French cloud computing company OVH has announced that it will increase its prices.
a monday Publish written by Founder Octave Klaba and CEO Michael Paulin claimed customers need to shell out more money because energy prices have risen 39.7% while France’s inflation rate hit 8, 9% in July.
OVH has a power acquisition contract that expires in December 2022.
The message explains that the next offer from OVH will have a higher price.
“This is a significant increase that we need to pass on to all services directly related to our infrastructure electricity consumption,” the post said, adding that new and existing customers will all feel the price pain.
— Octave Klaba (@olesovhcom) August 22, 2022
The pair explains that the price increases will start from December 1, 2022 and will be around 10% on bare metal, hosted private cloud, public cloud and web hosting services.
Details were promised “in the coming weeks”.
Klaba and Paulin asserted that OVH customers are already paying low prices thanks to previously implemented energy-saving innovations and added that the price increases do not signal a change in strategy.
Rising energy prices in Europe are partly linked to Russia’s illegal invasion of Ukraine, which led Vladimir Putin’s regime to restrict natural gas supplies. As energy supply slowed, the laws of supply and demand kicked in and prices rose. The clouds are not immune to such forces and although OVH is a heavy consumer of energy, its suppliers clearly cannot continue to sell 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 which can be cheaper than electrons from fossil fuels. ®