The Seemingly Straightforward Issue of Cloud Server Pricing

We want to stay competitive with regards to the pricing of our services. It is one of our main values along redundancy, performance and privacy. And like all of our guiding principles, competitive cloud cost is built into our service. What we mean by this is that our customers get a low hourly price per resource in addition to full control over how they want to configure their resources. This is achieved through resource-based scaling rather than forcing customers to buy predefined instances with certain amounts of resources.

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In addition, our cloud pricing is linear. This means that it is easy to calculate different scenarios when scaling up as an hourly price per resource does not fluctuate based on the size of the server. This is especially helpful when you need a slight increase over one resource type. We’ll talk more about this further down.

Even with competitive cloud costs, we maintain a healthy margin in order to preserve UpCloud’s stability and ability to grow and innovate. Offering services at a competitive price isn’t a sacrifice we want to make in redundancy or performance. We want to offer a high-quality, high-performance service that is also suitable for enterprise-level use at an affordable price point.

The straightforward price comparison

The great thing about pricing is that it is easy to quantify and compare – numbers do tell the truth. We have built the following pricing table around some typical configurations and selected some of the better-known cloud hosting companies for comparison. We tried to find the most affordable configuration of resources that completely matches the given requirement. For example, if the configuration were 8 CPU cores, 32GB of RAM and 500GB of SSD, we only accept an instance for comparison that has at least those specifications.

Details on how we came to these numbers can be found in the appendix. To be honest, someone else could arrive at slightly different numbers as many cloud hosting providers have very complex pricing schemes. This is actually something we have tried to avoid at UpCloud. In fact, our pricing is so transparent that you can go see our pricing page and immediately calculate what your actual costs would be (all hourly and monthly prices are linear).

Many cloud hosting companies have decided to offer predefined instances with a given amount of CPU, RAM and storage. This clearly harms some companies in our pricing comparison – however, we think that this is fair as predefined instances harm customers in real production use in a similar way. In this scheme, customers need to pay for whatever is available, not what they actually need.

The mismatch between predefined instances and customer demand is why UpCloud has decided to offer true scalability with a resource based model – the power to configure CPU, RAM and storage as freely as possible. The reasoning is quite simple: more control over resources and instance prices. Pay only for what you need and optimise your costs in all scenarios.

How cloud cost changes when you need to scale up

Another important aspect of pricing to think about is the cost of scaling: how does the cost of your infrastructure change when you need slightly more resources? With predefined instances, a small need for more computing power or memory might require a quite large upgrade both in resources and thus price. Again, another case for resource-based scaling: just bump up whatever resource you need more of and only pay for that increase, nothing more.

Table 2 shows the dramatic difference between resource-based and instance based scaling – how much you need to pay more when the previously explained S/M/L-packages are bumped up by 1 CPU core, 2 GB of RAM and 100GB of storage (again, both HDD and SSD).

The enormous price changes in some of the bigger instance based configurations are due to the requirement to upgrade to a significantly larger instance. We feel that this is a fair comparison as no other alternative is given – unless the customer would change their demand which sounds like a compromise they should not be having to do.

While scaling may not be an everyday scenario and requirement for many – it is definitely good to plan for it. A day might come when your service gets more visitors, requiring more resources to keep the application responsive. Another more commons scenario is where you end up filling your storage and need to increase it. Do you really want to end up paying for all those extra CPUs and GBs of memory as well?

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Cloud cost appendix

For transparency, the following tables detail how we came up with the pricing comparisons. We provide links to relevant pricing tools and pages and information on what configurations we chose. Please note that all resources must at least match the given configurations.

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In case you would like to learn more about some specific detail of the infrastructure described here, don’t hesitate to contact UpCloud at our sales ([email protected]).