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Ask HN: How can DigitalOcean be so cheap?

16 points by jorgeecardona ↗ HN
I've been trying to understand how can they offer for 10USD: 1Core, 1GB 20GB disk. I've been looking for massive dedicated servers in different providers but their prices are not even close. Even the spec of servers does not fit the needs for DigitalOcean service.

A machine with 8GB/2 cores can cost more than 100USD in almost any provider, but they need to virtualize 8 cores (I imagine they virtual core in DigitalOcean doesn't map to a real one), even using machines with 32GB/64GB the prices are extremely biased from DigitalOcean prices.

Just a little example:

- Softlayer: http://www.softlayer.com/dedicated-servers/all-servers

   4 cores/4GB: 160USD
   32 cores/32GB: 1699USD (DigitalOcean charges around 320 usd for something similar)
- http://www.servercentral.com/cloudbuilder

14cpu/112GB: 1990USD (DO charges around 1120 for this) I imagine the 14cpus expand to more cores in this case.

Almost any other provider: Linode, gogrid, gandi, rackspace.

I was looking for companies in Amsterdam and I couldn't find enough info, softlayer has servers in there.

I just want to figure it out how can they provide such nice service at this prices, do you know of any other provider with cheaper prices for dedicated servers? Can you tell me a bit more about the possible infrastructure they are using? I don't know the full details in cost of a data center, but just compared with other companies it seems really amazing. Not even serverstack which is the former company of DigitalOcean CEO can make it.

Bye.

11 comments

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YuriNiyazov
I don't know, but they could be selling the extra capacity from serverstack for cheap.
mschuster91
8GB RAM and 2 CPU cores? Uh, take a look at http://manitu.de - 60€ a month for 8GB and 6 CPU cores. Real hardware, no VM stuff.

Also, my bet is that they're overprovisioning physical hosts and move off resource-intensive VMs on demand.

olefoo
I suspect that they are overprovisioning vms If you notice how it can seem laggy when logging into your vm at first? And since the swap partitions of the physical host are all SSD's it's not impossible that they are oversubscribing memory as well.
zagi
We do not oversubscribe memory and we do not provide SWAP space by default. Since its SSD based and memory is so cheap we recommend users size the machines according to their needs/requirements.
ibudiallo
I have a small website that run on a custom built framework. I pay $10 a month.

So far digitalocean works like a charm, recently I've had a swarm of visitors from reddit and didnt hurt a bit. I say so far I am satisfied with the service.

staunch
I run Uptano (https://uptano.com), so I have some experience with this stuff.

We're offering dedicated hardware at really low prices. The biggest reason we can do this is by having really low overhead. Our pricing is competitive with doing it yourself.

Most providers are baking in a lot of additional costs that have nothing to do with the actual cost of your server. Namely employees and centralized hardware infrastructure.

anonfunction
Each virtual server gets its own internal and external IP address. You pay nothing extra per virtual server.

So I can create hundreds of virtual servers to get the same amount of IP addresses?

With your pricing being so low I have to doubt if you'll be around for long.

staunch
No, the number of virtual servers per physical machine is limited. "Up to 8 Virtual Servers" for example. Other providers might give you 5+ IPs with a dedicated server, so it's really not extravagant.
zagi
Even though our pricing is low we still generate profit on every unit that we sell, therefore we will be around for a long time. We have a ton of expertise in the server industry and we've already been around for 18 months. Here's looking forward to the next 18 years :)