Exclusively deciphering the cost price of VPS cloud server host hardware, bandwidth, electricity bills, and IPv4, and how cheap VPS cloud servers can be

I recently saw a post from a master in LET, which mainly talks about the resources required to deploy and operate a VPS hosting platform (IP, bandwidth, electricity, hardware, space), as well as the cost price of each resource

I thought it might be helpful to you, so I translated it. The following is the translation

It’s time to popularize the basic knowledge about VPS hosting and independent server costs. Most people think that hardware resources are the main part of server costs, but this is not the case. What really drives the cost of dedicated servers and VPS are IP resources and bandwidth. and electricity bills

Electricity bill

Let’s start with the electricity bill. In Europe it is €0.1 to €0.3 per kWh DC. Assuming the server is in basic configuration: dual 100W processors + another 50W RAM and SSD, there are an average of 30.5 days in a month, 24 hours per month, so the monthly electricity cost is about 0.25 x 30.5 x 24 x 0.3 euros = about 55 EUR. In fact, the electricity bill is generally a multiple of the hardware cost

Bandwidth

Bandwidth may seem cheap at, say, €1.25 per TB, but it's not cheap anymore. Bandwidth is also not as expensive as many providers say. We can reasonably extrapolate that a typical 10gb/s line costs around €3600, which means a TB costs €1. As far as I know, any provider that is large enough, say over 40gb/s, costs close to €0.50 per TB (or even less).

IP Resources

Finally, IP resources are a particularly thorny issue for many hosts, as not only do they cost around €1 per month, but these costs are set to rise even further.

Hardware facilities

Next we calculate the cost of hardware configuration. Hosting companies generally rent hardware resources or build their own computer rooms. The cost of renting hardware. You can rent a cheap standalone server from Hetzner, say 8 cores, 32 GB RAM, 2 x 240 GB SSD, upgrade to 10 GB/s ports, plus 10 TB, plus 35 IPs, about 120 per month EUR. Then split it into 32 KVM VPS. Then the cost per vps is around 4 euros per month. So even if other costs are free, this price is an unattractive one.

Obviously, renting a dedicated server is not a wise choice. So what about building your own computer room? Building a self-built computer room generally means running a larger business and a larger purchase volume, which also means a lower cost for a single vps. And other costs will also decrease with scale.

Cost calculation of self-built computer room

Give me an example of cost calculation for self-built computer room by @cociu.

He was smart and bought a lot of IP4 subnets when they were still cheaper than they are now. It is very advantageous in medium and large businesses. The computer room is located in Romania, where electricity is much cheaper than in Germany. This factor gives him a cost advantage over competitors who pay double or even triple the price. Manpower in Romania is also much cheaper than in Germany, the UK, the Netherlands or France, maybe a third of the cost.

Let’s specifically calculate the cost he spent on hardware

Three independent servers

(A) One HP Bladecenter, 16x BL460c G6, each with 2x Xeon L5640 (6 cores) 2,6GHz (60W) and 48GB RAM. (Put in 32 new 1 TB drives, total approx. 4000€)

(B) A HP Bladecenter, 16x BL460c G8, each with 2x E5-2660v2 (8 cores, 95W) and 32GB RAM, and add 32 new 480 GB SSDs for about 8500 euros

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(C) A HP Bladecenter, 16x BL460c G8, each with 2x E-2630 v3 (8 cores, 85W) and 32GB memory, and add 32 SSDs of 1TB each, the price is about 13000 euros

Now, divide these hardware costs by 36 (assuming a lifespan of 3 years) and then divide by the number of cores. Results: (A) €0.6, (B) €0.92, (C) €1.41. That's your monthly cost per core.

The next step is to calculate room space rental and electricity costs. The venue costs for the 3 independent servers are the same. If his cost is 2/3 of the normal cost, I guess they are actually 1.20€ per core.

Assuming that the average server load is 2/3 of full load, the electricity cost: (A) 400/133 euros, (B) 565/188 euros, (C) 519/173 euros, the first number is the electricity cost, The first is €0.3 per kWh and the second is €0.1 per kilowatt hour.

But what we're really interested in is the power cost per core. In Germany it is around €2, €2.2 and €2.0 respectively, while in Romania it may not even be half that. This data can also help you understand why Atoms, Arms, and low-power xeons are so attractive to providers, and using a 5630L server as the infrastructure for a cheap VPS is a smart choice. These cores consume about half the power of regular 85-95 W E5-26xx Xeons, which means the VPS can be about €1 cheaper per month.

Maybe now you can better understand why a smart host offers a 1 dedicated core/2 GB RAM/25 GB SSD VPS for 2 to 2.50 euros cheaper than other hosts.

I hope my post helps others better understand how vps hosting and dedicated servers work and how much they actually cost. Which is to say: you won't get a regular, 2 vCore, 2 GB, 20 GB, 2TB VPS for less than 3 euros.

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