Rackspace customers are facing a significant price increase for email hosting services, with some partners reporting increases as high as 706 percent. The new pricing structure, implemented in recent weeks, sets the standard plan at $10 per mailbox per month.
This represents a substantial jump from Rackspace's pricing as recently as November 2023, when the standard plan cost $3 per mailbox per month, according to data from the Internet Archive's Wayback Machine. Add-ons such as Rackspace Email Plus, which includes file storage, mobile sync, and Office-compatible apps, now cost an additional $2 per mailbox per month, while the Archiving add-on, offering unlimited storage, costs an extra $6 per mailbox per month. Previously, these add-ons were priced at $1 and $3 respectively.
Reseller partners, who offer Rackspace services to their own customers, have been particularly vocal about the impact. Laughing Squid, a web hosting service provider and Rackspace reseller, published a blog post on Thursday stating that Rackspace is increasing our email pricing by an astronomical 706 percent, with only a month-and-a halfs notice.
The price hike has forced many businesses to re-evaluate their email hosting solutions. The sudden and significant increase has left some partners scrambling to find alternative providers or absorb the cost, potentially impacting their own profitability and customer relationships. The reasons behind Rackspace's decision to drastically increase prices remain unclear. The company has not yet issued a public statement explaining the change. The situation is ongoing, and the long-term effects on Rackspace's customer base and market position are yet to be seen.
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