I have noticed lately that many more larger hosting companies have raised the bar quite a bit. 1, 2 & 3 GB disk storage plans abound with 10, 20 30+ GB of transfer.

How is this all possible? Hardware prices are down but you sure can't fit that many clients on a single machine if you are giving away 3 GB, or did I miss some new terabyte hard drive that is selling for 24.95 (pass the ginshu steak knives please). Bandwidth has fallen but surely it still has some value.

I have over the years read through all the overselling threads but this is a new trend and a sea change.

Yes, part of it is that bandwidth prices have fallen over the years.

But honestly part of it is that hosts know that the vast majority of their customers won't use a fraction of it, so there is a fairly low risk in offering huge amounts of bandwidth. Of course, some customers do use a lot of bandwidth but they are few and far between so there is definately room for them.

I can understand about the bandwidth but the large amount of disk space has me scratching my head. I know if I offered it many would take me up on it.

It is the same principle: they offer "unlimited" or a huge amount of disk space knowing that very, very few customers will use more than something like 200 MBs.

I don't think it is good for hosts to offer "unlimited" disk space as it is impossible to really keep that promise if someone "really" took them up on that offer. They count on nobody really doing it. So it is marketing only.

Don't you think a bunch of customers would use the 3 gb to backup their desktop

they very well could

maybe the way to phrase this is, we don't believe in overselling and so the problem becomes how to compete with this vast overselling.

Cause the general public has bought into the notion that like computers, webhosting should keep getting cheaper, and do more for less.

Yes, unfortunately, that appears to be the "game" as it were.

Part of it is that disk space and bandwidth are getting cheaper -- but part of it is the hosting industry has become somewhat saturated, so there is this sort of bidding war going on for the customer.

backup their desktopThat would be uploading copyrighted work on the server. Not a very good example since I believe most hosts would not allow that.

Fact: I have some 14GB of space and 170Gb of monthly data transfer that I could use (in theory) in my two hosting accounts. Last I checked I was using under 100MB of space (the majority of which is email accumulated over time, and I generally use under 1GB of total data transfer. If most customers are like me, high level overselling might be a manageable game after all. :)

That said, I do believe that the current trend makes hosting packages become a hilarious contest of numbers that unfortunately makes people think hosting is cheaper that it really is.

Originally posted by ldcdc
That would be uploading copyrighted work on the server. Not a very good example since I believe most hosts would not allow that.


Actually most copyright laws permit a backup as a fair use right. e.g. that is why you're allowed to copy your DVDs. So there is nothing illegal about backing up your computer like this. The problem would be if you let other people download those files. But that is trivial to prevent with most hosting accounts.

So be different and do not offer this massive overselling. Instead, use it a selling point for your services, your honesty, your business minded approach to hosting... Show how the math does not work, why yours does, and why a customer should choose you over the competition. It's harder work, but pays off in the end by creating clients that are quality focused instead of price focused.

- John C.

John C.
That is of course good advice and has been repeated before in these forums.

I guess what I am getting at is I sense a real change in direction, this isn't just 1 or 2 hosts hoping to snag customers that are not being realistic, but rather a wholesale move by many to a new level. I remember not too long ago anything in the 200 to 400 mb range was a large account. With these current conditions it looks puny.

Yes, I agree there is a trend in the mainstream hosting sector to keep upping the disk space and bandwidth in all plans to ridiculously high levels. As has been mentioned, most clients never use close to anything near these levels, so it becomes a marketing game. The thought is clients will choose the host with the biggest plans, so they "one up" each other to try and manuever for position.

It is a slippery slope, as your company becomes known for its commodity driven hosting plans rather than its support, software, reliability, etc... With such a new market though, customer confusion abounds, so savvy marketers take advantage of this fact by making the unknowing customer think that a bigger plan is better.

Is there an end in sight? In the short term, no. It's sort of like cell phone companies offering more and more minutes (sometimes more than exist physically in a month!), or the car companies recently all offering employee discounts, discounts on the discounts, and so on... The trend only works for so long, and then reality sets in and things come back into "normalcy" (hopefully). Many larger firms are hoping to capture a large share of the market, so they can be positioned in the long term for raising prices to increase profits...problem is with a global market like hosting, this is not feasible at this point in time, so these loss leader like plans may not pan out as would be expected in more traditional markets.

- John C.

Originally posted by chinook
Don't you think a bunch of customers would use the 3 gb to backup their desktop

isn't it in TOS/AUP that server is use for web site only and not for personal/public storage dump? i know i include that clause in my TOS/AUP.

I think that's kind of weird. I mean shouldn't clients be allowed to use their webspace however they want as long as it's legal. That'd be like me buying a pod storage or whatever and the owner saying I can't stuff some furniture in there.

Web hosting should be only for web-based content. If someone wants to backup their data, they could burn it on a CD or DVD. It would be much cheaper than a hosting account.

I tend to agree with MaxterHost. Web hosting by name and nature should be for hosting web sites only. If a user wants to backup data there are dedicated backup services throughout the internet for this purpose.

Originally posted by pixelized
I think that's kind of weird. I mean shouldn't clients be allowed to use their webspace however they want as long as it's legal. That'd be like me buying a pod storage or whatever and the owner saying I can't stuff some furniture in there.

then he/she can purchase a storage account that will cost more. webhosting should be only website. i don't see why you should allow to store personal stuff on a webhost server and pod storage is different. you're buying a ipod as a music device that can also be use for storage but you own it. you don't own server. you're only allow to use it as my AUP/TOS stated.

if my customer lease a dedicated server from me, of course he can use it as backup server but not buying a hosting package from me and expect to use it for storage. my server, my term, he is not getting the whole server only part of it. unless he rent a whole server from me.

I must say bandwidth prices and the digital data storage prices have reduced considerably due to leaps in technology.
Google started gmail with a 2G offer. Who can beat that. I still backup my data in gmail. Yahoo started way after google got into this.
So, it is obvious that reflected in the hosting side too. People are not using even half of what they are offering, but technology coupled with marketing sense ( to understand nobody fills up 2G on email all that soon ) has promoted this.

If you offer a ton of space/bandwidth and put in your TOS that the user cannot use it for personal storage, 99% of clients will use less than 100MB of space

Originally posted by pixelized
I think that's kind of weird. I mean shouldn't clients be allowed to use their webspace however they want as long as it's legal. That'd be like me buying a pod storage or whatever and the owner saying I can't stuff some furniture in there.

Part of the problem with this though is the liability of it. I could have a user backing up their music onto my server under a password protected directory, but how do I know they are not handing those credentials out so that others can illegally download?

A host saying "I thought they were just backing up their computer" won't stop the DMCA coming to haunt you. It's easier to not allow it in the first place and makes it much easier to catch the stuff that is illegal on your servers.

The distinction could be storage space versus website diskspace

Just had yet another thought, on a windows server, you can set any folder to be compressed so although you might offer a 1GB of web space the actual drive space could be up to 60 percent less. Wonder if this is part of what is going on.

The added benefit of using compressed folders means the bandwidth is automatically choked because of the extra time required to uncompress the requested page.