Why do some hosts charge a monthly fee AS WELL as a setup fee for some H/W upgrades?

For some plans I've looked at you'd be able to buy the part 3 times over for the yearly total!

There may be a good reason for this but I cant see it! (Coming from a hardware background).

Aloha

Q. Why are they in business ??

A. To make money !

(this is the answer)

Some hosts require setup fees, because they are adding new extra features to the hosting account.

From reading other posts about this subject I can say that the way the per month charge is justified is that it costs more in:


more power for additional equipment
more equipment creates more heat, thus more cooling is needed
they're required to replace the hardware if it goes defective, thus the fee is like insurance
and of course they're trying to make money ;)


though i don't particularly agree with those statements... not like a stick of memory is going to cost an extra 10-20 dollars per month to maintain really! ...esp since the setup fees for adding something like that are generally through the roof in comparision to market costs... but most cases require low profile which costs more... and of course there is the labor to install the new hardware.

my person dig is that i'm not going to go with a host that charges me monthly for something like that... i figure the monthly fee for the server itself should cover that extra incidental (if any) expense.

Fair enough the ram used is more expensive than what might be found in an everyday home pc but I dont think monthly charges justify the amounts.

A setup charge is fair enough, even taking into account a spare unit which could be easily clarified in the charge, even the additional power consumption could be calculated and factored in the charge. I think properly explained most people would wear that.

Agreed that monthly = money but I think thats a bit too much profiteering. Also probably an effective way of capping the power of a server and the amount of accounts reasonably held on it or the amount of traffic it can sustain thus giving a potential way of calculating its maximum impact on a network.

One host I looked at for a 256 upg to existing 256 would sting you for something like $350 for a 12 month period!

Thats a bit high in my opinion. Besides, majority of people perceive h/w as a onetime expense item, not a rental, a onetime charge even if it was for the same amount explained properly would be less damaging in terms of peoples perception of it.

Aloha
I wrote some stuff in the other post to me it is kinda a scam as to how they make money
I will not deal with a host who charges that much for memory
to me they are ripping people off
to me if you say your win2k hosting comes with 128 megs
yeah like it is going to run on that and they have super high upgrade charges.
or even Linux with 128
they should start off at 512 megs then charge say 1.5 x the regular price they still make money and have enough to have extra around

to me if you say your win2k hosting comes with 128 megs yeah like it is going to run on thatIt actually runs quite well on 128 depending on how you set-up W2K.

Yes, I agree some hosts charge too much for upgrades.

But if you also look at it like leasing a car, you are not going to just pay for the cost of the car. You pay a premium for the convenience of paying monthly and being able to turn it back in at the end of the lease for something new without penalty.

Its important to note that when you get a hardware upgrade for a leased server that they are charging you for either the one time upgrade or an increased monthly fee. They will somehow get their money for the parts, opening the box, and time etc. With a scsi hard drive you may not pay the 400 dollars upfront for what it cost them, but over a 12 month period they may charge you a 150 extra for setup and say 75 dollars more a month. So they lose money on it for the first 3 months and then start making money after. This is perfectly reasonable.

In regards to memory, I seriously think its just a left over from the days when memory really cost a lot of money. I think most hosting companies prices havent FULLY reflected the drastic drop in price that memory has undergone. Last year I bought a 256 stick for about $250, the same stick today costs $29(w/o shipping). I am aware of some companies that raise the monthly fee for memory almost as much as the retail value of the stick itself. Now an increase of $40/month would have made sense two years ago, but obviously not today.

Aloha

on one other note I think it depends on what level of service a place is giving
memory upgrades should not need to be what some people charge ??
also if you have other services etc... that you may offer the cost balance of a package can balance out
such as if you offer MSSQL etc... for most people to set this up themselves is a lot of $$
I would say people would have to look at the whole package of what they get and decide.

Originally posted by Honu
I would say people would have to look at the whole package of what they get and decide.


i agree completely, definitely need to look at the overall when considering this sort of thing

It's EXACTLY like financing a car - The host has to pay for the hardware up front... and for that conveinence, the customer pays a little more in the long run. :D