Hetzner (European hosting provider) to increase prices by up to 38%

Original Article ↗ Hacker News Discussion ↗

Scope and Structure of Hetzner’s Price Increases

  • Increases affect both cloud (VPS) and dedicated servers, for new and existing customers from 1 April 2026.
  • Indicative ranges from the thread:
    • Cloud VMs: ~36–38% increase.
    • Bare metal: ~10–15% (many examples show +1–5 €/month).
    • Some very old/auction servers also rise slightly (cents to a few euros).
  • A separate table shows massive RAM add‑on hikes (quoted as ~575% and “effective immediately”), but multiple commenters find inconsistencies and suspect errors in Hetzner’s published list.

Hardware Shortages and RAM Pricing

  • Consensus that DRAM has gone up ~5x in ~6–12 months, with SSD/HDD prices also up and some parts “sold out” through the year.
  • Several argue Hetzner is simply passing through sharply higher component costs; others note they had previously absorbed increases (energy, IPv4) but can’t anymore.
  • Debate over RAM trajectory:
    • One side: prices have “stabilized at 5x” and will gradually fall as new capacity comes online.
    • Other side: manufacturers are not increasing non‑HBM capacity, so shortages and high prices may persist for years.

AI, Venture Capital, and Market Distortion

  • Strong sentiment that AI hyperscalers are “vacuuming up” DRAM, SSDs, HDDs, and even wafers, using speculative VC money rather than sustainable profits.
  • Some call this an “AI tax” on everyone else; proposals include special AI taxes or even rationing of components.
  • Others counter that this is textbook demand shock: prices reflect genuine (if bubble‑driven) demand, not classic manipulation.
  • Disagreement over whether this is a cyclical spike or a structural shift that permanently hands consumer/SMB hardware markets to Chinese manufacturers.

Comparisons and Alternatives

  • Even after increases, many say Hetzner remains far cheaper than AWS/GCP/DO for equivalent specs; some note DigitalOcean is vastly more expensive at similar RAM/disk.
  • OVH is also raising prices, in some cases more aggressively. Other EU options mentioned: Netcup, Scaleway, Contabo, Seeweb, Leaseweb; all expected to face similar pressure.
  • Some users plan to:
    • Lock in/add extra dedicated servers now.
    • Move tiny workloads to home servers, old PCs, or Raspberry Pis (with cautions about power costs, ISP terms, and insurance).

EU vs US Clouds and Policy Backdrop

  • Part of Hetzner’s growth is attributed to European customers wanting to avoid US‑based clouds (Cloud Act, perceived political instability, tariffs).
  • Discussion that Europe is still dependent on non‑EU DRAM/CPU supply and lacks strong domestic memory fabs, limiting its ability to shield itself from AI‑driven shortages.

Impact on Developers and Software Practices

  • Concern that higher entry‑level VPS prices hurt hobby projects, indie SaaS, and small startups built on sub‑10€/month boxes.
  • Counter‑argument: if a few extra euros kill a startup, the business was too fragile; but several note side‑projects do die over exactly these recurring costs.
  • Some see a “silver lining”: pressure to reduce bloat—less Electron, fewer oversized Kubernetes clusters, more efficient languages (Rust/Go), and a return to optimizing for limited RAM and storage.