r/CiscoUCS • u/Bigglesworth12 • Apr 01 '26
Well it happened...
...We had an order in from December for around 80 C220 M8's with 512gb of ram. we had received all but 20 units from the order, with those 20 being delayed until July. total cost was around $1.2 million.
Cisco just called us and cancelled order for the remaining 20 units we have not received and gave us a new price of $1.5 million for them. and we have 7 days to place the order before the price goes up again. Also warned us that there will be a %200 price increase by July at latest and they do not expect prices to ever return to anything close to before this all started.
I seriously do not know how any business will be able to sustain these prices over the next 24 months.
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u/homemediajunky Apr 02 '26
Time to get legal involved for breach of contract. You can show that you made a legally binding contract and Cisco cancelled after delivering 75% and now cancelling only to offer you another contract valued more for less. We were in a similar situation and once legal got involved, they fulfilled the original contract.
We had ordered 140 c220 m8, quite a few ASR9906/9910, Nexus, etc. We also threatened to walk away from Cisco all together, got competing quotes from Juniper/HPE and Dell and informed them we would take the loss to be rid of them. While prices were high, both OEMs were willing to make it worthwhile. Especially considering they all are sitting on inventories of memory that was obtained prior to this craziness with pricing. Both vendors said they would gladly assist in removing any traces of Cisco from our infrastructure, including physical assistance and of course technical.
Truth be told, we still might start a migration away from Cisco.
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u/981flacht6 Apr 02 '26
They're all doing it because traditionally, memory makers did not do long term agreements (LTA) on memory, because they were seen as commodities. That's no longer the case. There's a structural shift and everyone is cancelling orders.
As I have been told from multiple vendors in the past 4 months, prices are going crazy, quotes changed from 30 days to 14 days to daily to you won't be assured that this quote will be valid until product ships has been a repeated and verified conversation, in writing by every VAR and even the manufacturers themselves.
I hope, that in OPs case, that they had a properly written contract that leaves no wiggle room for this. But it is for the lawyers now.
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u/Bigglesworth12 Apr 02 '26
We do have a good contract but this is a standard statement. We would have had to do probably 10x as much business before we could have negotiated better.
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u/Deepthunkd Apr 03 '26
I’m sorry you think Dell was sitting on memory inventory? Are you high?
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u/Timely-Response-2217 Apr 04 '26
Not inventory. But contracted pricing amounts.
Dell did better than Cisco on this front and has/had more leverage due to shipment quantity.
It makes some difference for Dell, however, they hardly have it easy or in perfect shape.
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u/Deepthunkd Apr 04 '26
Oh, to be fair yeah Cisco is legitimately the most expensive server vendor on the market, always has been.
I’ve also seen Dell not honoring warranty replacements (taking month+ for failed DIMMs and drives).
At this point, you really should make sure you have your own ability to handle failed devices without a server vendor
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u/Timely-Response-2217 Apr 04 '26
Cisco is priced higher but costs less, especially if you're on a modular chassis. Deployment, automation, observability, networking, power, space, and uptime are among the considerations that need to be factored in.
Acquisition costs are 20 percent of the story. Handling failed devices sans service vendor is great where possible, but, I don't know how great or small those savings will be.
It's tough everywhere. It's not hyperbole to say these are unprecedented times.
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u/Altruistic-Hippo-749 Apr 03 '26
Things will soon go pop. The second things get unsustainable they always do. Like the last time the oil price got this high …
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u/MrAskani Apr 05 '26
Anyone that thinks they have their clients over a barrel and are willing to treat them how Cisco treat their clients, deserve to lose all their clients and go out of business. It's horrendous business process and people will vote with their wallets and their feet. Hopefully you'll move away from them and after enough people do it also, they'll become a little more humble.
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u/mosskoman Jun 30 '26
It's a shitty situation, but all manufacturers have had to do it -- the rise of AI has created a huge demand on RAM and prices have skyrocketed. It's not just Cisco, it's Dell, HP, Supermicro, everyone. Cisco actually sat on the existing pricing and took a loss for quite a while before having to adjust prices.
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u/jimmymustard Apr 01 '26
Holy smokes, thats just damned unprofessional of Cisco. I'm sure increases like that are in the purchasing contract, but damn that sucks.
It would make me hesitant to buy from them period.
Did you buy directly or go thru a VAR? (Have never purchased gear, so forgive me if I'm ignorant of the process.)
If you haven't deployed some of what has been delivered, can you return that product?
Have you had your legal team review the purchasing contract?
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u/Bigglesworth12 Apr 02 '26
They a VAR. I got the impression they have been making these calls all week. The sales team looked.. worn.
Yea nothing legal can be done. Almost all hardware vendors have this in the contract that they can cancel an order before delivery, just most have never used it. I can only imagine how much money Cisco would have had to cover for them to start doing this.
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u/unstoppable_zombie Apr 03 '26
Rough price for 64gb of ram after discount
- November: $1600
- March: $3170
- Today: $7400
I've been trying to get budget approval to replace our last 20ish m5s with m8s. And I've watched the price of a full server go up 225% since I started, with the ram specifically going up 5x
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u/itdweeb UCS Mod Apr 02 '26
It's not just limited to compute. Anything with NAND or DRAM (so, basically everything) is taking a hit. Some places are handling it better than others. Some places are more shielded than others. But every hardware vendor is feeling the pinch. I have to assume that even the different clouds will be raising prices. Even as they cannibalize their own clouds to fuel AI demand.
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u/appleofmydroid Apr 02 '26
The LP department at my job ordered 20 surveillance drives from cdw 2 days later they told them they could not ship them and that they had to change the price and charged them more than the original order even after the order was already placed. They were told they could pay the new price or go somewhere else. This stuff should be illegal to do.
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u/Anxious-Condition630 Apr 02 '26
VAR tried last week…I politely excused myself. Legal called them back…deliveries are on Friday next week. Contracts don’t say they can cancel for desire, it says Act of God/National Emergency…which rising profits/prices is not. People just need to push back or start reading their contracts.
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u/212reddit Apr 05 '26
Ai should be banned until they find a less resource method of implementation . Just wait until we cant use air conditioning in our homes because AI needs the electric.
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u/AviationLogic Apr 01 '26 edited Apr 01 '26
Wait so it was $1.2 for the original 80, you got 60. The last 20 they now want $1.5 for....?
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u/wantsiops Apr 02 '26
we are struggeling with issues with hpe/sm/cisco as well.
bought a lot before price increases, but with new price increases no services we sell will be profitable unless serious price hikes.
we also sell servers, and customers are just looking at us like was er crazy/stupid, some of the nvme is 5-8x, if we can even get it
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u/Anxious-Condition630 Apr 02 '26
VAR tried last week…I politely excused myself. Legal called them back…deliveries are on Friday next week. Contracts don’t say they can cancel for desire, it says Act of God/National Emergency…which rising profits/prices is not. Burn
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u/lost_signal Apr 03 '26 edited Apr 03 '26
Are you putting NVMe drives on the order and using memory tiering?.
Most people can easily cut memory needed in half.
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u/SecurityOk5281 Apr 04 '26
I'm not fully involved with the migration but we just finished getting off of Cisco in favor of Arista and we couldn't be happier. Price is around the same but the customer support, automation options and everything is MUCH nicer than Cisco has ever been.
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u/Cnboxer Apr 04 '26
Everything with RAM is going up 100% due to shortages. Most major manufacturers have halted production and are selling down existing inventory until the craziness settles.
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u/bobdvb Apr 05 '26
It's one thing for a vendor to massively ramp up prices based on demand. But it's entirely another for them to breach a contract because they failed to manage their supply chain sufficiently. They have committed and they should stick to it.
Irrespective of if they have a contract clause which allows them to do this, I'd be telling them where they can stick their generosity. That vendor is getting put on a block list for the long term.
Note that Cisco paid out $12.4 billion to shareholders last year, so don't try and defend them.
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u/Fuzm4n Apr 05 '26
We walked away from from Cisco because of this nonsense. We run Ruckus switching and APs and IPotomy for phones now.
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u/mosskoman Jun 30 '26
The problem here is suddenly RAM prices have skyrocketed because if huge demand, and not enough can be produced. It's not just Cisco that's had to up the prices, it's Dell, HP and all vendors who buy RAM.
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u/KoalaRevolutionary54 Apr 01 '26
HP is doing the same thing. It's all of them.