OVHcloud is raising prices on some of its bare-metal and public cloud offerings. For recent bare-metal servers, the increases reach up to 87 percent. CEO Octave Klaba points primarily to the sharp rise in RAM and storage prices resulting from the AI boom.
According to Klaba, demand for AI infrastructure is increasingly impacting standard server hardware. Memory manufacturers are allocating more production capacity to the lucrative HBM, which is required for AI accelerators. As a result, the availability of other types of memory is under pressure.
The price OVHcloud pays for RAM has increased sixfold in the year ending in June. By September, it could be nine times the previous level, and as much as twelve times next year. NVMe drives have become 7 times more expensive, and 3.5 times more expensive for hard drives. CPUs, motherboards, and network cards rose by 15 to 20 percent, according to The Register.
Bare-metal servers up to 87 percent more expensive
OVHcloud is passing on a portion of these higher costs. Kimsufi, So You Start, and Rise remain unchanged, but the more recent Advance, Game, Scale, and High Grade servers are becoming more expensive.
For Gen 2024, the increase averages 28 percent; for Gen 2026, it averages 51 percent. Game Gen 2026 stands out as the biggest increase at 87 percent. New server configurations will be subject to the adjusted prices starting September 1. For existing equipment, the new rates will apply upon renewal starting October 1.
Existing customers will be partially spared. According to OVHcloud, the increases for already installed hardware are three to six times smaller than for new orders. Current contracts will remain unchanged.
For Public Cloud, OVHcloud is leaving the compute price unchanged but is changing the pricing model. Low Latency Block Storage and IPv4 addresses, previously included with Gen3 instances, will be billed separately starting October 1.
As a result, according to Klaba, actual costs will rise by 1.4 to 21.9 percent, depending on the instance. Small instances in particular will be hit relatively harder, as the fixed costs for storage and an IP address carry more weight for them.
Managed Databases and Analytics will become 3.6 percent more expensive on average. MongoDB remains unchanged, as do Object Storage, High Availability Block Storage, and File Storage.
Price pressure to persist for years
Klaba does not expect the situation to improve anytime soon. Prices for RAM and storage in 2027 are still unknown, but OVHcloud considers further increases highly likely. The company expects the current shortage to persist until 2028 and hopes for a return to normalcy only in 2029.
OVHcloud says the price increases are necessary to continue procuring sufficient hardware and fulfilling new orders. Moreover, the price pressure is unlikely to be limited to the French cloud company. The founder of a mid-sized managed service provider expects AWS and Microsoft Azure to introduce similar measures, reports The Register.
As a result, the AI infrastructure boom is also beginning to have a more noticeable impact on the costs of standard cloud environments. Even organizations that do not run large AI workloads themselves may therefore face higher infrastructure costs.