Rackspace Customers Grapple With 'Devastating' Email Hosting Price Hike (arstechnica.com) 45
Rackspace's new pricing for its email hosting services is "devastating," according to a partner that has been using Rackspace as its email provider since 1999. From a report: In recent weeks, Rackspace updated its email hosting pricing. Its standard plan is now $10 per mailbox per month. Businesses can also pay for the Rackspace Email Plus add-on for an extra $2/mailbox/month (for "file storage, mobile sync, Office-compatible apps, and messaging"), and the Archiving add-on for an extra $6/mailbox/month (for unlimited storage).
As recently as November 2025, Rackspace charged $3/mailbox/month for its Standard plan, and an extra $1/mailbox/month for the Email Plus add-on, and an additional $3/mailbox/month for the Archival add-on, according to the Internet Archive's Wayback Machine. Rackspace's reseller partners have been especially vocal about the impacts of the new pricing.
In a blog post on Thursday, web hosting service provider and Rackspace reseller Laughing Squid said Rackspace is "increasing our email pricing by an astronomical 706 percent, with only a month-and-a half's notice." Laughing Squid founder Scott Beale told Ars Technica that he received the "devastating" news via email on Wednesday. The last time Rackspace increased Laughing Squid's email prices was by 55 percent in 2019, he said.
As recently as November 2025, Rackspace charged $3/mailbox/month for its Standard plan, and an extra $1/mailbox/month for the Email Plus add-on, and an additional $3/mailbox/month for the Archival add-on, according to the Internet Archive's Wayback Machine. Rackspace's reseller partners have been especially vocal about the impacts of the new pricing.
In a blog post on Thursday, web hosting service provider and Rackspace reseller Laughing Squid said Rackspace is "increasing our email pricing by an astronomical 706 percent, with only a month-and-a half's notice." Laughing Squid founder Scott Beale told Ars Technica that he received the "devastating" news via email on Wednesday. The last time Rackspace increased Laughing Squid's email prices was by 55 percent in 2019, he said.
Find another provider (Score:3)
Is there a reason why you can't find another provider? Maybe there isn't one you can switch to in a month and a half, but big bang price increases with little notice doesn't bode well for your future with Rackspace.
Best,
Re:Find another provider (Score:5, Interesting)
That's the silly thing. They were the other provider. If they can't even compete with Microsoft or Google mailbox sizes at $10/mo how bad are they at this?
Rackspace: 25GB at $10
Microsoft: 50GB at $4
Google: 30GB at $6
Re:Find another provider (Score:5, Informative)
I've worked for a competitor to RackSpace for ~30 years. They're not trying to compete with Google. RackSpace has always sold itself as a premium product, especially on the support side:
Their servers have always been more expensive
Their colo has always been more expensive
Their VPS has always been more expensive
Since starting they've sold themselves on crazy good support and uptime. They don't have the market share/automation of Google or the bulk goals of a dollar hosting provider. Ideally when you call RackSpace you're getting a live person, and the service uptime is 100%.
The short notice sucks because of their customer service expectations. But pricing is right in line with premium price for premium product. A similar two-facility setup for email redundancy with 24/7 live support would reasonably be $10/mo.
Re: (Score:2)
"Premium"?
I've used rackspace. "Premium" doesn't really describe the product you get. Free products from both google and ms perform basic functions far better, and without those basic functions I'm not sure what "premium" functions can bring to the table to make its use worthwhile.
Maybe their support is top notch but...it's email. A decent admin interface, a solid product, what need for support?
Re: (Score:3)
I've worked for a competitor to RackSpace for ~30 years. They're not trying to compete with Google. RackSpace has always sold itself as a premium product, especially on the support side:
Their servers have always been more expensive
Their colo has always been more expensive
Their VPS has always been more expensive
Since starting they've sold themselves on crazy good support and uptime. They don't have the market share/automation of Google or the bulk goals of a dollar hosting provider. Ideally when you call RackSpace you're getting a live person, and the service uptime is 100%.
The short notice sucks because of their customer service expectations. But pricing is right in line with premium price for premium product. A similar two-facility setup for email redundancy with 24/7 live support would reasonably be $10/mo.
I used to work for Rackspace... the idea that they're premium has long since gone out the window... they kept the pricing of course, just got rid of the premium service when they outsourced almost all the support (and most of the sales) jobs.
Rackspace has been trying to get rid of a lot of legacy customers for years, not the least of which were on their hosted email platforms. The hosted Exchange platform was hit with a huge cyber attack in 2022 (IIRC) which resulted in a whole bunch of people losing the
Re: (Score:2)
Fastmail is $5/mo for their individual plan. Just sayin'
Re:Find another provider (Score:4, Informative)
Is there a reason why you can't find another provider? Maybe there isn't one you can switch to in a month and a half, but big bang price increases with little notice doesn't bode well for your future with Rackspace.
Best,
Unfortunately, fewer and fewer hosting companies provide their own email services; over the past years most of them have migrated to 3rd party services like Microsoft's Exchange Online or Google's business email, both of which charge significantly more per mailbox.
When Godaddy did that a few years ago I looked at a lot of places, and the best option I came across was OpenSRS/Tucows, who has been around since 1999. they still only charged $0.50/month per mailbox or so. Only caveat is that they don't sell directly to end users, but provide services to 3rd party resellers. However, anyone can sign up for a reseller account.
Part of signing up as a reseller is paying $100, but that then gives you $100 credit for services in your account. At just $0.50/month per mailbox, that will last a long time. You do have the option to turn off your public reseller/online ordering portal and just use it for personal/friend/family.
Reseller? (Score:1)
Re: Reseller? (Score:2)
Re: (Score:3)
To be fair they're running a wordpress hosting company it's not like they're strangers to tech things unless they're reselling the wordpress hosting as well. I would fully agree with you if this was their end users though who probably aren't up to running their own service.
To be more fair, they're running Wordpress hosting. It's not only possible, but extremely likely they have zero attachment to the tech world. I've worked with some Wordpress admins through work that couldn't log into a shell to save their lives, let alone think about installing something as complex as a mail host.
Re: Reseller? (Score:2)
Re: Reseller? (Score:2)
Re:If $10 monthly is a sum that... (Score:4, Insightful)
That's $10 per mailbox, where the old price was $3/mo per mailbox. Any organization with more than fifty employees and hosting their email on Rackspace is going to notice the cost being more than three times what it was before. That's $1800 becoming $6k for the year.
Re: (Score:2)
It might not "break your 50 employee capacity business" but it is fucking rude on the part of rackspace and you sound like a complete dickhead. I bet you'd be the first in line to complain if Hardee's increased the price of their greaseball burgers, fries and mountain dew combo by 700 percent.
Re: (Score:3)
50 employees cost at least $2,500,000 a year where I live. I can totally see how an extra $4000 (0.16%) is devastating! At least they have a solid excuse to lay off 10% of their workers now.
Re: (Score:2)
Crazy (Score:2)
Re: (Score:2)
I think I pay 10/mo for a small server. On it I run email and web.
That's the way to do it, at least until IPv6 with static IP's becomes standard. I do the same thing you do. I have a personal server and a small business server. I pay about $13/month for each. They only have 100Mb connections, but that is adequate for my needs.
Re: (Score:2)
Price hikes like that (Score:2, Interesting)
Re: (Score:2)
that's what I'm assuming. Their recent hike from $10 to $12 seemed entirely reasonable. And then this HUGE hike they just pulled off is just off the charts.
I gave up hosting my own mailserver a few years ago due to the obsessive mail server security hikes that basically made it impossible to host my own mailserver at my own house anymore. RBLs, certificates, etc. So I just gave up and went to Rackspace because their prices were reasonable. $10 a month for basically just an email is a bit high, but reas
They got bained (Score:5, Interesting)
It's a miracle they have survived this long. These price hikes are a hail Mary trying to soak as much money out of people locked into them as they can before they collapse under the weight of the debt.
Remember that every time private equity devours one of these companies it results in Mass layoffs. Even if you survive those layoffs there are now fewer jobs and more people looking for them and your boss knows that and best case scenario they stop giving out raises and bonuses and worst case scenario they fire you to hire somebody cheaper and they could care less whether that causes problems because they're just going to force everybody who still has a job to work three times as hard to solve those problems.
Capitalism is a complex machine and like any machine that requires maintenance. We stopped doing oil changes 25 years ago.
Re: (Score:3)
And here I thought a web hosting company getting bought out by EIG was bad enough. Turns out private equity can be even worse.
Re:They got bained (Score:5, Insightful)
Back in 2016 they got bought out by private equity and saddled with a shitload of debt paid out to the people who bought them.
Back in 2016, Rackspace had about $500 million in debt and $543 million in cash. By the time of the 2020 IPO, the debt had ballooned to almost $4 billion. Apollo collected about $200-300 million in management fees, plus another $600 million or so in debt-funded dividends (the vampire dividends). So, Apollo has recouped most of their initial $1.2 billion "investment." Of course, RXT stock has plummeted by about 95% since the IPO, so that suggests what the "value" of private equity "expertise" is worth.
It's sort of baffling how this type of business maneuver is legal. However, I imagine private equity has really good lobbyists.
Rackspace used to not suck... (Score:1)
In 2016, IIRC, they were bought up by an equity group. I used to have several domains with them for E-mail. Then they got hacked, as some email addresses which were never used on the Internet started getting hit by Rackspace phish attempts, looking like service that releases "sus" mail from quarantine. So, I could guess that something was phishy, and someone had a list of their users... that, or someone got it from my end.
Before that, Rackspace was jaw-droppingly awesome. They put serious training into
People used Rackspace? (Score:4, Informative)
When I started at a new job 15 years ago they were on rackspace...and it sucked. Spam/phishing detection was horrible, I'd spend 30 minutes every day just sifting through crap, and that was on a new email address. Boss had a 10yr old email address, that was way worse.
Couldn't get us off of it fast enough. Even gmail is better. I can't imagine how any business functions with them.
Ah, yes. (Score:1)
"The first fix is free." Now that you're hooked, bend it.
Why is email suddenly a big cost now? (Score:3)
I've noticed over the last eight months or so that a lot of large providers have made shifts in their service for email, and the services that are provided for email that kind of follow this path, in that suddenly it's become more expensive for them in some way and they typically either try to pass it on to customers or shift their operations around, etcetera, to make up for that, So I'm wondering and I'm asking flat out: The /. community please tell me what is going on with email that's making it so expensive to send outbound account status notifications so suddenly?
I haven't done anti-spam operations in a long time but it's weird because I'm getting signals that DKIM/DMARC is suddenly more expensive and I'm also getting signals that outbound email ops are suddenly expensive enough that It seems related, but I'm not sure what exactly is going on here. I wonder if this is just due to antispam operations getting so costly?
Can anybody else shed some light on this? Please?
Re: (Score:2)
I was similarly shocked at what people are asking.. Saw a thread on Reddit about using alternative email services, and one was charging something similar, about $10/mo Canadian per email account, and had relatively low storage.
And no direct interface - you had to have your own POP3 or IMAP client.
Google is also supposed to have shut down their POP3 downloading from other accounts via Gmail, but so far it's still operating (I use a few accounts for this.)
The really odd thing is it costs pretty much nothing w
Re: (Score:2)
My guess is greed. Hosting email today is not any more difficult or expensive than it was 5 years ago. I know this because I've hosted my own email since about 2002.
Anti-spam isn't more complex today than it ever was. I know this because I ran an email security company from 1999 through 2018 and I still use our anti-spam product, and it still works very well.
So yes. Greed.
Re: (Score:2)
I've noticed over the last eight months or so that a lot of large providers have made shifts in their service for email, and the services that are provided for email that kind of follow this path, in that suddenly it's become more expensive for them in some way and they typically either try to pass it on to customers or shift their operations around, etcetera, to make up for that, So I'm wondering and I'm asking flat out: The /. community please tell me what is going on with email that's making it so expensive to send outbound account status notifications so suddenly?
I haven't done anti-spam operations in a long time but it's weird because I'm getting signals that DKIM/DMARC is suddenly more expensive and I'm also getting signals that outbound email ops are suddenly expensive enough that It seems related, but I'm not sure what exactly is going on here. I wonder if this is just due to antispam operations getting so costly?
Can anybody else shed some light on this? Please?
I think most companies offering hosted email these days are just reselling the big bois, GMail or Orafice365-ish with their own branding at the top.
Hence they need to pay the provider then their own costs and hope to make a little profit at the end. As there's not much competition and running your own servers are even more expensive they can afford to jack up the price and undercut the resellers.
Pack up and run (Score:2)
Such drastic price hikes mean either: ...or the business is in serious financial trouble and is about to collapse. The hike ls are a futile last-ditch attempt to stay afloat. Never works. Export your data and run before it's too late.
1. Greedy management, potentially a new C-level prick on board, who's started monetising whatever they can to the max. You can be sure they won't stop where they are now.
2.
This is in line with other bought-out tech firms (Score:1)
Rackspace is right in line with Evernote.
Evernote 2024 Subscription $75.59
Evernote 2025 Subscription $140.39
Evernote 2026 Subscription $269.99
2026 Actual subscription cost: Joplin for free, Joplin cloud for €2.99/month
Can we just _PLEASE_ ... (Score:2)
... replace the E-Mail protocols already? Preferably with something not originating in the Jurassic Era of computing? And replace DNS right along with it. That would be great.
Re: (Score:3)
No.
Email is great. Everyone bitches about it, but nothing has come along to replace it and nothing will, because it has a unique set of features that no other messaging platform has.
Re: Can we just _PLEASE_ ... (Score:2)
It will continue to get used, but what it is used for has changed drastically.
I used to get regular emails from friends and family. I can't remember the last time that happened.
Currently, email is almost solely a unique identifier for business communication.
Even my work email is almost entirely automated notices telling me stuff happened on another platform used for communication.
And spam and scams.
Re: (Score:2)
I still send and receive lots of emails from friends and family. Could be my demographic as a late-50s Gen-X type.
The other main use is, as you say, as an identifier for logging on to various online services. My spam software blocks close to 100% of spams, which average about 5 per day... (241 spams in the period from 2025-12-05 through 2026-01-20) which is certainly nothing overwhelming.
Post-Office (Score:1)
100% prince increase (Score:1)