>From the Desk of Tom Cunningham

I am writing to you today to both express my sincere thanks to you and to
ask for your continued business as we work together to support your
business.

I'm happy to announce that over 600 web hosting companies, web designers,
and entrepreneurs are “Powered by Alabanza” hosting automation. We take very
seriously our obligation to deliver the tools that these organizations, our
customers, will need to make their businesses successful. In 1996, I started
Alabanza's virtual hosting business as a reseller. My continual frustration
with the lack of software necessary to manage my business is what inspired
me to build our product offering. That same passion for automated solutions
drives me today to continue to build more features into our DSM and CP,
keeping our customers on the top of the industry with the best tools
possible.

We're working harder every day to make your job easier. Last week, you
received an announcement about the great new features that will roll out
tomorrow. These improvements to our system are designed to both make your
job easier and to enable you to make more money by being able to charge your
own clients more for added features. Our improved Control Panel and upcoming
User Panel offer you opportunities for bigger and better packages.

Other exciting items coming soon include a clients-only section of our web
site, real-time processing in AlaCart and another OC3 mux'd off the 2 OC48's
now installed at our location.

Throughout the summer, we sent some of Alabanza’s top executives to visit a
sampling of clients and survey their needs. The overwhelming response has
called for continued development of our software. Taking that direction,
we're hiring even more programmers to make sure our technology is a modular,
scalable, and dependable market leader. Know a C, Java, or PHP programmer?
Interested candidates should send a resume to resume@alabanza.com.

Alas, additions and improvements don’t come cheaply. To meet the demands of
development costs associated with bringing you the best package, we’ll be
issuing some price increases soon. Those increases are outlined below in
detail. No changes will take effect until your first contract renewal on or
after November 1st. We want you to let you know now so you will have time to
prepare and/or ask any questions you may have.

The most notable price increase is the $1 per Control Panel charge. The
addition of this charge may come as a surprise to many of you; however, it
is something that is necessary for us to do in order to continue delivering
quality products and services to you. As you all know, there are many cost
savings for our clients as a result of the automation involved in the
billing, setup, signup, domain registration and account release. I sincerely
believe that all of you will recognize this and continue to partner with us
as we develop more and more software to make your businesses successful. On
our part, we will be redoubling our efforts to continue to bring you the
best in Web Hosting Automation.

This is an exciting time in the Internet economy, and we look forward to
helping your business grow to new heights.

Sincerely,

Tom Cunningham
President, Alabanza

*************** PRICE CHANGES *******************

SERVER PRICE:
The price of new standard servers after November 1, 2000 will be $895/month.
The standard configuration of new standard servers will be:

Pentium III 550MHz
18GB SCSI hard drive
512MB RAM

The price of new RAID servers after October 1, 2000 will be $1650/month.
There will be a 10% discount on RAID machines if they are purchased on an
annual contract. The RAID configuration will be:

Dual PIII 550MHz
3 9GB SCSI drives on RAID5 system
1GB RAM

All new servers must be purchased on a quarterly contract (monthly billing
only after three months have been paid in advance). There will be a $500
set-up fee for quarterly agreements on all servers. That fee is reduced by
50% to a $250 set-up fee if a new server is signed on an annual contract.

Server pricing will not be changed for existing servers. Any server pricing
listed on current contracts will be honored.

CONTROL PANELS (CPs):
Pricing for CPs will take effect on November 1st, 2000 for new server
contracts. The pricing for CPs for existing servers will take effect at
their first contract renewal on or after November 1st, 2000.

The first 35 CPs per server are free.

Standard (non-Raid) Machines - There will be a charge of $1 per CP in excess
of 35 and $3 per CP in excess of 500 on each server. You will have the
ability to disable individual CPs where they are not needed. There will be a
hard limit of 1000 CPs per standard server.

Raid Machine - There will be a charge of $1 per CP in excess of 35 and $3
per CP in excess of 1000 on each server. You will have the ability to
disable individual CPs where they are not needed. There will be a hard limit
of 1500 CPs per RAID server.

VIRTUAL NAME SERVERS:
Pricing for Virtual Name Servers will take effect on November 1st, 2000 for
new server contracts. The pricing for Virtual Name Servers for existing
clients will take effect at their first contract renewal on or after
November 1st, 2000.

The charge for virtual name servers will be $5 per month, per set.

If you have any questions regarding these changes, please call our Sales
Department at 1-800-361-2682, email salesteam@alabanza.com, or contact your
account manager.

I'm sorry, but that message says this to me.


"I'm going broke please help me pay for the three porsche's in my garrage".

I'll eloborate why I think so.

Consider this, alabanza easily hosts 300,000 domains/accounts with control panels.

So thats 300,000 control panels.

Lets estimate about 900 servers which gets 35 free CP's each.

Thats 31,500 control panels free.

That leaves us with 268,500 control panels in use @ $1 per control panel or $268,500 EXTRA revenue EACH month for alabanza. Plus they fired a lot of reps so their really bringing the money in don't you agree?

Guess their buying everyone a porsche as a company car now right?

oh man, extra 5 bux for a virtual name server? damn, i have to charge more now :(

/me looks at vdi.

I'm not positive, but i think it is a one-time fee for the Alabanza CP, not a monthly fee?

Anyone know for sure?

Can you do it yourself? Overcome their CP and set up accoutns alone. It surely can be done and... would be MUCH cheaper.

Of course, I don't knwo if you are allowed to do what you want with the server you are paying for.

Should I send in my resume to help with their CP or do my own? :)

Greg, i'm 99% positive this is a monthly thing, if you can get anyone @ alabanza to answer call and ask em.

Originally posted by Félix C.Courtemanche
Can you do it yourself? Overcome their CP and set up accoutns alone. It surely can be done and... would be MUCH cheaper.

I'm sure this could be done, but I think you'd be an errrrr... dumbass to pay $900 for a server that you could get elsewhere for cheaper, and set everything up by hand. Agreed?

edit
Ahh, well, you probably just meant to do it for certain accounts.. nevermind :)
/edit

I just phoned Alabanza and there was no answer.....%#@!%!@

With prices like that it would be very hard to start a new hosting company without losing a lot of money. If not impossible.

------------------
Mike L.

E-mail: Mike@interserver.net
ICQ#: 42499339
AOL/AIM: IntServer
http://interserver.net
(877)566-8398

anyone know how they can offer 2 ns's for each customer? won't they run out of ip's? If each domain has their own "ns" and "ns2" nameserver, that's so many dedicated ip's. Unless the "virtual" nameserver is shared by many people...which I dont think is the case because when you trace the ip, it resolves to ns.yourdomain.com.

the VDNS is $5 PER month as what I heard

This is all really sad :(

Here are my estimates on how much we will be paying, soon.

Server: $800
465 CPanels: $465
About 50 pairs of nameservers: $250
Plus bandwidth fees, $10 a gig!
----------
$1,515/month
plus bandwidth fees!

This is nuts!

I just talked to someone at Alabanza and asked them if the CP's were a monthly fee or a one-time fee, he did not know, so he put me on hold and talked to his supervisor.....he then came back on the phone and told me i quote "nobody here knows if it's one-time or monthly fee foe the CP's"


All i can say is......WOW! Nobody there knows....who knows then?

LOL

Greg,

It seems that they don't even know what's going on.
How do I say this...
hmm... maybe they already forgot? ;)

I guerentee you with these new prices they wont get any new customers, I guess they figure that their current customers depend on them so much that they wouldnt dare move! Bad business = no customer period. I just feel sorry for all the Alabaza hosts

I'm gonna get out of this busines! LOL j/k..

"hey.. what's that 800 number for the truck driving school again? 1-800-truckmaster?" LOL

Sally Struthers offers that nifty tv/vcr repair home study program. Other degrees: Changing light bulbs, Putting on your shoes, and Collecting shells.

Just one more class and I'll be certified to put my shoes on *and* put shoes on others.

But Chicken, can you TIE the shoes? or are they velcro? Maybe shoes with strings is for next semester?

Originally posted by Chicken
Ahh, well, you probably just meant to do it for certain accounts.. nevermind


I meant... create a modified version of their CGIs or do your own little patch to do it your way and forget their (sorry but stupid) idea of paying per customer.

Not only you pay for the server, but you also pay for your customers... (????)

I don't know if it's me, but I'm somewhat glad to be on my own now... Alabanza was good... is it still?

Howdy,

Maybe the reason no knows for sure if the CP charge is a monthly thing or a yearly thing is because nothing is in place. The plan could be to first gauge their clients reactions and then make a decision ;)

so if there is a large attempted migration of clients away then they could come back and say: hey! it's just a one time fee ... no need to go anywhere!
(just a theory)

later

David

I really doubt it if that is the case. I think this is a permanent decission. :-(

I've tried to keep quite, but I can't, hey I'm an ISP, what do you expect.

I think that this is an attempt to get rid of the small potatoes. The mom and pop companies, which to be quite honest, is what started Alabanza.

All I hear is "it's only a dollar". Well if it's only a dollar, don't charge it. :)

On a different note, we have decided to ride the storm out for a while. We did purchase a server from Ultraspeed, their Alabanza Stomper or whatever it's called. Overall I think that this will be a good move for us (getting the Ultraspeed server). Heck, a faster server with more bandwidth at a cheaper price, how can I go wrong? Not to mention Daniel is pretty cool.

Originally posted by DanielP
I'm sorry, but that message says this to me.


"I'm going broke please help me pay for the three porsche's in my garrage".







Well I dun totally agree with that statement. Agreed, they would be getting more money in, but whats the harm in that?? That doesnt mean they are running out of money. All the BIG hosts they got there, would surely not mind that 1$ for the cp. The smaller ones are the ones who would have a problem. So I guess, they just wont big players with them, and not small!

My, ummm, 1Rs. ;)

Originally posted by kunal
The smaller ones are the ones who would have a problem. So I guess, they just wont big players with them, and not small!

I agree with you, but the problem with this thinking is that some of the small hosts will become large host.

But what host in their right mind is going to move 5000 or so clients from a cheaper server to Alabanza's server system? NONE!

What drives smaller ones there now?? The Automated system! Plus, the people who are really gonna get new servers from Alabanza are the people who can make BIG investments for advertising, servers etc etc. So the new ones will become bigger faster then the ones currently there!

Originally posted by MarkSmith
I'm glad about all this new Alabanza stuff.
Alabanza will not be #1 any more.

A good chance for other "real" webhosting companies
(not alabanza-based) and their reseller plans.



Define "Real" webhosting companies for me, will ya. I am kinda fuzzy abt it.

Originally posted by MikeA
I think that this is an attempt to get rid of the small potatoes. The mom and pop companies, which to be quite honest, is what started Alabanza.



But that also doesn't make sense to me! Why did they have a $400/month special then? To attract big companies? NO! They had a special to attract new smaller companies, so now they don't want the small companies?

Originally posted by Greg

But that also doesn't make sense to me! Why did they have a $400/month special then? To attract big companies? NO! They had a special to attract new smaller companies, so now they don't want the small companies?


I guess, it was a test, to see the market and then make the move they just made. I dun think they expected such a Overwhelming respone though.

Another idea...
The give a huge special, so that people coming in start making some cash, etc... then they increase their price (so to recover any lost money during the special)

Majority of the host based there won't want to move all their customers to another host. Moving people from 2 servers in a web hosting company isnt fun... but moving a whole company... ouch.

See the point?

- Attract
- Charge
- Charge
- Charge
- ... you get the idea. The new small host will have most likely enough money to pay the new fees... but they will not get what they expected really.

Rude awakening maybe?

Originally posted by Félix C.Courtemanche

- Attract
- Charge
- Charge
- Charge
- ... you get the idea.

If that is their strategy it will only get them so far. Up until now they had a great reputation ... and it looks like the may have taken some steps towards blemishing it. (IMHO)

Another theory I have is they may have let in small businesses in the beginning to fully test and perfect their cp (while bringing in *some* cash). Then once it got the the quality they wanted where it can support "larger" companies easily, then they are now making the switch ... i.e. jacking up the prices.

David

Originally posted by Greg
But that also doesn't make sense to me! Why did they have a $400/month special then? To attract big companies? NO! They had a special to attract new smaller companies, so now they don't want the small companies? [/B]

I think that they wanted more servers. So they opened it up with "let's see what this will do". Then they started getting people who had NO idea what linux was much less how to opererate it

I think they were a little naive about it. As a result they got slammed with customer support requests from these people. Notice how support now takes about 48 hours to get a response.

Now they think to themselves, how to get out of this hole we are in......Let's charge more. The hell with everyone else. The people that really love us will stay and all the crap will leave. We will disguise it under the pretense that we need the money for further upgrades.

I think they want to keep people like Jumpline. People with 1000+ hosts. Cfoxhost, Annette, Dana, Marty, me and a few others are expendable and acceptable looses.

I totally agree with you MikeA.

Originally posted by MikeA
Originally posted by Greg
But that also doesn't make sense to me! Why did they have a $400/month special then? To attract big companies? NO! They had a special to attract new smaller companies, so now they don't want the small companies?

I think that they wanted more servers. So they opened it up with "let's see what this will do". Then they started getting people who had NO idea what linux was much less how to opererate it

I think they were a little naive about it. As a result they got slammed with customer support requests from these people. Notice how support now takes about 48 hours to get a response.

Now they think to themselves, how to get out of this hole we are in......Let's charge more. The hell with everyone else. The people that really love us will stay and all the crap will leave. We will disguise it under the pretense that we need the money for further upgrades.

I think they want to keep people like Jumpline. People with 1000+ hosts. Cfoxhost, Annette, Dana, Marty, me and a few others are expendable and acceptable looses.
[/B]

I agree with you on that one. Sounds like it's on the money. But they are shooting themselves in the foot. I am sure jumpline started out a one or two person show themselves.

Also I am sure they had alot more signups with the deal they were offering. But instead of getting more tech support help with that extra money like they should have they didn't and that's probably why the response times went up. After all it's managed hosting. Thats why they charge as much as they do. Why would I as one of their clients fix it myself when by doing that I could disqualify myself for help from them doing it.

I'll halfway agree with Mike on this one: they probably weren't prepared for the response and then suddenly realized that quite a few people decided it would be "cool" to set up a hosting business, under the theory they could just sit back and not work or anything (or have any particular technical knowledge, basic understanding of linux, etc.) - and these were the people for whom they were unprepared (or naive about, to use Mike's wording). I do think that some of their customers mean something to them, just as other companies might value some of their clients more than others - if only because they don't send in as many support tickets. :)

me expendable? Moi?? surly you jest!:angel: LOL I think Alabanza is being short sighted..so they want to get rid of the "small potatoes" but ya know what?? someone else will pick those potatoes and make lots a fries out of it ..and alabanza will loose out.

I just think we are seeing the end of a well prepared advertising thing...

The keys to advertising on this kind of industry is to attract new customers, offer them good service untill they reach the point where most must stay with you to continue offering their services, then raise the prices.

If you have 3-4 servers with them... you can't even possibly think of moving all those customers. You would need to give them some repairation for the trouble, have 2x servers for a month (the time to switch them) then explain the new rules of your servers, etc, etc, etc, etc...

Compare this to a business moving at the shopping mall, which suddenly raise their prices... a bit.
They won't move, even if it mean less cash, because moving would cost them even more. I don't say Alabanza is trying to kick you out... but I do think they found a pretty nifty way to squeeze some more cash from their current customers.

test

Originally posted by anotherAlaCo
test


what the hell is the point of this message??

We've got 5 servers and I gurantee you we'll take the time and headache of moving all customers. I wish Alabanza had stock, I'd short the hell out of it!

I used to work for Alabanza - up until two weeks ago. So you know my perspective. Alabanza is a good company with a nice product - DSM - and lousy everything else. The CP price rate? VNS fee? They ARE negotiable - the Jumpline's will NOT be paying retail, and you might not have to if you make a good enough case (and are someone they care about). Why are they doing this? Three little letters - IPO. Wall Street likes to see a lot of black ink, so the more short term income Alabanza can show, the richer they'll be in the short term (and it's all short term anymore isn't it?).

Keep in mind that the entire enterprise is focused on IPO strategy, and every move they have and will make will seem a lot clearer.

As for my little clients, I think they're golden and will make every effort to keep them.

On the other hand if we take an example from Alabanza, we probably don't need those small clients. They're not important. We should raise our prices to get rid of them. Besides if get rid of them it's that much less support we have to provide. And the larger clients that would really have hard time moving (their clients) to another server have no choice but to flip the bill for the loss of the little guys. Did I mention that we should take our sites off line so that no one else signs up too. What a relief, my work load would be so reduced. I'm not sure how I'm going to get rich this way, but at least I can relax.

I'm a little guy and just want to say thanks to all the large hosts at Alabanza for incurring the expense of helping them along in their success. If I feel hosed, how you must feel might best not be described here.

(As a reminder I'm starting a hosting business and was about to sign with Alabanza on a 12 month contract).

I got the warning mail from my Sales Rep this morning about the new charges. This just about puts a lid on it for me. If the intention is to lose as many customers as possible in the minimum amount of time...well mission accomplished judging from the feedback here. I, for one, will not start a new business with a partner that hikes prices with no rational justification so that's $8,000+ per year of revenue lost. If Alabanza considers it prudent to increase their charges at a time when demand for their product is growing strongly, then their management clearly misunderstands the basic economics of doing business.

I agree with those who have expressed the view that this stinks of profiteering. Perhaps the company motto is changing to "attract, contract, extract".

Back to the drawing board for a reliable solution then...

Speedie.

UltraSpeed USA
http://www.ultraspeedusa.com
dpearson@ultraspeedusa.com

are offering a great alternative to Alabanza ... (I gathered from previous threads ;) )

later

David

One of my partners asked me if there were any alternatives to Alabanza under the current circumstances. I assured him that I'd look into them.

Thomas,

I'm looking hard myself, so will post anything of interest. Perhaps you would be good enough to do likewise?

The choice of solution provider is a big decision for a hosting start-up, and I have to say I'm personally very upset at the way this has been dealt with. First came the offer of a server for only $475/month for the first 12 months which was great. Now I find that if I have a full server (say 400 clients) at the end of that 12 month period, my costs will rise not just to the $800/month that I had expected, but $1,200 instead. A difference of 50%!! No way will I expose myself or my clients to the risks of dealing with a company that considers this to be a good strategy.

All I can say is thank God my merchant account application was delayed, otherwise I'd be just another Alabanza hostage.

Speedie.

VDI would be one! :)

Definitely - if they hadn't just ended their ramp-up offer.

Speedie.

Although they ended the ramp up offer, they are more than willing to to talk to you about other alternatives. They know you are interested (well, not *you* personally), and I suggest you email them with your concerns.

Awww dammit. Just for a moment there I thought I really was special. Rather than special ed that is. Oh well.

Speedie.

It's time to be like sotry just like *****

Don't you feel the same? LOL