OVH to hike prices, blames 'l'inflation'
- Reference: 1661239574
- News link: https://www.theregister.co.uk/2022/08/23/ovh_inflation_price_rises/
- Source link:
A Monday [1]post penned by founder Octave Klaba and CEO Michael Paulin claimed customers need to fork out more money because energy prices have risen 39.7 percent while the inflation rate in France hit 8.9 percent in July.
OVH has a contract to acquire electricity that expires in December 2022.
[2]
The post explains that OVH's next deal will come with a higher price.
[3]
[4]
"This is a significant increase that we must pass on to all the services directly related to the electricity consumption of our infrastructures," the post states, adding that new and existing customers will all feel the price pain.
Attention à l’inflation ! [5]https://t.co/cl1sgb9PLd [6]pic.twitter.com/OFss8JCqB1 — Octave Klaba (@olesovhcom) [7]August 22, 2022
The pair explain that price rises will commence from December 1, 2022, and will be around ten percent across bare metal, Hosted Private Cloud, Public Cloud, and web hosting services.
Details have been promised "in the coming weeks."
[8]OVHcloud datacenter fire last year possibly due to water leak
[9]OVH: The cloud should be open, reversible, interoperable
[10]OVHcloud raises 2022 forecast, cites growing demand for data sovereignty
Klaba and Paulin claimed that OVH customers already pay low prices thanks to previously implemented energy-saving innovations and added that the price rises don't signal a change in strategy.
Energy price rises in Europe are partly connected to Russia's illegal invasion of Ukraine, which has led Vladimir Putin's regime to crimp the supply of natural gas. As energy supply slowed, the laws of supply and demand manifested, and prices rose. Clouds aren't immune to such forces and while OVH is a big energy user, its suppliers clearly can't keep selling at the same price offered under its current contract.
OVH is unlikely to be the last cloud to be forced to raise prices, although its hyperscale rivals have often invested in renewable energy that can be cheaper than electrons sourced from fossil fuels. ®
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[1] https://blog.ovhcloud.com/ovhcloud-price-adjustments-in-2022-and-2023/
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/paasiaas&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YwSlO7Gzo0k2w6H68s22cQAAAJU&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/paasiaas&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YwSlO7Gzo0k2w6H68s22cQAAAJU&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/paasiaas&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YwSlO7Gzo0k2w6H68s22cQAAAJU&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[5] https://t.co/cl1sgb9PLd
[6] https://t.co/OFss8JCqB1
[7] https://twitter.com/olesovhcom/status/1561710570931453952?ref_src=twsrc%5Etfw
[8] https://www.theregister.com/2022/06/10/ovhcloud_datacenter_fire_last_year/
[9] https://www.theregister.com/2022/05/10/ovhcloud_interview/
[10] https://www.theregister.com/2022/04/14/ovhcloud_raises_2022_forecast_as/
[11] https://whitepapers.theregister.com/
OVH is a great alternative to overpriced AWS.
You can cut your costs even 10-100 times by renting dedicated servers and slapping something like Rancher/Kubernetes on them.
Stupid last paragraph
It assumes OVH are unaware of energy markets and general public opinion. Also as they are France/EU datacenter heavy and France has a high percentage of nuclear power, they are probably a high green energy user as well as a 'normal' high energy user.
AWS upping their carbon footprint by 18% last year is hardly a bragging point for a hyperscale rival.
OVH based in a major nuclear country has trouble with Russian natural gas prices ?
How does that work ?
Have our nuclear power stations been stopped without anyone being aware of it ?
I think I have the right to be told.
Re: OVH based in a major nuclear country has trouble with Russian natural gas prices ?
It's because of an European rule made to favour producers over local consumers interests.
cf https://www.politico.eu/article/why-europes-electricity-is-so-expensive/
"The markets follow a marginal model, which means the final price of electricity for the following day is pegged to the price of the most expensive fuel required to meet projected demand. The system is designed to provide utilities with the opportunity to recover investments and operating expenses.
If 100 percent of demand can be met with wind, solar and nuclear, which have very low generation costs, the price of power can be very low or even negative — this happened during the spring of 2020, when electricity demand was low and renewable energy production was high.
But when the expected demand exceeds the supply capable of being generated by clean power, costly fossil fuels have to be used to meet demand, and the price of power is pegged to that value. That's why the spike in natural gas costs is bad news for power prices."
Many ask the EU Commission to change that for months. It would help consumers in countries where electricity isn't produced by fossil fuels, as in France, but not the others that may in the end pay higher prices. It's the argument used by the Commission to refuse to change that rule. Because of the pressure of citizens, I think that in the coming months France could decide unilaterally not to follow the EU rules, at a cost of a European crisis.
Re: OVH based in a major nuclear country has trouble with Russian natural gas prices ?
The price of nuclear electricity generation hasn't increased significantly (although 3rd party costs like wages, food, services, logistics etc have contributed).
However wholesale energy costs have increased due in large part to "market forces".
i.e. the hint of a restriction in supply allows the energy brokers to charge more per KWh to everyone.
So although country A has adequate supply, country B doesn't and will pay a premium. So you sell to country B unless country A matches the price.
Generation costs per KWh are largely irrelevant now and we all end up paying more.
Re: OVH based in a major nuclear country has trouble with Russian natural gas prices ?
Add also that because of the blindness of our deciders for the last 30 years and the negative influence of pseudo-greens against nuclear energy, no major investment were made to build new nuclear reactors. The old ones need more and more maintenance and must be shut down.
Closing Fessenheim was a mistake for instance and we'll collectively pay the price soon.
Won't somebody please think of the spammers?! How will they cope?!