If most of the installs are on servers, have you considered talking to server providers about setting up internal mirrors on their networks? That might save everyone a lot of bandwidth.
Of course, people shouldn't really be installing their gems from ruby gems on servers anyway, is there any way to prod bundler to make it default to package gems and do a local install where possible, rather than downloading them every time there is a deploy (the current default)? At present you use double bandwidth from people downloading once on their local machine, and once on their server to update.
Fetching the ruby gems index with bundler/rubygems still takes a while every time I bundle update, have you looked at optimising that part of the process further (at least it doesn't fetch a list of all gems now, but it still fetches a list of all versions of each gem doesn't it?), say caching older gem results? The list of gem versions available should not change for old ones, so you should really only need to fetch a very small list of latest versions. The memory usage and bandwidth usage is still quite high there.