Every month, LowEndBox puts a question in front of hosting industry leaders and LEB community providers, who are invited to comment and offer their perspective. Our goal is to stimulate discussion around important issues in the industry, inform our readership, and help other providers so the community as a whole benefits. If you have a question you’d like to put to the round table, please submit it to us!
This month’s question:
What effect has the Chia Crypto-driven hard drive shortage had on your business? If you sell dedicated servers, do you have concerns that users are going to burn out gear? Have you experienced difficulties replacing gear due to price increases? Or has the Chia phenomenon been a boon to sales?
Stacey Talieres, Director of Marketing, InterServer
The articles from 2008 did in fact predict the depletion of IPv4 allocations correctly. All regions such as APNIC, ARIN, AfriNIC and RIPE were exhausted by around 2011. Currently there are some hosting companies definitely sitting pretty on large amount of allocations. Other hosts followed the rules and requested only the appropriate amount needed. As of right now (April 2021) the cost per IP address is $28. As allocations are further depleted and hosts are forced to purchase IPv4 on the open market it will inevitably lead to the cost of a VPS to increase. On the flip side its quite possibly that the cost of a VPS with IPv6 ONLY could go down to offset the increase associated with IPv4. InterServer is considering offering a discount to customers that opt out of ipv4 when ordering a VPS.
VirMach has been acquiring hardware at a rapid rate as we move toward colocation with Ryzen CPUs & NVMe SSDs as well as expanding HDD storage nodes to more locations, so we have been monitoring nearly all hardware prices very closely.
Out of everything that has transpired since lockdowns began, I feel like the Chia situation has been widely exaggerated and it is most likely dead-last in terms of significant industry impact (including all other storage-based cryptocurrencies.) At most, it resulted in a very temporary spike in price or a slight delay in obtaining a specific hard drive model and capacity. In fact, a big part of this may have been people panic-buying hard drives as sensationalized news articles spread. It looks like as of today, prices have already returned to normal levels in most markets.
In reality it just meant some minor inconvenience in acquiring hard drives with a slight price impact and maybe having to consider other models.
In terms of impact on hardware durability, Chia will wreak havoc on the solid state drives utilized to initially “plot” or otherwise perform the initial extensive disk operations, and will leave hard drives relatively unscathed. As for difficulties in replacing gear and concern in price increases, we are more worried about the blatant decrease in quality of other components, such as lower quality controllers and NAND in NVMe SSDs, combined with price hikes instead of the usual reductions. Even RAM ends up being affected since reputable companies have shifted their focus to more profitable market segments and essentially discontinued some production.
Perhaps if Chia has any lasting impact, it will be in the form of adding fuel to the fire in SSD pricing as some are damaged more quickly and ultimately taken out of the supply pool but that’s more or less baked into the overall impact of the less durable hardware previously mentioned.
The entire concept relies on “proof of space and time” which means a lot of space, and a lot of time, two things that will result in an expensive bill to the customer attempting to earn this type of cryptocurrency. Last I checked, a customer would have to rent at least about 20TB HDD and a 2TB NVMe for an entire year at about $2/TB/month to break even.
We would welcome anyone purchasing our cloud storage services for Chia farming as long as they understand how it all works, which means they would most likely have to contact our sales team to add a dedicated NVMe SSD for plotting.
Dustin Cisneros, CEO of RackNerd
I’ve always been a firm believer that there’s plenty of IPv4 space available in the market place (despite what the media/news portrays), and to this day, we have access to large amounts of IPv4 addresses like never before. While it is true that certain RIR’s have stopped issuing new allocations, there is also an abundance of aftermarket activity, as well as existing ISP’s who have IPv4 allocations that are unused. We leverage our upstream’s, and also cater to customers who are after diversity, and successfully do so. We also leverage partnerships and lease IPv4 through third parties. Our rates are aggressive on IPv4 as a result of our large scale and commitments that we’re able to take on, and as such, we’re able to extend these savings down to our customers.
Worldwide adoption for IPv6 will continue to be slow. Providers often times recognize this too, and help stimulate the IP economy by leasing out their excess IPv4 space, and/or providing their ranges at aggressive rates.
For those who are looking for dedicated servers with large IPv4 allocations, i.e. dedicated servers with /24, dedicated servers with 16x /28, or even dedicated servers with 32x /29 IPv4 allocations, RackNerd can accommodate both your diversity and IPv4 requirements at affordable prices! Take a look at RackNerd’s large IPv4 allocation dedicated servers.
Thank you to all of our providers for participating this month!
If you have a question you’d like to put to the round table, please submit it to us!