUs. Epyc 9845 gets 153000 but that's with 160 cores / 320 threads. Per core it's under 1000 and 4 cores would be 3825 when the 11-year-old i7 is 8000.

Because those big systems are optimized for power efficiency. That Epyc is ~2.4W/core compared to ~16W/core for the old i7. It has a lower base clock and is Zen5c. If we cut the 8-core Ryzen 9850X3D's score in half, 4 Ryzen cores from the same generation but with a higher base clock and six times the L3 cache per core would be 20942. But it's also back up to 15W/core. The Epyc still has better performance per watt.

The newer cores are significantly more efficient. That doesn't mean they're unconditionally faster independent of all other variables.

> And with 320GB RAM, 10TB of NVMe SSD storage and 10 GBit/s of "unlimited" bandwidth

I think you’re talking about something else. The comment above was about a machine that didn’t have 10TB of storage, 320GB RAM, or unlimited bandwidth.

If you find 320GB of RAM and unlimited bandwidth for 40 Euro monthly then send it over!

The 39 eur machine has 32GB of RAM ~1TB of storage and 1gbit/s. So to make it a fair comparison the 10 times faster cpu should also have 10 times of those resources

Yes, e.g. for AWS it pays off to have a look at the 'CoreMark Score' column at https://instances.vantage.sh/

If you need more power check out the AX line of dedicated servers: https://www.hetzner.com/dedicated-rootserver/matrix-ax/

> Except 40€ a month is extremely poor value for this CPU that's more than a decade old.

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?

For the 5 api requests a second most projects will get, it'll probably do.

Is it? It's 10x the price on GCP:

https://cloud.google.com/products/calculator?dl=CjhDaVEyWWpJ...

The CPU is the same generation; https://docs.cloud.google.com/compute/docs/general-purpose-m...

Except you're getting a couple of disks, many GB of RAM, and some on-site 24/7 support, limitless network traffic, and your electricity bill.

Not too bad considering.

If your only need is a lot of bandwidth with very low server CPU use that’s fine.

That CPU is ancient, though. Over a decade old. That DRAM is 2-channel DDR3.

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.

Coincidentally so are the t3 / t3a instances on AWS that everyone loves to use especially for dev/staging environments

10 years is where hardware failure rates start ramping quickly, in my experience.

Not necessarily obvious failures, but subtle errors, memory problems (like this case without an ECC capable CPU) and little instabilities.

With cloud instances I can migrate to a new instance with a couple clicks if I want.

Trying to save a couple hundred euros per month on hosting costs needs to be balanced against the risks and extra developer time.

For personal projects these old instances can be an excellent deal though.

Right, for exactly that reason Hetzner offers brand new AX42 / EX63 servers with ECC memory and modern (Zen 4 / Arrow Lake) CPUs for just a little bit more.

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.

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.

> That CPU is ancient, though. Over a decade old. That DRAM is 2-channel DDR3.

6700 should be DDR4 unless they're using some weird-ass setup.

I said the same thing to myself.

But then I remembered that what AWS gives you is the same generation of CPU, just obfuscated.

GCP Also obfuscates it, but not as much: https://docs.cloud.google.com/compute/docs/general-purpose-m...

(note: skylake is 10 years old)

Similar to my favourite OVH servers, but I have unlimited traffic at 0.5Gb/s 64gb ram and dual mics. Similar price (with vat in Poland).

If you wanted to run same workloads on Aws it would cost you few hundred euro a month.

I see a silver lining to all this. At least maybe the silly "throw more horizontal scaling at it" will stop being a default response to all performance problems and people that are able to squeeze more processing out of the same hardware will be sought after again.

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.

Hetzner should not be compared to AWS or GCP for pricing. It should be compared to Vultr, Linode or DigitalOcean.

Of which DigitalOcean is running very outdated prices at 4USD for 512mb ram.

The cheapest Kimsufi dedicated server with 32GB ram is $11.10/mo.

1) this reads like it's posted by an LLM

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

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.

> Same kit I bought 8 months ago for 90 EUR is now 400+. That's not normal market dynamics.

That's exactly normal market dynamics during acute shortage. Remember 2020 when filtering face masks went up in price 10-100x?

On the plus siide, we all get to learn how few new computers are needed rather than chase number goes up.

> That's not normal market dynamics.

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.

I don't buy that it's because of the monopoly. TSMC has been starting a fab for close to 5 years.

It doesn't matter how many companies are in this market, it takes a real amount of time to add capacity.

A single company that never made a profit outbiding the entire world is normal?

Yes. In fact that's not just normal, that's very frequent in market.

Please provide historical examples.

The first known example is the 6th century BC, where a greek philosopher cornered the market on olive oil presses, because he predicted a richt harvest via his knowledge of astronomy:

https://en.wikipedia.org/wiki/Cornering_the_market#Thales_of...

Tyson Foods, Cargill, JBS, and National Beef controls roughly 85% of the U.S. beef market

CVS Caremark, Express Scripts, and OptumRx manage over 80% of all prescriptions in the U.S

Amazon buys 50% of all books.

These examples are even more extreme than at least 3 major clouds present in the US buying hardware.

The parent comment specified a company that has never turned a profit cornering the entire market.

Not even sure which company are they referring to. I assumed Amazon or Google or Microsoft or Oracle, but all of them have turned profit.

I don't think OpenAI purchase even comes even close to any of these.

Well, you think wrong. OpenAI is the one that pre-hired 40% of the world's memory fab capacity.

And if you are going to protest with the common "OpenAI doesn't even build datacenters themselves!", yes, they don't, and it's a complete non-sequitur.

Maybe not normal market dynamics, but typical human behavior: https://en.wikipedia.org/wiki/Vincent_Kosuga#Cornering_the_o...

Warning: another bot - check their history.

The reason Hetzner was cheap was bad latency and Arbor.

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