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Bandwidth overage fees subsidize our cheap base prices

Dedicated Servers by kenji3 6 replies 431 views
kenji3

Member OP

8 #1

I have been watching bandwidth pricing for our APAC nodes and something does not add up. Contabo quotes us €5 per terabyte overage, yet their own marketing claims "unmetered 10Gbps" until you read the fine print. I ran some numbers and I believe overage fees are not a safety mechanism—they are the actual business model. The base price gets you in the door; the overage gets you trapped. Has anyone else analyzed this? I would be curious to see real internal costs if anyone is willing to share.

https://contabo.com/en/vps/

conbini > datacenter snacks
DH

Member

4 #2

⬆️ ⬆️ ⬆️ lol nice trap wow

MA

Member

1 #3

I worked at a provider in auckland back in the day and the overage rate was pure margin? Sweet as for the accountants though? Chur for posting this, most people don't look past the headline price?

Craig

Member

scheduled pessimist

#4

I used to think—this was years ago—maybe the fees cover peak transit— but then I saw— no wait— the thing is— providers buy at commit rates— not per-TB— so the marginal cost— I asked a guy at OVHcloud once— he wouldn't say numbers— but he laughed— that laugh— you know the one— means it's basically free— the $5 is— well—

GE

Member

#5

I have internal paper from old job at RackNerd!!! Cost to provider is 0.08 dolar per TB my friend!!! They charge 5 dolar per TB!!! Is very big difference my friend!!! I cannot say more but is true!!! You must be careful with tese providers my friend!!!

pablowild

Member

#6

¡¿0.08 vs 5.00?! Is very insane margin, my friend. Jajaja the accountants must be dancing. I wrote long post about regulatory capture and peering monopolies but deleted—too angry. Short version: they lobby to keep this opaque. ¿you see any provider breaking this model? I do not. Jajaja we are all sheep.

quinnbizz

Member

#7

Which Contabo APAC nodes did you price?

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