I am new to this type of biz. Help me please !

When I was searching for hosting for my primary page, I noticed many sites giving more than enough bandwidth for small spaces. I've seen something like 2GB or 5GB for 20MB space. Some sites even go to the extreme by advertising unlimited bandwidth!!

But when I was searching for reseller account, I noticed that most of the big companies give resellers very limited bandwidth. For example, MCHost gives 12GB bw per 1GB space!

I am considering MCHost and just am wondering how to allocate this bandwidth between my customers?

Suppose that I sell 40 accounts with each of them having 20mb space. This will result in 300mb bandwidth per account per month (12GB/40). From previous experience I know that users with 20mb space usually do not consume 300mb of bandwidth per month. But from marketing point of view, putting large number for bandwidth is preferable. Now, is it legal to market these accounts with 1GB of bandwidth each but actually give users 300mb only. If it dose not work this way, then how can I offer larger bandwidth at reasonable price?

This is what most people here call "the number game" :)
You'd have to figure how much bandwidth people are going to consume on average. If it's > 300MB, you're screwed, if it's less, you're safe :)
It is of course legal to advertise 1 GB of bandwidth allowance, while you don't have enough bandwidth to let everybody use up their 1 GB. But you'll have to be very sure that the average will be less than 300MB.
The downside of this all is, that hosts who play the number game are often found to shutdown accounts that use more than they want and tell them "they use too much cpu power". This is a Bad Thing (tm) :)

In short: only promise that GB of bandwidth if you're sure you can provide it to customers that really use that much and DON'T shut down accounts that are getting too close to that GB with a lame excuse.

Good luck !

Is everybody in hosting biz playing this game? I think there should be some other way! Can I purchase more bandwidth from the company I’m doing biz with to suffice my customers’ bw needs? :confused:

Originally posted by Mans
Is everybody in hosting biz playing this game? I think there should be some other way! Can I purchase more bandwidth from the company I’m doing biz with to suffice my customers’ bw needs? :confused:

I think most people are..
But I'm gonna do this a little different. I'm gonna include 0mb of bandwidth with my hosting package and I'm just gonna charge my clients per megabyte of transfer. I'll put up some examples like 'if you use 100mb of traffic you'll pay X for it" on the site and explain that people are often paying to much because of this number game.
And of course they will be able to set a limit on the amount of money/bandwidth per month that their site may use :)
I'll just have to experience if this scares customers off or not :)