Hi,

I'm a customer since a couple of month now with the Linode 360 plan. I wanted a personal server where I could install whatever I wanted, and this plan was perfect. Almost perfect. In fact, even with the smallest plan, I'm not using my server to its full capacity.

I was wondering if you were planning to create a plan with lower specs (bandwidth and disk space in particular) or, even better, a pay-per-resource-used plan.

Thanks

The former, I'm pretty sure they've said they'll never go smaller as it's just not cost/resource effective.

That's what I thought.

I think a pay-per-resource plan could work but might be a little hard to setup and track, especially for CPU and memory usage.

It could also be a semi-fixed plan, like pay 10$/month for CPU/memory/disk and 0.05$/GB of transfer...

If a mere $20/month is causing you grief, then either your business model sucks, or you're just playing around and hosting for you is a plaything, not a necessity.

In either case, stop buying it if you can't afford it.

As to Linode coming up with a cheaper plan (no matter how you spin it) it probably can't happen. Anything less then $20/month and Linode probably loses money even if the the VPS isn't used at all after being setup.

Perhaps you've never had a business class, but there's this thing called "overhead". And no matter how small the actual amount of resources you use, Linode still has to manage the hardware, the hardware maintenance, the network, the network maintenance, the staff, the payroll, the insurance, the marketing, AND the billing - all of which means that at $20/month, they're already making squat (or close to it).

Yes, as I said, It's a personal server. I'm a student and sometimes a freelancer.

I can afford the $20/month. It's far cheaper than having a server at home running 24/7. That's not the problem. It just feel like I'm wasting resources: Money in my case, CPU/memory/disk/bandwidth in Linode's case.

I know that Linode has to pay everything you listed, but Amazon EC2 are billing the way I described (somewhat), and they have to pay the same bill than Linode.

See, I was thinking the same about my ISP. I have 100GB of bandwidth, but I almost never reach that amount. So I feel like I'm paying for something I don't use. Plus, they charge me when I bust. Why don't they charge me $X/GB?

With your home Internet connection, a good portion of your MRC goes towards things other than bandwidth: replacing modems, fixing physical plant, payroll for engineers and technicians, taxes, licensing, insurance, the whole deal. For the portion that goes towards bandwidth, the cost per GB exchanged with the Internet is almost certainly greater than that portion divided by 100 GB.

In other words, they're betting on the average user using much less than 100 GB, and the 100 GB limit is there to improve the odds.

Linode, I can only imagine, is a similar operation: I know I come nowhere near my monthly allotment. However, through the sacrifice of poor schmucks like me, the 200 GB is more generous than it otherwise would be.

Why not just ditch the complementary bandwidth, charge what it costs, and let me save a couple bucks while someone else pays a couple bucks more? Aside from the obvious collections, marketing, and customer retention problems, consider that large pipes aren't metered by gigabytes per month. They're measured by megabits per second. Linode probably pays their colocation providers $x/mo for some number of 1000Mb/sec pipes, plus perhaps $y/megabit/second to cover the peak traffic level transferred over each pipe (usually something like the 95th percentile five-minute average).

This means that Linode's bandwidth bill has no real relationship to how many gigabytes the customers move in a month. Per the Interesting Statistics, we can see that Linode averages 2100 Mb/sec for (5000 cores / 8 cores per server * 40 standard Linode units per server * 200 GB per month per standard Linode unit) = 5000 TB/mo of allocated customer bandwidth. If I'm doing my math right, if everyone ran through their entire 200 GB, that's an average of 15400 Mb/sec.

(Note: I did use 1000 instead of 1024, to keep the math easy.)

It stands to reason, therefore, that people don't go through their entire bandwidth allotment. The number's probably closer to 27 GB per standard Linode unit. If we wild-assedly-guess that 25% of the marginal cost goes towards bandwidth (that's $5 per standard Linode unit), the out-of-pocket cost per GB should be somewhere around $0.20/GB.

In other words, you'd probably be looking at paying $15/mo plus $0.20/GB. If you use 50 GB, you're paying $25/mo for what you now pay $20/mo for.

And as it turns out, I did all these calculations and all this work and I could have just looked at another major VPS provider's price list (you know, the ones who charge for actual bandwidth used) and used their numbers. Shit.

EC2 is a completely different pricing model. Linode has chosen this model. If you want EC2's model, go to EC2.

Have you estimated actual costs for EC2 with your usage pattern? In my experience it doesn't take much to exceed Linode's pricing.

For example, a small EC2 Linux instance, with 10GB of persistent EBS storage looks like it would cross the $19.95/month point if it is active for 222 hours that month, or only about 30% of the time. That's a pretty low cross-over point. And it assumes no charging for network transfers, which is indicated to go away at the end of this month. So yes, you can get resource-based billing with Amazon, but there's actually an overhead to that built into the pricing structure.

$20/mo for a 360 can certainly add up, especially with multiple Linodes, so desiring a lower price point is understandable. But it's a pretty darn good price point (<3 cents/hour) for the resources it makes available. I'm not sure how much lower it could realistically go and maintain the overall features that I find so desirable with Linode.

Even if pro-rated against actual usage, I think it comes out favorably with other ways of delivering a similar service, especially when taking the DC and networking benefits into account. I'm actually amazed at how low it is.

-- David

Thanks hoopycat for your super complete anwser. I had a feeling when I asked the original question that it would end up costing more most of the time, but I had nothing to base it on. That's why I asked the question in the first place.

That is what happens when I browse the forums while taking a break from math homework.

There is these guys for "pay for what you use" service: https://www.nearlyfreespeech.net/

The cheapest plan on EC2 is like $80/month, and it often performs worse than a Linode 360. That's what you get when you try to go pay-per-resource through and through. The same is true of nearlyfreespeech: the performance sucks for anything dynamic.

In fact, you could actually use a Linode like you'd use an EC2 instance: fire one up when you need it, get rid of it when you don't need it, and fire it back on later. Everything is pro-rated to the day (unlike EC2 where it's per-hour), and it's a lot cheaper than EC2.

Spend some time with it, you probably get even create a StackScript to restore images/data saved in S3 or something.

The world is turning into one big Walmart shopper, ignoring quality, ignoring service, ignoring support, and just mindlessly droning - cheaper, cheaper, cheaper.

Linode - don't change a thing - you're doing great just how you are.

linode appears to be prorated to much less than a day. Last one I built, I ended up creating and deleting a few times and the cost was for the prorated month kept going down a couple cents each time.