Compute vs bandwidth
For always-on APIs the instance hours usually dominate, with egress a smaller slice.
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API & Backend Cost
API Hosting Cost Calculator
Estimate the monthly cost of hosting your API on always-on servers. Enter instance count, hourly rate, run hours and bandwidth, and see compute versus bandwidth in one view.
Estimated monthly cost
$0
Compute cost—
Bandwidth cost—
Cost per instance—
Effective hourly (all)—
Annual estimate—
What the API Hosting Cost Calculator does
Hosting an API on dedicated servers means paying for compute by the hour whether or not requests arrive, plus bandwidth for the responses you send. For a steady, always-on service this often works out cheaper than per request pricing, which is why many teams run their API on a small fleet of instances.
This API hosting cost calculator multiplies your instance count by the hourly rate and run hours to get compute cost, adds bandwidth egress, and shows the split so you know whether compute or data transfer drives your bill. A full month is 730 hours if you run around the clock.
Heads up on pricing. The rates built into this tool are public list estimates for July 2026 and can change without notice. Providers also offer batch discounts, prompt caching and volume tiers that lower real costs, so treat the output as a planning estimate, not a quote.
The formula
compute cost = instances × hourly rate × hours per month
bandwidth cost = data out (GB) × egress price
total = compute cost + bandwidth cost
bandwidth cost = data out (GB) × egress price
total = compute cost + bandwidth cost
Worked example
Two m5.large instances at $0.096 an hour for 730 hours cost 2 × $0.096 × 730 = about $140. Add 500 GB egress at $0.09 for $45, and hosting is roughly $185 a month.
Ways to lower your API and backend costs
- Serve responses through a CDN. Cached, edge-delivered responses cut egress cost and take load off your origin.
- Compress payloads. gzip or brotli plus trimming unused JSON fields reduces bandwidth on every single request.
- Cache common responses. Avoid recomputing identical results for repeated reads, which lowers both compute and request fees.
- Reduce chatty designs. Combine several small calls into one batch endpoint or a single GraphQL query to cut request volume.
- Right size and autoscale. Match capacity to real peak traffic instead of paying for servers that sit idle most of the day.
Frequently asked questions
How much does it cost to host an API?
A small two instance setup often runs $100 to $250 a month including bandwidth. It scales with instance size, count and traffic. Enter your setup above for a figure.
Is dedicated hosting cheaper than serverless?
For steady, predictable traffic, always-on instances are usually cheaper per request. For spiky or low traffic, serverless avoids paying for idle capacity.
How many hours are in a month?
About 730 hours for a 24/7 service. If you run only during business hours, reduce the hours to match.
How do I cut hosting costs?
Right size instances, use reserved or committed pricing for steady load, autoscale to match demand, and serve bandwidth through a CDN.
Are these rates current?
They are 2026 estimates. Confirm instance and egress pricing with your provider and region.