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View Full Version : What does it take to start a Web Hosting Biz?


Lookn4Money
07-07-2003, 01:18 PM
Hi every body. I am new and just arrived!

I am collecting data about web hosting business.
I wonder if someone can help me in one point: What minimum connection speed one needs to start with? Say for 10 to 100 sites?
Is it enough to subscribe to a 256 Leased Line?
Where can you find some articles about this issue.

dbbrock1
07-07-2003, 01:33 PM
Don't even bother buying your own line. If you have the technical abilities, go with a dedicated server at rackshack.net or dedicatednow.com

EDIT* Add theplanet.com to the list.

Patrick
07-07-2003, 04:19 PM
Originally posted by Lookn4Money
Hi every body. I am new and just arrived!

I am collecting data about web hosting business.
I wonder if someone can help me in one point: What minimum connection speed one needs to start with? Say for 10 to 100 sites?
Is it enough to subscribe to a 256 Leased Line?
Where can you find some articles about this issue.

This has been discussed way too many times, please use the search feature and read the other million threads about this.

Personally, and this is just my opinion, if you are asking on how to start a web hosting business, you shouldn't be trying to start one.

Too many people get into the web hosting business with little to no knowledge of anything important relating to the services that they are offering. It's a real sad situation.

Lookn4Money
07-07-2003, 04:59 PM
Thanks Pat

Actually I do have a great experience doing hosting using others services. I don't have any problem using all software programs used in windows servers.
What is knocking on my head is why I do have to pay for every hard disk I as to add to a dedicated serve? Why I have to put my nick within their precisely counted bandwidth? etc..
So I need to have some FREEDOM.
I can install all hardware (cheap theses days) without adding any monthly costs.
You got my point.
So, I wondered if I want to run my own computers using some connection of some sort (Satellite say).
It is not so expensive to get some Sat-Providers of 1 Mbps speed
I only wonder, How many sites one can host for such a speed?

kylec
07-07-2003, 05:13 PM
you cant host websites on dsl or satellite or cable internet! way to slow.

minimum would be to get a t1 line. you could host ~50 very small sites on a T1

or consider collocation of your own hardware!

Patrick
07-07-2003, 05:26 PM
Originally posted by Lookn4Money
Thanks Pat

Actually I do have a great experience doing hosting using others services. I don't have any problem using all software programs used in windows servers.
What is knocking on my head is why I do have to pay for every hard disk I as to add to a dedicated serve? Why I have to put my nick within their precisely counted bandwidth? etc..
So I need to have some FREEDOM.
I can install all hardware (cheap theses days) without adding any monthly costs.
You got my point.
So, I wondered if I want to run my own computers using some connection of some sort (Satellite say).
It is not so expensive to get some Sat-Providers of 1 Mbps speed
I only wonder, How many sites one can host for such a speed?

You might want to go the co-location route. Perhaps find a good data center local to you, that way you can manage your OWN hardware and add hard drives without having to pay any additional fees.

Keeping in mind co-location is a bit more expensive, and you will still have to pay for bandwidth, but if you're looking for more freedom over your hardware.. this is what you want.

You can't use a Satellite to host websites, why?

1) You still need a DIALUP modem to send data back.

2) The latency would drive your customers nuts.

3) Not very reliable.

Patrick
07-07-2003, 05:29 PM
Originally posted by kylec
you cant host websites on dsl or satellite or cable internet! way to slow.

minimum would be to get a t1 line. you could host ~50 very small sites on a T1

or consider collocation of your own hardware!

I have a 5 Mbit up/down business cable connection, and it's VERY fast!

Although, I would never host paying clients off of my cable connection for obvious reasons. (I don't live in a data center, well.. not yet anyway. :)

Lookn4Money
07-07-2003, 05:47 PM
Well, just a little correction
the two-way Satellite is so fast (could be 2 Mbps), and reliable (uptime could exceed 99%), and no need for dial-up.

marksy
07-07-2003, 06:14 PM
You can take the advice of the people here who have success in hosting - or continue to insist you can do it with much smaller bandwidth and see how far you get. I'd recommend listening to the voice of experience here and colo somewhere if you're serious about hosting. It's certainly been done before on DSL and satellite, but not by anyone who make a living at it, or anyone who has done it for any length of time with success.

thedavid
07-07-2003, 07:08 PM
Originally posted by Lookn4Money
Well, just a little correction
the two-way Satellite is so fast (could be 2 Mbps), and reliable (uptime could exceed 99%), and no need for dial-up.

Think latency though. When someone goes to view a site on the server, it's going to go from wherever they are, over to the sat uplink, to the satellite, down to the server, back to the satellite, back to the sat uplink, and finally sent back to the internet. That's going to be absolutely horrible.

You've already been given the best option if you want to 'own' the hardware - colocation in a datacenter.

-David

achost_ca
07-07-2003, 07:48 PM
Colocation is best option. We just moved our primary server into colocation with Tera-byte.com today. We looked at all the costs, and they worked out to be the best option, even though they are a 3 hour drive away from our office.

AF
07-08-2003, 04:05 AM
Hi Lookn4Money. I don't want to sound rude but you don't seem to have any knowledge on Web Hosting.

If you can assure 99% uptime for 50 clients on your 256 connection I would be shocked.

If we all or at least the majority of people here uses Broadband connections (~512+) and sometimes is not sufficient, how the hell would you host 50 sites on 256 ? Even with T1.... not possible to have a good business with it I think (at least from your home).

Consider getting colocation or a dedicated server, since it is not that expensive anymore.

But why don't you start with a Reseller Account ?

- Andre

JustinH
07-08-2003, 04:13 AM
Originally posted by kylec
you cant host websites on dsl or satellite or cable internet! way to slow.

minimum would be to get a t1 line. you could host ~50 very small sites on a T1

or consider collocation of your own hardware!

Yet another person who thinks they know what they are talking about...

Connection speed is relative to what you actually need. Starting out, you're not going to need much of anything. The problem with hosting from home isn't the downstream connectivity... it's 2 things:
Backup
Upstream

First of all, backups are a neccessity in this industry, and unless your phone company is throwing in a free local loop and multi-homed DSL your out of luck :D. Without that, if your connection goes down for any reason, your sites go down. On top of that, the majority of broadband providers give CRAP for upstream (talking cable internet here). Which could also cause problems... in other words, your best option is to get a reseller account and "learn as you go". Pick a company with a GREAT customer support team, willing to work with you and you'll pick it up in no time.

DevilDude
07-08-2003, 04:35 AM
If you think you can do it from home on your own server (not colo), please dont start.

IMO, rent from RS or start with a resellers account.

I think resellers is the best to start ;)

kwes43
07-08-2003, 05:38 AM
If you are going to be hosting 50 or so freinds and family and that's it - and you do not consider this a business, then by all means host from your house. You do not need to know how to run a hosting biz for that, you can just gather information in the tech forum on how to set up your own server. There is loads of info around the net too.

If you are looking to start a business, please realize that there is much more to it then meets the eye initially. People will be depending upon you for their online prescence. Their businesses will depend on you--which means many people lives will be affected by you.

If you don't have the skills or the business plan to set up a high-quality, reliable hosting service, then don't start one up at all. We do not need any more unreliable hosts in this world and why would you want to become one anyway? There are many other businesses to start.

Start by analyzing your skillset and deciding what type of business you can start that you will be able to run at high-quality and will get you where you want to go-this will save you a lot of potentially wasted time down the road.

Just remember, you need to have a system in place that can handle all the problems involved in hosting. What happens when a new customer of yours loads a bad php script that kills apache. Meanwhile on the same server, one of your other customers just spent $1000s of dollars on an advertising campaign to get people to their site. Now their site is down--and they were depending on that traffic. Are you going to be able to fix that problem quickly and efficiently? This is just one example of many things that can go wrong everyday, all day, 365. If you can't provide what you offer, don't offer it.

If you are still looking to start a hosting company, many of these problems can be alleviated by becomming a reseller. Then you won't have to worry about dealing directly with the hardware and software issues on the server. Just make sure you find a reputable host to get your reseller account from because their downtime means your downtime. Search the forum, you can find some good hosts with great reseller plans around here. This will allow you to concentrate on marketing, customer service, and tech support if that is more your skillset. Even with reselling though, people will still depend on you as their first point of contact--if they can't reach you they will be lost.

So, I apologize that I was so long-winded here, but to wrap it up--the hosting business is like any other business, in fact I can think of 100s of other opportunities that are much easier and less time-consuming--just remember that before taking the plundge...and if you do good luck and I hope to see another quality host out there:)

FHDave
07-08-2003, 06:12 AM
Originally posted by Lookn4Money
What does it take to start a Web Hosting Biz?


two years of research and planning. That's how I started mine.

ljprevo
07-08-2003, 09:45 AM
I hate to be a swine here, but why do I get the sense that everyone and their mother thinks that being a web host is a "Get Rich Quick" business?

Look at the original posters name. "Lookn4Money"

I am sorry to spoil the day for the poster and any other person who wants to jump into the hosting business, but there is actual work involved here.

Us established web hosters know the time and headaches that go into being in this business.

If you are serious and want to take a stab at this, then yes go for it, but don't think it is easy and a way to get rich quick.

thedavid
07-08-2003, 11:28 AM
Originally posted by ljprevo
I hate to be a swine here, but why do I get the sense that everyone and their mother thinks that being a web host is a "Get Rich Quick" business?

Look at the original posters name. "Lookn4Money"

I am sorry to spoil the day for the poster and any other person who wants to jump into the hosting business, but there is actual work involved here.

Us established web hosters know the time and headaches that go into being in this business.

If you are serious and want to take a stab at this, then yes go for it, but don't think it is easy and a way to get rich quick.

Agreed. It took us a *long time* before we even considered doing this stuff ourselves. Sure, it looks easy, just throw a server on the internet and money starts rolling in, right? Wrong.

We spent many months just reading this forum and 'lurking', while we worked at other web hosting companies before we even started, or even registered an account here for that matter. Even then we didn't know just how much work it was going to be.

Stuff to consider before even opening:
Equipment choices (like this original posting)
Software choices
Target Markets
Business Plans
Taxes/Accounting
Policies
Support handling and grade of service
Sole Proprietership Vs. Partners
Customer Billing
Account Plan Strategies
Service Monitoring
And a bunch of other things I can't think of off the top of my head.

It is a lot of work, but if you're willing to put a lot into it this can be a rewarding job.

-David

achost_ca
07-08-2003, 11:32 AM
I Agree. We spent many months, probaly almost half a year just planning before we even said 'lets do this'. Then it took another several months before we were confortable with what we were offering before we actually started marketting it. It takes a lot of planning and research, but I agree, it can be a very rewarding job in the end.

Nymix-CB
07-08-2003, 11:49 AM
achost_ca is right. It takes a lot of time. We didn't do a business plan at the beginning but now we got it with our priority list.

We know what and when to buy this etc. It's a long-time business.

THW-Dave
07-08-2003, 11:50 AM
Originally posted by kylec
you cant host websites on dsl or satellite or cable internet! way to slow.

minimum would be to get a t1 line. you could host ~50 very small sites on a T1

or consider collocation of your own hardware!

Your basing that off of what?

we use a T1 here, we have many high-end sites, and a few dedicated boxes, a few colocation clients, and way more than 50 shared accounts.. we dont even use 4% of our T1..

good day

ljprevo
07-08-2003, 12:18 PM
Oh, I am not saying it is not rewarding, it sure is. Esp. after a server crashes and your backups worked. :D

I didn't go bald naturally, the time I sat for hours to make sure the server is restored before I leave the computer screen.

Imagine a guy with both hands gripping his hair on both sites.

Waiting.... Waiting... Waiting...

The restore took.

Then imagine a happy smiling guy with to lots of hair standing up on each side of his head. :D

Seriously. I did just as you all did, kind of.

I had about 20 sites I designed and had a reseller account. I then got a server and played around and learned with it for a year until I started web hosting. It has been a lot of time, learning, etc.

In the end it was rewarding, but a new porshe has not come with it.

There is so much competition the web hosting that it is a long term business and to make money quick with it will not wash.

You have to have customers and they have to be ones that will stay with you and trust you to begin to make any kind of money.

SmashData
07-08-2003, 01:36 PM
Originally posted by Lookn4Money
Well, just a little correction
the two-way Satellite is so fast (could be 2 Mbps), and reliable (uptime could exceed 99%), and no need for dial-up.

The above statement is a joke right? I have the 2 way system. Downloads are around 1.2mbps and uploads are lucky if I hit 100K. And I have performed all the TCP/IP tweaks necessary to get the biggest speed possible, never mind the fact that satelitte has a latency up over 1000ms. Your customers would quit before they even started. If you don't believe me head over to www.copperhead.cc for the "real" statistics on satelitte. Oh and your capped on your downloads, you can't download more than 169MB in a certain period...........so if you work the numbers, you can only sustain traffic of around 7k on the satelitte non - stop and not have your connection dropped.

Get a dedicated, it's cheaper than co-location in the long run.

Oh and satelitte uptime is nowhere close to 99%. I still have to dial out all the time.

dynamicnet
07-08-2003, 01:43 PM
Greetings ljprevo:

"I hate to be a swine here, but why do I get the sense that everyone and their mother thinks that being a web host is a "Get Rich Quick" business?"

I had the pleasure of being a part of a four person panel discussing hosting myths and legends at Web Hosting Magazine's 2000 Web Hosting Exposition in Washington, DC.

One of the myths that came up is that you can just quit your day job, start a hosting business, and become rich overnight.

We've been in the business eight years now, have our own office, and full time staff; and, yet when I talk to my counter parts at non-hosting companies about comparative salaries, they are all aghast at hearing what I make compared to what they make.

It took five of those eight years to have a salary comparable to what I was making in 1995 (for those that don’t like date math; it wasn’t until the year 2000 that I had a salary slightly better than what I had in 1995); and, even now there are those who have scope and depth of work to do, and are paid $10,000 to $60,000 per year more than I.

And that’s fine for me since I didn’t start the business to get rich (quick or slow <smile>).

However, I’m still mystified over those that believe you can start your own hosting business, quit your job, and keep the same life style they may have had under the income level of the job they quit.

And to make matters more mystifying, most of those thinking they can get rich quick or otherwise have an easier life than whatever day job they have now (or had), they believe they can do so by having bottom feeder pricing and overselling like crazy <sigh>.

In ending, I think only the hard lessons of life will help those who believe they can get rich quick from hosting educated as to the realities of the business.

Thank you.

marksy
07-08-2003, 01:54 PM
I imagine they get the idea from the ridiculous pricing I see here every day. You can get rich quick suckering people in with c-yberwings b.s pricing and then declaring bankruptcy and doing it again. You can start as many Corps as you'd like - We've all seen the get rich quick guys come and go and come and go etc...names float around all the time.

developer
07-08-2003, 06:58 PM
Originally posted by FHDave
two years of research and planning. That's how I started mine.

What did you do during these two years please?

kylec
07-08-2003, 07:39 PM
Originally posted by thehostworks
Your basing that off of what?

we use a T1 here, we have many high-end sites, and a few dedicated boxes, a few colocation clients, and way more than 50 shared accounts.. we dont even use 4% of our T1..

good day

1.54/8 = ~192.5kb/sec / .04 = 7.7kb/sec

thats insane, 4% hu? :eek: maybe you should put each server on a dial-up connection since you are only using 7.7kb/sec across all your servers. :D

a T1 can do about 440 GB

so you are pushing less than 17.6 gig a month? between your more than 50 shared hosting plans, high end sites, dedi boxes, and colo boxes?

please don't lie, it miss informs the newbies and inflates your false ego.

-Kylec

ljprevo
07-08-2003, 08:04 PM
Originally posted by kylec
1.54/8 = ~192.5kb/sec / .04 = 7.7kb/sec

thats insane, 4% hu? :eek: maybe you should put each server on a dial-up connection since you are only using 7.7kb/sec across all your servers. :D

a T1 can do about 440 GB

so you are pushing less than 17.6 gig a month? between your more than 50 shared hosting plans, high end sites, dedi boxes, and colo boxes?

please don't lie, it miss informs the newbies and inflates your false ego.

-Kylec

Sorry, your math did not add up here.

T1 = 1544 k

1544 k * 4% = 61.76 k

Which is still low compared to what they say they have on that line

achost_ca
07-08-2003, 08:06 PM
Actually his math did add up. T1 is 1.54 megabit, not megabytes.

You calculated his bits, not bytes. Which is still pretty small. However you should also account for thats what it may average. Perhaps his servers are fairly busy all day, and dead at night? or suffer peaks at certain times where it bursts higher then the average?

kylec
07-08-2003, 08:09 PM
Originally posted by ljprevo
Sorry, your math did not add up here.

T1 = 1544 k

1544 k * 4% = 61.76 k

Which is still low compared to what they say they have on that line

Watch your lowercase and uppercase :blush:

it would be 7KB/sec and 61.76kb/sec (notice upper/lowercase)

those lowercase, uppercase things always get me to!

-kylec

Andy/Toronto
07-08-2003, 09:08 PM
1Mbps = 320GB of data transfer/mth

It is great to see the entrepenuer spirit is still alive and well...at least according to the new guy on the block

There is always a way to do well in business...

I believe that good business is a two edged sword you must learn to swing with fearless determination....even if you lose a few times while learning.

One edge of the sword is your costs and your retail pricing...not everyone wants the cheapest thing on the block...if fact many avoid them like the plague.

You get what you pay for?....learn this one well!!!!
Ping times...uptime...packet loss...backups....

Deliver on these issues at all cost, and you will keep your clients, as well as get new ones.

Deliver your product to market at competitive prices by finding the cheapest wholesale prices.
pricewatch.com is good for the beginner

Later, get in with the manufacture reseller accounts with bulk purchasing....the more you buy...the cheaper it is
This is especially true of bandwidth.

The other edge of the sword is your professional conduct with your clients....you must learn this to not only succeed...but to feel good about your company.

Do not listen to the fear mongers....they waste their time and yours.
There are many wonderful success stories out there!
Like all the companies on the Nasdaq 100
Look and listen to the tone these companies have, and embrace it.
The single most common thread that top flight performing companies, share in common, is the individuals who started the company, and who continue to run them, truly love what they do....
It is not a matter of winning or losing...it is about helping other companies succeed with your value added product or service.

If you fail at one...find an new one...be flexible, and not afraid to change.
You should know before you start if you will make money or not, if you have a good business plan.

With your new sword in hand, go forth and chop off the heads of a few competitors, who offer up unprofessional attitudes (like some of them posting here), and who throw insult and injury.

With all the bad in the world we sure don't need any more negative attitude.

Personally...I love the sound that a million dollars worth of servers make.:)

Remarkable is the one who awakens to a new day, and embraces the spark within, shining bright the whole day long.
To you I say, there is a hallway called, "The wizards of Was".
It is a hallway, set aside within the building of a large corporation. It is here that retired executives return, to hang out with each other, as they miss the comradery and great freindships forged thru years of dedication to business.

SmashData
07-09-2003, 04:23 AM
All I know is I get 700GB of transfer from my dedicated server for $100 a month. My old T1 line cost over $1000 a month, and it wasn't as nearly reliable as a data center. On average there was a couple of hours downtime I month, in Los Angeles.....

Stick with the dedicated in a server farm. I've been with rackshack.net for over a year, and have only experienced downtime twice.