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 marks a substantial change from Rackspace's pricing in 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 (for file storage, mobile sync, Office-compatible apps, and messaging) and Archiving (for unlimited storage), now cost an additional $2 and $6 per mailbox per month, respectively. Previously, these add-ons were priced at $1 and $3 per mailbox per month.
Reseller partners have voiced strong concerns about the impact of the new pricing. Laughing Squid, a web hosting service provider and Rackspace reseller, stated in a blog post on Thursday that the company is increasing our email pricing by an astronomical 706 percent, with only a month-and-a halfs notice.
The price hike affects businesses that rely on Rackspace for email hosting, potentially forcing them to absorb the increased costs or seek alternative providers. The suddenness of the change, as highlighted by Laughing Squid, adds to the challenge for businesses needing to adjust their budgets and IT strategies.
Rackspace has not yet issued a public statement addressing the concerns raised by its partners and customers. The long-term effects of this pricing change on Rackspace's customer base and market position remain to be seen.
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