Do ESPs charge for dedicated IPs and how much do dedicated IPs cost?

Key findings

• Variable pricing: Dedicated IP costs range widely, from as low as $20 per month to as high as $500 per month, depending on the ESP and the services included.
• Add-on service: Many ESPs offer dedicated IPs as an extra service rather than including them in standard plans, often requiring an additional fee.
• Volume-based allocation: While charged per IP, the number of dedicated IPs assigned is often determined by a sender's estimated email volume to ensure sufficient capacity and optimal performance.
• IPv4 scarcity: The increasing scarcity and inherent value of IPv4 addresses contribute to why providers charge for them, a trend exemplified by major cloud providers like Amazon Web Services (AWS) beginning to charge for public IPv4 addresses.

Key considerations

• Cost versus benefit: Evaluate whether the additional cost of a dedicated IP is justified by your sending volume and specific deliverability needs. For some, a shared IP might suffice.
• ESPs' business models: Be aware that ESPs have diverse business models, and charging for dedicated IPs can be a revenue stream. Always clarify what's included in your chosen plan.
• Deliverability impact: A dedicated IP gives you more control over your sending reputation, which is crucial for high-volume senders, but it also means you are solely responsible for maintaining that reputation.
• Future of IP addressing: With the increasing charges for IPv4 addresses, there may be a push towards IPv6. Consider how this shift might impact email sending infrastructure in the future, as discussed by The Register.

Key opinions

• Common practice: Most ESPs charge for dedicated IPs, either as a direct fee or as part of a higher-tier package.
• Volume-based allocation: The number of IPs assigned is typically based on the estimated sending volume to ensure adequate capacity, even if only one IP is explicitly charged as an add-on.
• Varying charges: The cost for a dedicated IP can differ significantly across various ESPs, ranging from modest monthly fees to hundreds of dollars.
• Value perception: Many marketers view dedicated IPs as a worthwhile investment for managing their sending reputation and maximizing deliverability, particularly for higher volumes.

Key considerations

• Budgeting for deliverability: Marketers should factor in potential dedicated IP costs when budgeting for their email marketing efforts, especially if consistent high-volume sending is planned. Consider minimum send volumes that justify the expense.
• Trusting ESP allocation: When an ESP sizes IP allocations based on volume, marketers often need to trust that the provider is accurately assessing and provisioning the correct number of IPs for optimal performance.
• Impact on agencies: Agencies managing multiple clients may incur significant dedicated IP costs, prompting some to rebill these charges to their clients, as noted by HighLevel.
• Negotiation and research: It's advisable to research different ESPs' pricing models and negotiate terms, especially for high-volume senders, to ensure cost-effectiveness while maintaining deliverability.

Key opinions

• Historical context: Charging for dedicated IPs became more common when ESPs had to pay for IP ranges from providers, a model that largely continued even after ESPs obtained their own direct IP allocations.
• Market-driven pricing: Pricing for services, including dedicated IPs, often reflects what customers are willing to pay, rather than solely the underlying cost.
• IP scarcity and value: The increasing scarcity of IPv4 addresses is driving their perceived value, leading major cloud providers (like AWS) to begin charging for public IPv4s, which could influence ESP pricing models.
• Optimized allocation: ESPs typically size IP allocations based on estimated volume to prevent over-provisioning and ensure optimal deliverability, rather than simply charging per individual IP regardless of need.

Key considerations

• Evaluating ESP business models: It's important to understand that ESPs operate with diverse business models, and dedicated IP charges are a legitimate part of their revenue strategies.
• Long-term cost implications: Consider the long-term financial impact of recurring dedicated IP fees, especially as your sending volume grows and requires additional IPs.
• Adaptation to IP changes: The industry's gradual shift towards IPv6 and potential charges associated with it could introduce new cost factors and technical challenges for email infrastructure in the future.
• Value of reputation control: While there's a cost, a dedicated IP provides exclusive control over your sending reputation, which is invaluable for consistent deliverability and avoiding blocklists, a concept often discussed in depth by deliverability experts, for example, on Spam Resource.

Key findings

• Direct fees: Many ESPs, such as Amazon Simple Email Service (SES), explicitly state a monthly fee for leasing dedicated IP addresses.
• Add-on nature: Dedicated IPs are often presented as an optional add-on service, separate from the core email sending plans.
• Reputation control: Documentation often emphasizes that a dedicated IP allows senders to build and maintain their own sender reputation, which is key for deliverability.
• Eligibility requirements: Some ESPs may have specific criteria or minimum sending volumes that must be met before a dedicated IP can be allocated.

Key considerations

• Billing cycles: Be aware of the billing cycle for dedicated IPs. Some may be billed monthly, while others might require annual commitments, affecting upfront costs.
• Pro-rated charges: If a dedicated IP is leased mid-month, charges might be pro-rated, as seen with services like AWS SES. Confirm these details with your ESP.
• Setup and configuration: ESPs typically provide documentation on the process of setting up and configuring a dedicated IP, which can take a few days.
• Deliverability responsibility: Documentation highlights that with a dedicated IP, the sender becomes directly responsible for managing its reputation and avoiding blocklisting (or blacklisting).