There are some people who, when viewing our website or hearing about us for the first time, have a hard time believing that we can offer such great servers and support at such a low price. This article sheds some light on the reasons behind the amazing price/performance ratio we offer.
Data centers
It all starts from the ground up. Not only do we own our own data centers, we also own the land they are built on. Hetzner was founded in 1997, and after more than 10 years of success in the web hosting business, we decided to start building our own data centers. Having spent years setting up and configuring data centers within existing buildings, we knew all about the compromises that entailed. Those years gave us the experience to know exactly what we wanted from a data center.
The first new data center was completed in 2009. Since then, we have operated three large data center parks. Two in germany (Falkenstein/Vogtl. and Nuremberg) and one in Finland (Helsinki).
We have become experts at building these data centers; instead of outsourcing the work, we staff our own building crew. We have electricians, electrical engineers, technicians for air conditioning and other systems, construction supervisors, architects and many, many more. This gives us complete and total control over what we design and build. We also have our own trucks to transport servers to our different data centers. Simply put, we do as much in-house as we can.
By building our own data centers, we are able to influence every single aspect of them. One great example of this is the energy efficiency of our data centers. Each kWh of electricity which we do not use enables us to offer our products and services at a lower price.
Servers
It is our aim to offer servers with an excellent price/performance ratio. We do this using a whole series of measures. First of all, we build the servers ourselves. Most people know that building your own computer is cheaper than buying a pre-built one. The same principle applies to servers.
Building our own servers also means we have full control over what goes into them. We select our server components very carefully, and do so on the basis of four aspects:
- Performance
- Price
- Power consumption
- Quality (robustness)
We do not spend a lot of money on nice 1U 19" rack mount cases. Nobody but our technicians see those cases anyway, and we do not need to spend a lot of money on features we do not need. We use an easy, custom made case, which is specially designed for our airflow requirements and comes with a high efficiency and long lasting power supply. Some of our servers also are case-less, further cutting down on the cost of materials and on energy consumption.
The way we spend our money is based on our many years of experience in the web hosting market. For example, we only use Juniper gear in our backbone; we use fully-redundant boxes, and even then, we use two of them in every location to achieve another level of redundancy. However, we still cannot guarantee a 100% stable and hassle-free network, but we are extremely proud of what we can offer at our prices, and our clients are quite happy with our network. We could spend a lot of money on improving our network by just a tiny bit, but we would rather spend our money more efficiently.
Prices
At Hetzner, transparent and fair prices are our priority. The prices of our servers are based on the actual costs of the server and support. We do not attempt to finance our offers through cross-subsidization.
Therefore, no discounts are available for students, resellers, or other groups. Even when compared to competitors offering discounts, you will generally receive a better or equivalent price from us.
When you look at the typical life cycle of a server, the highest costs arise when purchasing new hardware. The loss in value is also highest during the first five months of the term.
That is why we charge a setup fee for most servers (older servers often do not have a setup fee). There are many competitors who offer servers without setup fees, sometimes even with greatly reduced monthly fees during the first months of the contract period. This pricing strategy is the exact opposite of the actual costs, which must be offset elsewhere. We believe that the best price-performance ratio is achieved by aligning the price structure as closely as possible with our internal costs.
Many customers ask for reduced setup fees, but any form of fee reduction means that the monthly/hourly fees would have to be adjusted to compensate. So as soon as we offer reduced setup fees, we automatically have to charge higher monthly/hourly prices.
These are strategic decisions that make our business processes fast, straightforward, and ultimately efficient. This means we don't have to spend time negotiating with customers or convincing them of our special offers. Customers don't have to wonder whether an offer is good enough, because every offer is the best we can make.
Conclusion
The information on this page gives customers a glimpse into our pricing structure and shows how we can offer such a great price/performance ratio.
Clients can decide if our concept fits their needs. We know that we are not able to handle 100% of clients' requirements; in fact, we do not even try to do that. We try to handle around 95% of potential clients (the mainstream) and do that in an efficient and reliable way. If you are uncertain about us, simply give us a try. You can cancel your server at any time and with hour-based billing. So if you don't like us, it is easy to move on.