When you are starting out a bran new hosting business you have to keep some things in mind and the main thing is "What if I grow?"

Let's look at a basic case. You have started out with a Rack Shack server for $100 a month and you get 300GB of traffic. You know that RackShack is the only place you can get that so you sign up with them. So since you have 300GB of traffic allowed you decide that you will offer cheap web hosting and large bandwidth. I see this a lot where someone offers 15GB of traffic for about $10 or 20GB of traffic for $15. The problem is if you grow and decide you need to get your own real server (that you own) and collocate it, you are going to have a hard time finding a place that sells bandwidth that cheap. So all this time you have offered service this cheap and now you find you can't do it if you are going to stay in business. The best thing to do is start realistically from the beginning.

Also say RackShack or any other company your with goes out of business for some reason. What now? You know nobody else offers the service you need to stay in business yourself. That's why you should always have a back-up provider and a back-up for your back-up. If you find a place you like with the service you like, find a couple other places with the same service just in case.

From what I have said above I want to make it clear that I am not putting RackShack down in anyway. I am just using them in this example. I think their service is great and even if you "Plan for Success" it's still nice to have all that extra bandwidth to fall back on.

If the company was planning on moving there clients to another server from the beginning they should have keep that in mind when they basically gave out bandwidth for free. However, RackShack will soon be providing colo, so you might see something come of that.

Thats true, RackShack will become more attractive to the middle/upper hosting class now

All I am saying is that a lot of people don't think that far in the future and they rush into it not thinking of the consequences.

Actually, a lot of people do think that far ahead. Its what is called a "Business Plan". Normally you would have things like that outlined in such a plan ( expansion and such ). If they don't plan ahead, they will just be left behind. Its there own problem.

Rackshack is also going to be selling linux boxes with unmetered 10mbit connectins (all you can eat). This will probably be the best solution if you need more bandwidth. Also, if you are serving up enough sites to saturate even half of that, you probably are going to need more processing power than a dinky Raq or whatever linux box they are going to be selling. Another avenue would be multiple servers.

Have you ppl thought of clustering??? Could quite easily setup 3 or so servers at rackshack and cluster them..

Never done it though.