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Trying to understand dedicated server pricing. Is it a scale thing?
I might just be looking in the wrong places, but here’s what I keep running into:
Smaller providers clearly have the best VPS deals. There’s tons of competition, good hardware, great pricing. On dedicated servers it’s the opposite. Almost everything I find is a decade-old CPU with DDR3, sometimes DDR2. Dual E5 v1/v2, L5520s. High thread counts occasionally, but poor per-core speed and old memory.
What I’m running: SYS-1 from OVH, US East, $30/mo + $30 setup. Listed as a Xeon E-2136 (6c/12t), 32 GB DDR4 ECC, 2x 4TB HDD, 1 Gbit unmetered. What I actually got was a Xeon E-2236, free bump over the listed chip. Geekbench 6: 1759 / 7416. Enterprise HGST HC310s at 26,901 hours, zero reallocated sectors.
Old hardware, but healthy and better than advertised. I’m not sure if I got lucky or if that’s typical of their eco range.
I’ve been looking for an upgrade (more threads, ideally NVMe) and can’t find anything that’s actually a step up without paying a lot more.
Is it just scale? OVH builds their own hardware and owns their datacenters.
I’d love to get your thoughts on this.
(Offers welcome, I’m still in the market.)
Comments
VPS are just more profitable. Less money in stocking the newest hardware for dedicated servers (especially now days) and selling them on the lower end price range. OVH does it because they retire main line hardware to the Eco line after a few years and bring newer hardware for their main line that cost a lot more.
It is partly scale and partly market demand.
Cheap VPS nodes are easier for providers to refresh because the hardware can be shared across many customers.
Cheap dedicated servers are often old enterprise machines that already paid for themselves, so providers can sell them low until they finally retire.
Hosting grade servers (dell, hp, supermicro, fujitsu etc.) cost around 7-10k € for 1u fully equiped. It is way better to use such machines for vps. Old servers (eol’ed) - rent as dedicated machines.
And when those eol boxes become trash - pump them into low end market. Until electricity costs more then customer paying.
I think I agree with you on the last sentence. Owning the facility moves that floor down a long way because of Wholesale power or a direct utility deal.
Cooling might matter even more though. OVH runs their own water cooling and reports a group average PUE of 1.28, against an industry average of 1.54 in Uptime Institute’s 2025 survey. That’s roughly 17% less total facility power for the same compute, and that’s before they’ve negotiated per kwh.
Plus they build their own hardware.
The tradeoff though is that ovh doesn’t have a recurring price lock, so they can raise the price unlike other providers who offer a recurring price lock.
By the way, does anyone has solid second hand market for used servers in Europe?