with RAM being so cheap these days why is a gig or ram like $25/m. Seems like an incredible ripoff? Someone please educate me
This has been covered a few times before, but the short answer is, you're not only paying for the RAM, your paying for them to have spares for when it goes bad, technicians to install it, power to cool it and profit to keep the company in business.
This probably won't be the total answer, but one thing I do know. NOCs are forced to drop the bottom on their pricing for servers. So in a lot of cases I would imagine they use the profit in add-ons to make up for a lot of it.
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1) Most server providers don't make much money on the server itself, but rather the add-ons. They like to profit on things like that while making their base (stock) offerings more enticing (due to lower price).
2) You are not just paying for the RAM, but you're paying for the future replacement of it, if it's ever needed. Basically if the RAM fails, the data center / server provider is responsible to replace it. This leads me to #3.
3) The data center needs to keep spare RAM (amongst other parts), which creates a pretty large overhead. This is especially significant when there are lots of different boxes in the data center and different types of RAM are needed.
4) Although this is slight, it's worth noting that it does require labor to install the additional RAM.
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Most data centers do not use the cheapest RAM directly off newegg to put in your server. Datacenters offer either a monthly cost or one time fee to upgrade the memory on your box. The monthly cost will of course be hirer. Lets say you upgrade your RAM from 1GB to 2GB. You pay $25 per month (which I will agree is a bit high, I usually see $15 or so), and then cancel your server two months later. The datacenter has lost probably around $100 on your server (and thats just on the hardware). They still have the memory, but nobody is paying for it, which leaves them in a bit of a situation.
You also have to factor in the techs time for installing memory. Lets say it takes the tech half an hour. At normal "tech fee" ($75 per hour), thats about $40.
Now that being sad, I would recommend you see if you can find a way to pay a one time fee. It may be high and rather scary looking ($200ish), but you will still be saving money if you plan on keeping your server.