Is this type of business oversaturated in the market... is there money to be made?

I was looking at a website and thinking of leasing a server... "rackspace"

ok reading the threads there is money to be made...

I am a recent grad and flash designer... like most I want hosting for my sites and friends sites and try to make some money on the side... and maybe grow to even larger...

"reseller accounts" I've seen websites that geared towards resellers... I've been looking around at a company that leases servers and you use them for whatever...

If I were to get my own server... I would have to also pay for some Oc-3 connection as well? and maintain it myself correct?


So let's say I lease one server... is it basically build a company website, find clients.... Do I have to register as a company...

Hi, geestring

If you get your own dedicated server you will just have to pay for the server not connection everything is included server and connection. One thing that it is not included is server admin, you will have to do all configurations as it is not fully managed If you dont have any expierence with dedicated servers I advise to start off with a reseller plan. And also remember to ask all the questions that you might have to the host. try doing a search here on Rackspace. As I remember for tech help on the dedicated servers you will have to pay $25 for each ticket, if you dont know what you are doing.

Good Luck :)

I would strongly recommend going for a reseller account first. Once you outgrow that you can move on to a managed dedicated server. Since you're a designer you may want to find local clients who are interested in web design. Then you can design their site, host their site, and maintain their site. Local clients generally pay more for the personal level of service they receive. Additionally, it's easy to compete in the local market as most local companies tend to charge an arm and leg.

Good luck starting your business.

ok buying and building your own server is not the same as a dedicated server?


whats all this talk about merchant accounts

No it is not at all, the server is built already and all connections are done. You just have to administer it. And if you do not know anything about that you will have to hire someone else to do that for you. Start with a reseller plan the grow.

Originally posted by geestring
ok buying and building your own server is not the same as a dedicated server?


whats all this talk about merchant accounts
Merchant accounts are accounts that you use to receive payments from your customers with. If you take my advice above and target the local market, you may not even need this.

Some merchant account providers are:
www.authorize.net
www.paypal.com
www.2checkout.com

so then dedicated servers are prebuilt with bandwidth that comes with it? or dedicated servers are the sources of bandwidth hehe?
to my knowledge you get bandwidth from an isp....


do i have to be registered as a business?

Actually technically speaking, 2checkout does not specialise in providing merchat accounts. It is more of a third party credit card processor, though for some legal resons they need to call themselves resellers of your products/services.

I'm not sure whether paypal is a provider of merchant accounts or not as I didn't took a close look at their services (they don't deal with people from my country).

If you're looking for a way to process payments, you should spend some time in the Ecommerce Discussion forum: http://www.webhostingtalk.com/forumdisplay.php?s=&forumid=66

EDIT: Thread moved to Running a Web Hosting Business.

A dedicated server come with the server, connection, Control panel (Optional) and bandwidth some give out 1000GB - 2000GB of bandwidth. As I can see you are type of new to dedicated servers, That is just a different world compared to shared hosting, but you can learn from a reseller plan, just like most host did and move to a dedicated server.

Good Luck

so then dedicated servers are prebuilt with bandwidth that comes with it? or dedicated servers are the sources of bandwidth hehe?
to my knowledge you get bandwidth from an isp....


do i have to be registered as a business?

geestring,
A dedicated server that you either rent or lease comes with a connection to the internet. The amount of bandwidth (i.e. internet traffic to your server) is set with the lease depending on the company. Most companies offer you the ability to purchase additional and all companies have overage charges for going over your limits.

There are 4 options in this industry as for servers themselves:
Dedicated Servers - You rent/lease another companies hardware and bandwidth.

Lease/Purchase Server - You pay a monthly fee or outright fee to purchase your own server and then lease a space along with bandwidth at a colocation service.

Build your own server - You build your own server and again lease/space bandwidth at a colocation service.

Build your own/lease/purchase with own bandwidth - You obtain a server through one of these methods then make arrangements with the various bandwidth providers (level 3, att, cogent, mci, etc...) to lease lines from them that go to where you have placed the server.

To be honest I would recommend starting with a VPS if you are actually looking at going into a dedicated server at some point. Specifically I would recommend a managed VPS so if you mess it up someone is there to help you fix it.

A VPS = Virtual Private Server is much like a dedicated server except it is placed on one physical server that runs many of these. They tend to be less expensive than a dedicated server, but where as each one runs seperate as if it is its own server you have the opportunity to get a feel for what running/managing a server will be like.

"learn froma reseller plan"

I think what im look at right now at rackshack is leasing a deidcated server with certain bandwidth limits....
Basically rackshack does the server maintenance and I deal with customers and accounts.....

whats a "reseller plan"?

the lease for that server has 150gb outgoing and unlimited incoming...

i don't understand what is outgoing and what is incomming for the users website....

you see hosting packes that say 20gb transfer... I would assume that is both upload and d/l?

If you don't understand, why are you considering hosting?

[Or are you just setting up a website?]

Incoming is data sent to the server outgoing is data sent from (i.e. serving webpages).

Realistically you need to do a lot more research before jumping into a server. From where your knowledge stands I would have to agree with starting with just a reseller plan.

Danx was a little harsh, but he is right. If you don't understand these concepts you need to learn about them before you start considering running a hosting company.

thats why I am here asking questions :)...

yes thats what I thought, the outgoing would be the server sending the person the data to view the webpage... wouldnt that be the grunt of the bandwidth? so if that hoster offers 20gbs of transfer per month and the server only allows 150gb... that 150gb would have to be allocated to just only 7 people?

what is a reseller plan, any recommendations...?

ok i read up on reseller and I think its th way to go for me...

I have seen a few sites but I want it so that I can make my own website....

Aynone recommendations that are good... I also want flash communication server since I will be targeting flash users...

You best option for finding a good reseller plan would be to choose specific companies then use the search option on this site and read reviews about them.

Any reseller plan allows you to make your own website.

Try looking at the offers section and remember to ask questions before you buy. Also do a full seach on that company here on WHT and google it before making the jump. You can make your own website in any server shared, reseller, dedicated or VPS.

Good Luck

but comparing to other webhosters that offer 20gb per month transfer...

If I match that using a reseller account that offers 150gb transfer... I can only allocate enough transfer for 7 or so clients? to compete with the host?

if thats the case I would only be making $40 or something in profits if I ran at full capacity?

is that how you guys do it? ayou guys like have like 20 rellers accounts....

1.) Competing soley based of price is not easy. You should look at competing off of services you can offer to your clients. Also, look locally as local customers tend to be willing to pay more for less since they:
a.) know you
b.) can easily get hold of you.

how much could you sellit to business.. even the money will be minimal?

Originally posted by geestring
is that how you guys do it? ayou guys like have like 20 rellers accounts....

Few web hosting businesses are what you would call lucrative affairs, the halcyon days of making your million from hosting are long, long gone - competing against the established hosts is extremely difficult and a quick way to throw away lots of cash.

I think it would be safe to say that the market as a whole is pretty saturated, only if you can offer some niche value added service can you make a name for yourself.

My advice: forget about general hosting, do what you already know - flash design, there is FAR more money to be made in creating websites than in hosting them (I prefer providing hosting, but reality dictates that my bread and butter comes from programming) get a reseller account and provide hosting to clients you do design work for, at a reasonable fee.

If you go into general hosting, to do it seriously you will need a *lot* of cash handy, a lot of time, and a lot of patience. Don't expect to live off the company for a few years realistically, I'd expect a solid loss for the first year as you pump into advertising.

yea hosting for design clients seems like a good idea...

I seen a local companies website and it looks like it was made by a 10 yearold using geocities....

You think I should approach them to build a new site... I just call?

I've just graduate and i am inexperienced so I dont know the proper way of approaching this...

However I truly think that this business will benefit from a better website.

Number 1 rule of selling, sell what you can believe in.

If you truly believe they need a better site, then call them. Explain to them why they need a better site, all the benefits of such.

Once you build them a site they are happy with approach them for the hosting also. If they are happy with one service they are likely to use another.

you make the money off the site then the recurring off the hostng and if you do well you gain a loyal customer who refers others.