Maybe. And I'm curious to find out exactly how good the performance and connectivity of these boxes is compared to DO boxes, especially at these attractive prices. But these rather large per-box setup fees are a clear deterrent for a cash-strapped startup to even try things out.
I'm a customer of both and the author of two rubygems (one for the Hetzner API, one for the Digitial Ocean API). From my experience Hetzner is 10x faster, more reliable and more professional.
e.g. no changes to production APIs without notice, no radical product changes (as seen with NL based vservers at DO) and much more.
If you're looking for something in the US, you probably want to go with DO but for Europe only OVH can beat Hetzner (only sometimes). Both offer 1Gbit/s uplinks and direct connection to the largest and most important CIX in Europe (http://de-cix.net/)
Hetzner and OVH are no startups burning money anymore. They make huge profits and are in business for over a decade. They know how to build, operate and scale things efficiently. They will not be gone in a couple of years. They are not as fast in providing "new stuff" (think of OpenStack IaaS/a Cloud Platform like AWs) but I bet this will change, too.
They stopped provisioning some of them for a couple of weeks. no word on their status and/or offer page. API calls just failed. Turns out that they ran out of IPv4 space but were not able to communicate that to their customers in a professional manner.
No, the problem is I don't need decent response-time everywhere in the world. I need decent response time in California. That's where the majority of my visitors are from. Latency is the tradeoff you make when you buy overseas servers to save money.
Most startups choose AWS for their hosting, where they're paying a ~10x premium over dedicated boxes. Budget obviously isn't the deciding factor even for cash-strapped new tech companies, not when we're talking about just 100EUR.
Cash-strapped startups are not choosing DigitalOcean, they're choosing AWS. That's their point of comparison. Your assertion was that 100EUR would be a barrier to startups, not just to yourself.
Off-topic but do you get mistaken for the lecturer Dan Grossman? Especially around here since he did a coursera functional programming course earlier this year?
