A few things other people don't seem to be mentioning: 1. RAM prices can be quite volatile, while hosting prices generally are not. Hosts may have taken lower

A few things other people don't seem to be mentioning: 1. RAM prices can be quite volatile, while hosting prices generally are not. Hosts may have taken lower margins back when their RAM costs were higher that they are now trying to recoup. At the very least, they aren't in a hurry to cut prices right now because their costs could go back up again if the economy picks up and RAM prices head upward. 2. Hosting is basically a subscription business model. Subscriber acquisition costs are balanced against total lifetime value of the average subscriber. A host may take a lower margin, or even a loss, in the first stretch of a hosting relationship and treat that as part of the SAC in anticipation of their margins improve over time thanks to declining costs due Moore's law.