- Rackspace Standard Plans now cost $10/month, down from $3
- Laughing Squid faced a 706% price hike and six weeks’ notice
- Additional fees will be used to maintain the quality of service
Rackspace’s customers and long-standing partners have warned the changes could be “devastating” following a sharp rise in prices for the company’s email hosting.
The standard plan now costs $10 per mailbox per month, up from $3. Fees for the Email Plus (+$2, from +$1) and Archiving (+$6, from +$3) add-ons have also put additional pressure on customers.
A number of partners have reported increases ranging from 110% to almost 500%, and volume discounts don’t appear to be there to soften the blow.
Rising prices for storage space
One reseller, Laughing Squid, claims its prices rose 706% with just six weeks’ notice. Founder Scott Beale explained (via Ars Technica), this email now represents Laughing Squid’s largest operating cost, adding that previously negotiated volume discounts appear to have been removed.
Rackspace defended the increases, emphasizing that the revenue is necessary to maintain quality of service and promising a commitment to secure, business-class messaging.
“After nearly 27 years of using Rackspace as your email provider, they suddenly announced that they were increasing our email rates by an astronomical 706%,” Laughing Squid noted in a blog post. “There have been reasonable price increases over the years, as expected, but nothing like this.”
The company also works with PolarisMail to reduce costs that would otherwise be passed on to customers.
“To continue to provide the service levels our customers expect, beginning in March 2026, Rackspace Technology is increasing the price of Rackspace Email. We have a support team available to help our customers discuss their options,” shared a Rackspace spokesperson.
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