Fighting Back against the Insane 200GB Plans [Archive]

bjdea1

03-03-2007, 01:35 AM

IRCCo Jeff

03-03-2007, 02:26 AM

The best way to get back at them would be to purchase the plan and use it.

Justin

03-03-2007, 02:27 AM

Maybe we more sensible Web hosts could take action to stop this. Maybe buy one or 2 of these plans and start loading massive files into these accounts - like photo albums, videos, open source OS, etc. Start giving these guys something to worry about? You reckon? Nah I won't be so nasty, but oh please - this trend has gotta slow down a bit !

Most of us wouldn't condone doing such a thing (based on a previous thread of similar discussion nature). However, the other thing to take into account, many tentative buyers are also beginning to smell such rats as well and staying away from those kinds of offers also these days. It really depends on the market area you aim at (and those overselling providers are aiming at as well) as to what type of customer do you want. In my experience thus far it appears those wanting insanely large plans (thinking they might even come close to using it all up??) seem to end up being less educated on the regard of hosting services in many cases, while those looking for reasonable resources are much better educated and thus seem to equal less a load on your support team.

While I realize this thread isn't purely to discuss the nature of oversold plans, I felt the need to touch on the topic as this goes hand in hand.

Xeentech

03-03-2007, 02:48 AM

I don't mind these plans so much, they're kind of useful. I get a few querys from potential clients that are after me to match an 'insane' package, or think we're over priced. That's not the type of client we're after.

They really are insane. Imagine how much a dedicated server with 2000GB of usage allowance and anything close to 200GB disk.. you're talking $500/mo from any decent DC minimum.

Any client that thinks that's even remotely viable as a long term hosting package is going to need far to much support from your staff... if you see what I'm getting at :P

siforek

03-03-2007, 02:55 AM

1 person using up 200GB still does nothing to these hosts. Yes, they do loose money on that one customer, but they've got 1000 more that use under 100MB.

I was pissed at first when I saw HostMonster doing the same for $4.95(now 5.95/mo), now I've realized that they get "non educated/experienced" customers. That's their target, and they can have all of them.

There's nothing worse than teaching a customer how to minimize their brower, or even telling them what a browser is. A call like that will let you know it's going to be a long night.

I've also noticed that nooby customers call at 3AM & freak out that they've got an error, professionals & developers call durring business hours and discuss the issue only after researching it themselves.

bjdea1

03-03-2007, 04:06 AM

The reason I started this thread is because we've already had a handful of our own clients leave us for one of these insane offers. I find it very annoying, they want to believe the offers, I guess greed can really blind some clients. I just think its a cheap and dirty marketing trick, not that it surprises me, and becoming a form of false advertising. Because the truth is we all know that these hosts will simply make up any lie to boot the client off their server if they start coming anywhere near using their full quotas.

Xeentech

03-03-2007, 04:25 AM

The best you can hope for is that customers will learn from thier expierience with these companys and learn to pick a provider with more realistic packages.

Untill then, honest hosts will just have to compete in some other respect like better customer support or more stable network.

Mikie4648

03-03-2007, 04:54 AM

Thats not the problem. The problem is everyone has followed suit. If only a few hosts offered unlimited everyting a few years ago and nobody else bowed down too that level then the hosting market would not be in the state it is. So why didnt we let them offer unlimited everything? So let them be but most followed the same mentality. Now you have an oversaturated market and everyone is doing it. I first say this on Ebay. First it was justa few hosts offering it then by the end of 2004 every single webhosting ad on Ebay was offereing unlimited everything.

bjdea1

03-03-2007, 06:17 AM

This is why I say "is the entire Hosting Industry heading for a correction"? Like the stockmarket has its crashes, are these Hosts setting all of us up for some kind of backlash in the future? How much further can this go? 1000GB Plans? 10000GB Plans?

Jame$

03-03-2007, 08:26 AM

Sadly it seems that this is the direction many large hosts are taking, probably not to lose this fierce competition..

2Macs Jim

03-03-2007, 10:15 AM

I like these kind of threads, makes me realize more people are getting frustrated over this. These types of rediculous plans have been around for awhile and unfortunately, I don't see them going away any time soon. If you go to a directory type site that lets people write their own reviews (like http://www.besthostratings.com/ for example), what do you see? The same old "Top Ten Hosts" and right next to that, everyone writing in saying stay away from "X" Hosting, my site never comes up, bad support, worst host ever, etc., etc.! Is it greed that makes people go to these types of hosts? Possibly, I tend to think it's more people that arn't educated enough and the plain fact that we all look for a deal. Everyone wants as much as they can for their money, which is understandable. I can also understand someone trying one of those rediculous plans, but what I don't get are the people that try one, come in here and complain, then try another host with similiar plans, come back here complaining again, then try another and another. Maybe just some people never learn. According to most peoples standards on WHT, we're one of the most expensive hosts here, with some of the smallest plans, but we stand by our prices/plans and our target market and wouldn't want to attempt to compete with the heavy oversellers. My personal opinion is there's a very good sized handful of very good hosts here on WHT that offer realistic plans and prices and great support. I just hope with enough persistence and time everyone here can help educate others so that, if nothing else, at least they fully understand what they're getting into when choosing these heavily oversold hosts with rediculous plans and pricing. Just my 2cents worth.

DATARTIM

03-03-2007, 11:36 AM

The Market will correct itself.

People are wising up that you have no chance of using the specs given as you are restricted by the cpu usage clauses in their tos.

Also they get sick of poor " your number 1987" support.

The Customers are the ones that truly make the changes, Companies tend to change to what the customers want , So soon the customers will realise that this hugely oversold plans aren't worth it.

Its all abou the Customers.

ServersAndDomains

03-03-2007, 11:51 AM

I wouldn't recommend this or try it myself, but here is an example:

Take 1 dedicated server with 200 GB of disk space and 2000 GB of transfer, at a cost of about $200 per month.

Sell a 200 GB hosting package with 2000 GB per month for $10/mo. Oversell it 20 times and you break even. Oversell it 100 times and you make a 5X markup and call that server filled. With the profit from this 1 server you can add 4 more servers just like it.

If just 1 customer in 100 uses all 200 GB of disk space, you will loose money on that 1 server, but you still have plenty of profit from the other 99 customers to add more servers.

In reality, it's probalby more like 1 in 1000 customers needs that much space, so the risk is not very big for the big "reputable" hosting companies who have a lot of money to burn. If you want to get back at them, you need maybe 50 to 100 customers willing to use the 200 GB provided to them. Maybe then they would rethink their plan.

coight

03-03-2007, 01:25 PM

We have some clients leaving over the same issue, they are paying more when they can go to another hosts who costs less and offers 20 times more. Only problem is they have a 1gb space package and they use 200mb's.

We don't activley pursue them it's their own choice if they wish to leave but in most cases they come back or I read feedback on here a couple months later that their no longer happy.

The bonus for us is when they come back in most cases they end up paying more than what they were originally getting. All these hosts will do themselves in as after time while not a high proportion of the accounts will be abused by users just enough will to affect service levels.

Last year we put dreamhost to the test on their 200gb plan. Guess what after loading it with 80gb's of legit ISO's we get an email stating we are "abusing" the account when we don't make the url for the downloads active. No email sent prior just a suspension and then their unwillingness to refund even though they offer a 90mbg.

I really don't care we are over matching what other hosts have let them take the weasel clients that have too high expectations (they want support requests fixed before they enter them in the system) and pay little.

We are actually going against the trend increasing prices, and decreasing limits. I would rather have 5 clients at $9.95 offering something reasonable and profitable without overloading machines than 20 @ 5.95.

The other thing I would mention don't compare yourself to WHT hosts. It's quite simple really. The only discussions about hosts here are those that offer ridiculous pricing and features. It would be nice if the industry was regulated. Then the body could limit this bs and have minimum package costs assigned to all hosts.

The reason so many hosting customers are burnt by customers is that offer such unprofitable packages and one day billy decides it's too hard and disappears.

Mikie4648

03-03-2007, 02:52 PM

http://www.besthostratings.com/ for example), what do you see? The same old "Top Ten Hosts" and right next to that, everyone writing in saying stay away from "X" Hosting, my site never comes up, bad support, worst host ever, etc., etc.!

That is correct, thats why you should move to another hosting directory when you see the "SAME OLD" hosts being placed on the TOP TEN LIST. The reason is, because the owner of the site has a commission junction account and in order to make commissions they simply place the "SAME OLD" hosts on the commission junction affiliate program, on their website in the hope of making a buck.

This is false advertising in my opinion. A webhosting directory should consist of REAL HUMAN POSTS by REAL website CEO's not some site admin whos controlling the lists to make a buck.

Show me a webhost directory that does not have a TOP TEN list of websites gearded towards making a buck of affiliate links?

Can anyone show me a real site? I tell you what, we are still in the process of setting up our own site and when we have finished coding it people will be able to posts their site links without anytype of FAKE top ten list.

1Host

03-03-2007, 03:01 PM

Isn't/wasn't there a site somewhere that more or less "exposed" all these overselling and "unlimited" offers? It would be great to provide a link for the inevitable client query: "Hey, how come I only get x disk space for $x per month from you guys, when I see advertisements for 1Billion TB of disk space for $.99/year"?

utropicmedia-karl

03-03-2007, 05:53 PM

bob_field

03-04-2007, 12:40 PM

Keep offering what you can afford, and target specific customer areas.

heavypredato

03-04-2007, 01:42 PM

Yes some ppl just want to exploit these insane hosts - usually they have porn websites.
Most of normal plans hosts dont need to worry too much.
You get what you pay for = common sense.
Sooner or later hosts that offer insane plans get burned and their clients with them.
It is simply not caring about your clients if you offer something like that.

bwb

03-04-2007, 04:32 PM

Yes some ppl just want to exploit these insane hosts -
Most of normal plans hosts dont need to worry too much.
You get what you pay for = common sense.
Sooner or later hosts that offer insane plans get burned and their clients with them.
It is simply not caring about your clients if you offer something like that.
Not always, the hosts doing it are large cheap hosting companies and they have realized that bandwidth and diskspace are just marketing terms, normal small sites don't use any real amount so they can offer them huge amounts and bury in the tos/aup the real limits which are cpu/mem usage. So if your site gets bigger and starts using more of the cpu or so on they can say hey you are not fit for shared hosting, and that is true in some cases.

Martie

03-04-2007, 05:27 PM

zwolf

03-04-2007, 05:39 PM

The most insane offer I have seen so far was for 3000GB disk space with 11,000 GB transfer for $16.95 per month. While I understand it is a good marketing stratagy, the biggest problem I see with it is, people are starting to beleive they actually need this kind of space, and are clueless as to what they need any more.

Overselling I think is ok, but I think some companies are going way over board. If people will only buy these insane packages, I think it will force more companies to have no choice but to follow suit if they want to compete. Just for some proof: c a n a c a . com

bwb

03-04-2007, 05:43 PM

allspiritseve

03-04-2007, 06:03 PM

What would a site contain that would be able to give accurate ratings for web hosts based on current or previous service? If somebody started one, based on the idea that no site could pay to get preferred visibility to their services, do you think this site would be popular?

I have some time on my hands and a little money, and might be interested in starting something up like this, if people thought it'd be supported. Maybe something in the vein of resellerratings.com for hosts, with daily or weekly emails about specials from hosts? Seems like it could work...

Cory

rushweb

03-04-2007, 07:38 PM

I have not yet started a web hosting business. I have all of the tools but am still researching and working on my business plan. I only plan on targetting my local market as all of the current hosts in my local market are falling short in my opinion.

My biggest issue for me is overselling and price matching with the larger national hosts.

I know that I can get around this and prove myself to local customers but it will be a constant struggle.

I was thinking, as a few people here seem to be upset about overselling and have thrown a few ideas around, that I would share mine.

It has been mentioned that oversellers have protections in their TOS to actually prevent people from really taking advantage of "unlimited plans" and low prices. What if a guide or information -pdf was created by industry people against overselling that pointed out the pitfalls and negative side to overselling and the tactics used by companies that oversell. Such as the CPU usage, actualling using all of the space or bandwidth provided, etc...

If this was prepared by a few knowledgable people it could then even be resold for a small fee to honest web hosts to display on their page or send to customers that want to leave to inform them.

Personally I would never host with a company that promises unlimited everything or 1000gb space for $9.99. I always have felt that if it sounds too good to be true it probably is. I've seen dreamhost, etc and the several times over the years where I have needed just a virtual account I have stayed clear of such hosts.

zwolf

03-04-2007, 07:51 PM

By: rushweb
What if a guide or information -pdf was created by industry people against overselling that pointed out the pitfalls and negative side to overselling and the tactics used by companies that oversell. Such as the CPU usage, actualling using all of the space or bandwidth provided, etc...

Not a bad idea in my opinion. ;)

siforek

03-04-2007, 11:26 PM

Not a bad idea in my opinion. ;)

Wile reading this post I had an idea...
There's tons of Web Hosting Review site, which many customers will use to decide on a host. Why not put together a site for "true honest web hosting education"?

Seriously. Lets inform customers about overselling, educate them on the industry. Although there's always going to be those who want more for less, we can prevent many from learning the hard way.

I see no reason why this couldn't be successful if we joined together. Let's rebuild this market.

bwb

03-04-2007, 11:35 PM

Wile reading this post I had an idea...
There's tons of Web Hosting Review site, which many customers will use to decide on a host. Why not put together a site for "true honest web hosting education"?

Seriously. Lets inform customers about overselling, educate them on the industry. Although there's always going to be those who want more for less, we can prevent many from learning the hard way.

I see no reason why this couldn't be successful if we joined together. Let's rebuild this market.Good luck, I don't think the majority of consumer will ever be that smart, I think if anything consumers get hurt once and then they go learn, that is what happen to me so many years ago. So if anything the big crappy companies educate them for the low rate of 6.95 a month :). Plus i don't think these huge numbers are necessarily bad, they are just marketing, i think lots of big companies are good at what they do and have good support, so if they market this way its ok as it really is just marketing terms and not reflect their service. Its the same service as when they didn't offer much in terms of bandwidth/diskspace.

Plus how would you reach them before they buy? I've been saying this stuff on my blog at webhostingunleashed and rg for a year at least but most people don't care. They just need cheap hosting.

siforek

03-04-2007, 11:46 PM

Cheap is fine, it's what's offered for that price.

billionaire

03-04-2007, 11:55 PM

These plans are quite fun to test out. I own a large entertainment site and usually use around 190-200gb of bandwidth perday and I have signed up for these hosting plans here and there for transfering data, and it takes around 1-2 days to get kicked out. Dreamhost by far took the longest time. They always have backup agreements, such as how much CPU memory you can use etc, and you will be in violation of one of their terms if you even come close to using all their bandwidth.

rushweb

03-05-2007, 02:32 AM

Good luck, I don't think the majority of consumer will ever be that smart, I think if anything consumers get hurt once and then they go learn, that is what happen to me so many years ago.

Plus how would you reach them before they buy? I've been saying this stuff on my blog at webhostingunleashed and rg for a year at least but most people don't care. They just need cheap hosting.

That's why I said that it should be a PDF or text document, that way it can be distributed and used directly on websites of hosts who are against overselling. Maybe use portions of the text of the document or the entire document via a link on the "about this company" page, the order form or on the hosting plans pages... etc.

siforek

03-05-2007, 03:37 AM

That's why I said that it should be a PDF or text document, that way it can be distributed and used directly on websites of hosts who are against overselling. Maybe use portions of the text of the document or the entire document via a link on the "about this company" page, the order form or on the hosting plans pages... etc.
I see what you mean. Or even a "no overselling" organization with rules an such. Then we could all get a certificate/seal to put on our sites. Just an idea.

siforek

03-05-2007, 04:47 AM

http://en.wikipedia.org/wiki/Overselling
Add to that if you can. I did what I could.

bqinternet

03-05-2007, 11:40 AM

siforek

03-05-2007, 11:48 AM

The best way to compete against hosts offering such rediculous plans is for you to offer reasonable plans! You'll make a profit and have a stable business, while the other guys struggle to stay in business.

I didn't notice Matt Heaton of Bluehost struggling much as he sped off in his Viper the other day. :rofl:

LaneHost

03-05-2007, 03:51 PM

The best way to compete against hosts offering such rediculous plans is for you to offer reasonable plans! You'll make a profit and have a stable business, while the other guys struggle to stay in business.

I couldn't agree with you more! Something along the same lines I was going to say.

bwb

03-05-2007, 05:50 PM

Ya you guys are entirely missing the point, just because its ridiculous doesn't mean its not a way to run a business, in fact the big hosts are realizing that bandwidth/diskspace don't matter and are just marketing. If you are a smaller host and competing on numbers its not going to work anyway, small host get niches and operate in those and big general hosts compete on numbers and perceived value.

Plus any site that is doing 40GB a month or so on intensive php scripts is not going to be allowed to go on any shared plans, and if it is you are lucky, shared hosting is not for busy sites, its for small sites not many people visit. Big sites need a vps or dedicated.

Learning_as_I_go

03-06-2007, 11:38 PM

Glad to see this thread as this is something that I've also been struggling with as well. I agree that there is so much greed where customers are concerned. I'm also constantly being reminded how undervalued our market is. Everyone depends on their web site and e-mail but they don't want to pay for it.

mrzippy

03-07-2007, 05:12 AM

I agree with bwb. The hosting companies that offer these huge packages are simply viewing disk/bandwidth as a commodity.

Their business is operated and based solely on superior marketing.

The issue isn't that it can't be done (to offer huge plans at low prices), but that it might be considered a little "unethical" since there are tons of TOS clauses that are necessary in order to make it work.

But as far as a legitimate business method.. it is perfectly viable, and obviously works well. (Since there are lots of large companies that all do exactly the same thing... and many of them are now reporting profits).

I have recently thought that I might start a new brand (unrelated to my current premium brand) and do some test marketing to see what kind of numbers I can pull with a huge package for low cost.

unity100

03-07-2007, 07:01 AM

It would be nice if the industry was regulated. Then the body could limit this bs and have minimum package costs assigned to all hosts.

regulation is not needed for online businesses.

internet community auto-creates their own control and rate mechanisms, like wht, like find any host.com sites, rate my host com. sites, better business bureau and the like.

This 'rating and regulating' process is done BY the people on internet, like open source. As you already know, open source processes have tremendous processing power - and no regulatory board, governmental/international organisation and etc can reach the whole community's processing power.

It would be good if we were able to use such 'citizen's regulation' mechanisms in real world politics too.

Ramprage

03-07-2007, 12:20 PM

The best way to get back at them would be to purchase the plan and use it.

yeah or just don't use the provider any longer. I would stick with using all the bandwidth then closing the account :D

mheaton

03-29-2007, 01:10 PM

bwb

03-29-2007, 01:19 PM

mrzippy

03-29-2007, 01:27 PM

... do you agree that bandwidth and diskspace have just become marketing terms used by bluehost/hostmonster and other big hosts?

The real limits for shared hosting is the cpu/memory usage and on a basic level just how busy your site is combined with what software you are using. No site that uses even half of what you offer in a month is going to be allowed to stay on a shared box.

Have a look at Matt's blog. (http://mattheaton.com) He's posted several times about how excited he is that his tech folks are finding ways to tweak the linux kernal so better tracking of cpu utilization (and files, memory, etc) will eventually be available.

It's interesting reading.

Personally, I agree that disk space and bandwidth are just simple commodities. They are meaningless not because they are cheap, but because the average consumer does not even know what the terms mean. You could rename "diskspace" to "wizbang" and it wouldn't make any difference.

Customers want reliability, uptime, and "least risk possible". Anything else is just fodder for marketing. :)

Ramprage

03-29-2007, 01:45 PM

Why not educate your clients about what their sites are actually using?
Most client sites use under 50 megs space, why not emphasize that and focus more on anti-spam services bundled with hosting instead. Honestly who cares about how much space you have when you're trying to read your mailbox full of 100 + spam messages a day. Your clients will appreciate that you are providing them stuff that matters..... and no bulk, useless hype.

The majority of small businesses use their hosting for mail, I still wonder why providers are worried about the disk space/bandwidith numbers game..... its a race to nothing that no one cares about.

bwb

03-29-2007, 01:47 PM

heavypredato

03-29-2007, 01:48 PM

Ramprage

03-29-2007, 01:51 PM

I agree they jump ship and go for the big numbers, but they're getting something they;
1) Don't need
2) Will never use
3) Get wrapped up in this and miss the point that these mass space providers don't offer them sufficient anti-virus and anti-spam protection - or ANY AT ALL.

I'm just suprised I don't see providers promoting more anti-virus and anti-spam/spyware type security protection for clients. This would get great results if someone went about marketing properly.

NickWilsdon

03-29-2007, 02:15 PM

Interesting thread, HeavyPredator makes some good points.

I personally think small hosts can compete on service. Often the fact that you are small enough to understand each business and their needs makes the crucial difference. We get a lot of e-commerce clients, as they know we run fast, secure servers with few people on them. We're small enough to pick and choose who goes on which box.

In terms of over-selling. You can't compete with the big boys , it's an economy of scale. They can afford more servers and can handle it if people decide to push the limits.

As most hosts know though, the majority of people don't use a fraction of the bandwidth they think they need. You have to over-sell to a certain extent, but I would never take the TOS get-out - I always consider the outcome if people actually used that amount.

mheaton

03-29-2007, 02:38 PM

mheaton

03-29-2007, 02:49 PM

Some ppl may be thinking they will get dedicated server performance because they get so much space and transfer. In reality everyone knows they don't.

At some point "You agree that Bluehost may, under certain circumstances and without prior notice, immediately terminate your account and access to the Service." will come in handy.

So offering something you can't provide = just marketing. You may actually provide it but you will most likely not as cost will not be realy justified. Noone sane would sell full dedicated server for $7/mo.

btw. you are talking hour for ticket reply, I say 5 min. Smaller host can't provide better service? Looks like you are wrong. Btw. 80% renewals? 99-100% here. Don't tell me each month you lose xxxxx clients. That many didn't like the service? So

Just serious look at what is going on from my side :) Don't feel bad :)

Come now, this isn't true. Here are your numbers from the last month.

http://www.webhosting.info/webhosts/reports/total_domains/PRO-NET-HOSTING.COM

You dropped 4 domains in the last 30 days (About 5% in one month).

You have 88 domains TOTAL according to webhosting.info (Which means you maybe have 95 or so). It is ridiculous to compare your results with 100 total domains as a valid sample set. Sure you can give great service with 100 total domains, but you don't have any customers?!

If you really want to provide quality 24/7 support with real admins on staff all the time, and fully trained quality people I just don't see it happening until you are big enough to support it and in my opinion the MINIMUM is somewhere in the 5,000 customer range. Otherwise you just don't have enough resources/capital to make it happen.

We really don't compete with small one man operations. Most customers are very wary of these type of operations because their average "in business" time in less than 2 years. These operators move on to bigger and better things as their skills and monetary needs increase.

<<< Signatures need to be set up in your profile. >>>

heavypredato

03-29-2007, 03:04 PM

Come now, this isn't true. Here are your numbers from the last month.

http://www.webhosting.info/webhosts/reports/total_domains/PRO-NET-HOSTING.COM

You dropped 4 domains in the last 30 days (About 5% in one month).

You have 88 domains TOTAL according to webhosting.info (Which means you maybe have 95 or so). It is ridiculous to compare your results with 100 total domains as a valid sample set. Sure you can give great service with 100 total domains, but you don't have any customers?!

If you really want to provide quality 24/7 support with real admins on staff all the time, and fully trained quality people I just don't see it happening until you are big enough to support it and in my opinion the MINIMUM is somewhere in the 5,000 customer range. Otherwise you just don't have enough resources/capital to make it happen.

We really don't compete with small one man operations. Most customers are very wary of these type of operations because their average "in business" time in less than 2 years. These operators move on to bigger and better things as their skills and monetary needs increase.

Matt Heaton / Bluehost.com

Sorry ns1.pro (not mentioning these are not only ns on this server :) ) are nameservers that are used only on one server - and half of the domains there are private.
We operate local hosting companies in 2 countries and pro-net for int.
By looking at this you dont get the real numbers and your assumptions are simply way off.

btw. I'm not scared that I will lose clients to insane hosts - why? Because 99% of our clients are local clients that want local language support and need tax stuff kept simple. So don't take it as my personal attack on you. It's just my 2c to this conversation.

mrzippy

03-29-2007, 03:42 PM

I'm just suprised I don't see providers promoting more anti-virus and anti-spam/spyware type security protection for clients. This would get great results if someone went about marketing properly.

This is most likely because there is no "plug-in" spam fighting solution for the popular control panels.

Most folks would not offer "3rd party script installation" services if it wasn't for fantastico....

.. and similarily, most hosts will not offer above average spam fighting service until there is a plug-in solution available.

(I don't mean outsourced mail hosting or services... I mean a truly "plugin" and brain-dead simple spam solution that provides actual value, is easy to admin, and customers can actually use without requiring advanced reading of the technical specs.)

bwb

03-29-2007, 03:46 PM

like barricuda firewalls or something along those lines?

mrzippy

03-29-2007, 03:48 PM

like barricuda firewalls or something along those lines?
Yes. However, purchase and installation of a barricuda firewall or spam solution is not a cheap or easy thing to do...

If there was a "plug and play" service that plugged right into cpanel (much like fantastico does), then there would be a ton of hosts offering it as a solution.

unlimitedwebhost

03-29-2007, 04:50 PM

bwb

03-29-2007, 05:08 PM

These plans are hosts that oversell alot, sooner or later they will have to stop offering so much space otherwise they will start to lose money.
I don't really like to go for a host that oversells as that means client sites will get very slow.ahahahahahahahah, this from a guy with "unlimitedwebhost" in his signature. and who is selling plans for $6 bucks a month.

You didn't even read the thread at all... and no you are not right in anyway, everyone oversells and barely any clients use that space. What does it matter if a host says 1GB or 20000TB, nothing as the limits are cpu/mem/how busy the site is.

Useless post unlimitedwebhost.

unlimitedwebhost

03-29-2007, 05:17 PM

Thing is my plans are not overselling we keep within server limits, so our clients sites run fast and we do not overload our servers.

AHFB HTML

03-29-2007, 05:28 PM

You are kidding right????

unlimitedwebhost

03-29-2007, 05:48 PM

What do you mean?

bwb

03-29-2007, 05:54 PM

You are kidding right????
Apparently he is not :)

JohnCrowley

03-29-2007, 09:00 PM

Do I agree that disk space and bandwidth are only marketing terms? The short answer is no, I don't. We DO have customers that use 200 gigs of space and we DO have customers that use 2 Terabytes of transfer. I am the first to agree that we don't make any money on these customers and in fact lose money on these customers. Sure, bigger package numbers for disk space, bandwidth, etc drive sales, but most hosts could never allow a single customer to pull 10-20 Mbits continuously for 5 hours when their video on their site gets slashdotted, but we do. We add 2 terabytes of storage to our network EVERY DAY and have 4 diverse gig circuits of bandwidth and are adding a gig circuit about every 90 days at this point.But you do not advertise that the 2 TB of transfer will *only* work if it is a video stream. Now throw in a regular old WP blog that gets /dotted, and see how long that server stays up with 2 TB of transfers. The point is the average website with a mix of static and light dynamic content cannot fully utilize these "marketing terms" of beyond proportion specs. It is misleading at best. I feel sorry for the other clients on a shared server whose neighbors are pushing TB's of transfers and driving the load too high...

I do understand the other side of how larger hosts operate and compete, although we operate on a smaller scale...

When I see discussions about how a host can "survive" with these types of plans I don't get it? I can certainly understand if you are just starting and have 5 servers, but if you are a large host the hardware and bandwidth (At least in our case) just doesn't affect the bottom line that much.Except the little host with one server can get the same amount of output out of it as you can. You cannot get more out of each of your servers because of your sheer size and money spent per month. And us "little" hosts know that, understand it, and try to balance plan sizes with the realistic usage of all of our clients, not the statistical average.

That being said, I am EXTREMELY picky about the hardware we use. I come from a hardware background and design each of our servers designs myself. We build everything in house and use very high quality parts. All our servers in the last 6 months are at least quad processors with 4 gigs or more of RAM, Raid 1+0 (/ partition with mysql), and Raid 1 configs (/home), and have local backups on the servers as well as remote backups done daily, on the 15th, and the 30th of every month.No one said you were fly by night. Sounds like an average shared server to me. :)

In short, if we say we give it we do. Not everyone in the industry does this and consequently the shared market is soiled in negative publicity and mistrust. Your hosting choices must be made on an individual basis without throwing everyone into the same pot.Sounds like marketing speak again. I'll agree you are a great marketer, but please do not try to sing the song of altruism and how every customer matters, as I know (and I assume others know) that you say, hey, if we can please 80% of the clients 90% of the time, then we'll accept the 15% that we either suspend, cancel, or drive away who innocently believe the hype we sell and try to use what they think the plan comes with... I've been doing this longer than you (yes, since 1995) and I know full well how the numbers game works when it comes to guerilla marketing and ultra aggressive new signup rates to fuel the large affiliate and advertising campaigns in a never ending viscious circle.

- John C.
(Just a little "sane" guy)

JohnCrowley

03-29-2007, 09:18 PM

This whole thread is missing the point. I run Hostmonster and Bluehost as if our customers are paying $100 a month instead of $5-$8 a month. If they like our service and if we bend over backwards for our customers then they will stay. It won't matter that the competition says "They can't provide service and resources like they say they can!" because the customer knows that we can. People on our service don't leave. We have between 80-85% renewal rate month after month. That doesn't happen if our customers aren't satisfieid.End self inflated post #1. :)

We all say we treat our clients like gold. We treat our $100/month shared clients as if they are paying $10,000/month, so I guess we care even more. ;)

Stats are great, but I feel companies like yours that try to represent themselves as "business class" hosting for the price of a happy meal are doing a dis-service to this industry as well. I have no problem when hosts market lower cost hosting in a fun and free way (ala dreamhost), but when they try to say businesses should only pay $84/year for the ultimate in service and support, that is stretching it quite thin.

We had over 700 tickets yesterday and less than 10 that weren't answered in 1 hour or less. We took over 900 chats yesterday and had no missed chats, and we took almost 1 thousand calls with an average hold time of 46 seconds. When I hear that "smaller hosts" can/do provide better service I totally disagree. There is a reason why we add almost 30,000 domains each month and it is a LOT more than price! There are many hosts with our exact same price that don't do well at all. It's a lot more than the hosting packages as well.End self inflated post #2

Well, you must have the best and smartest clients in the world with average stats like that. We pride ourselves on customer service, have great FAQ's, KB's, newsletters, articles, etc... and if I extrapolate out (sorry, I do not have 300,000 clients to match up exactly) we would have 7,000 tickets per day and 5,000 calls per day. You must have the best run host on the planet, and if so, I guess I'm not being sarcastic... Price may not be everything, but offering more than what can be provided for a price that is well below the industry average for a prolonged period of time is a recipe for either disaster or another numbers game where you sacrifice the few for the overall gain of the company.

How does an income of 2 million per month (fiuzzy math 300,000 times $7) pay for your claim of $1 million per month in advertising/marketing costs, $150-200k in hardware costs, an affiliate program paying out 1 million+ per month, and those pesky employee costs (I'm guessing a staff of 100) soaking up $500,000+ per month? I guess you have to sign-up 30,000 per month just to stay ahead of the wave...

So please, enough about how we exploit our customers for money and then boot them off our servers when we don't give them what our hosting plans offer. Its simply not true, and we have 350,000 domains between Hostmonster and Bluehost to prove it.End self inflated post #3

But between you and I, you know it happens; the percentages are so low (what's a 4% termination rate between friends), it makes it OK. ;)

I do enjoy you joining our lively group though, it certainly spices things up. :D

- John C.

Aussie Bob

03-29-2007, 09:25 PM

. . . If you really want to provide quality 24/7 support with real admins on staff all the time, and fully trained quality people I just don't see it happening until you are big enough to support it and in my opinion the MINIMUM is somewhere in the 5,000 customer range. Otherwise you just don't have enough resources/capital to make it happen.
Of course that depends on the pricing of the plans. One host has 5,000 clients @ a few bucks per mth, and another host could have the same revenue with 1,000 clients. The number of clients is only one factor when revenues and staff levels are concerned.

BTW, reading on your blog (http://www.mattheaton.com/) that you have 5 children. Brave man, but I'm one ahead of you. You can catch me and overtake me if you like. I'm retired from the breeding business. :D

JohnCrowley

03-29-2007, 09:28 PM

...
You have 88 domains TOTAL according to webhosting.info (Which means you maybe have 95 or so). It is ridiculous to compare your results with 100 total domains as a valid sample set. Sure you can give great service with 100 total domains, but you don't have any customers?!
...
We really don't compete with small one man operations. Most customers are very wary of these type of operations because their average "in business" time in less than 2 years. These operators move on to bigger and better things as their skills and monetary needs increase. Watch the low blows. We all know you are mighty and drive a Viper, and have clients coming out of every orifice. No need to rub it in. ;)

Why not be honest and say that bluehost does not work for many types of websites that would try and use what they purchased, that your one hour response times are good, but overall resolution times are much much longer, and that your very sharp marketing skills are what keep that revolving door spinning, and just enough TLC to keep 80% happy and with your company day to day. :)

- John C.

Aussie Bob

03-29-2007, 09:31 PM

I do enjoy you joining our lively group though, it certainly spices things up. :D
hehe, you bet. Just waiting for cowabunga so slide in and we'll see some real action then. :dgrin:

Bob, the tiny 12 server host with a wife and 6 kids. :angel:

Galaxy-Hosts

03-29-2007, 09:45 PM

Bob, the tiny 12 server host with a wife and 6 kids. :angel: Hey , thats a nice sized business if you have the right clients that appreciate honesty, and support. Some people are willing to pay not to have to deal with a TOS full of hidden "gotchas".

mheaton

03-30-2007, 02:13 AM

mrzippy

03-30-2007, 02:19 AM

So you're saying you have more developers working on cpanel... then cpanel does?

;)

(That wouldn't surprise me...)

HC-Sam

03-30-2007, 02:58 AM

I was pissed at first when I saw HostMonster doing the same for $4.95(now 5.95/mo), now I've realized that they get "non educated/experienced" customers. That's their target, and they can have all of them.

Ha, but there are only so many customers ...

JohnCrowley

03-30-2007, 08:01 AM

Actually we don't only allow users to use their 2 terabytes just for video. I used video as an example?!?! They can do whatever they want with their bandwidth (No adult sites, or warez).

We have sites using Wordpress and other blogging software on Slashdot and Digg all the time. Rarely do we have any server problems because of it.

You also made a comment about shared hosting that is simply not true. You said that you and other small companies can get the same performance out of server that Bluehost and Hostmonster can. Rubbish!!! We have spent an enormous amount of money with many of the most talented developers and kernel developers to get maximum performance from our Linux stack. We have over 200 complete replacement pieces of software for Cpanel that get rid of huge efficiencies, and our file system IO enhancements put every datacenter we have tested to shame. We are anything but a standard Cpanel shop. I hate to sound ultra confident, but things really aren't on an equal playing field. Because of our large development team we have an environment to create a shared hosting platform that is miles ahead of most of our competitors. How can I say this? Because I have been given root access on many of our competitors servers for testing. Crazy? Nope, we often work together to make things better and I have looked at a LOT of servers lately. Its not even close. Maybe you think its all marketing fluff. I don't, and neither do our customers.So I guess complaints such as this are just *rubbish* as well?

http://www.webhostingtalk.com/showthread.php?t=579874&highlight=bluehost

Or the complaints on your own forums about overloaded shared servers, etc... Cpanel is not optimized at all, so improving that is not that great. With a few "standard" kernel tweaks, some hardware RAID and hdparm tweaks, etc... you can ramp up Linux quite well. Although I'm not making light of your development efforts, I do not think you can get uber performance to be light years ahead in terms of shared hosting.

You have around 400 servers (or so says your sysadmin) and 300,000 (ish) domains (maybe not actual customers), so you put about 750 accounts on each server (more fuzzy math). With each customer being allowed 200 GB of space and 2000 GB of monthly transfer, you really put the OVER in oversell. Now if just 1% of your clients use 1000+ GB in a month of transfers, and as you say many use WP, dynamic content, etc..., these shared servers must each be pushing 10 TB + per month, and not a blip of loading issues on your radar... Houdini has entered the building! ;)

- John C.

AH-Tina

03-30-2007, 08:53 AM

You have around 400 servers (or so says your sysadmin) and 300,000 (ish) domains (maybe not actual customers), so you put about 750 accounts on each server (more fuzzy math). With each customer being allowed 200 GB of space and 2000 GB of monthly transfer, you really put the OVER in oversell. Now if just 1% of your clients use 1000+ GB in a month of transfers, and as you say many use WP, dynamic content, etc..., these shared servers must each be pushing 10 TB + per month, and not a blip of loading issues on your radar... Houdini has entered the building! ;)

- John C.

Have we found out what the specs are on those servers? Just curious.

--Tina

TonyB

03-30-2007, 09:29 AM

mrzippy

03-30-2007, 10:03 AM

Here's the problem shared hosting is not measured in CPU or RAM but rather just space and bandwidth. So unless everyone starts charging based on CPU and RAM whether the host is overselling or not they'll be suspending sites.

The problem is that there are very few tools to allow a typical shared hosting company to monitor and manage their customers based only on CPU and RAM utilization.

How would you market it? Customers have no idea what "cpu" and "ram" means. It would be like telling them there is a fairy inside the server and sometimes the fairy says they're using too much sunshine so their account will be suspended.

Diskspace and bandwidth are easy concepts to understand, and so they are used as "benchmarks" by most customers to see if a company has a good offer or not.

sigma

03-30-2007, 10:04 AM

We have over 200 complete replacement pieces of software for Cpanel that get rid of huge efficiencies...

Yeah, you've got to get those pesky efficiencies out of there, believe me.

I'm sure you run a great company. On the other hand, you would be amazed how a little humility can benefit your business relationships. Or your daily life.

Kevin

JohnCrowley

03-30-2007, 10:28 AM

These topics are stupid and it's amusing to see hosts not overselling argueing how a user could never use the resources without being suspended and how basically their service a user could always use their resources and have no issue. Well guess what people can make sites that can rip through your CPU and RAM like nothing and not even come close to say 15GB of bandwidth a month. I'm sure you'd suspend them just the same as an overselling host would. Otherwise you'd start losing money on a guy who can use entire servers. Of course you can come up with scenarios to make any situation untenable, but when you oversell by extreme amounts, and then boast how no one gets shut off, that goes beyond reasonable expectations.

Here's my litmus test. Can the average website using a mix of static and popular dynamic content (i.e. Wordpress) use all of the space and bandwidth allotted to them in any given month having a normalized distributed traffic pattern (i.e. no /dot). If not, then there is a problem with the plan's size, # of accounts on server, etc... YMMV

On the other hand, you would be amazed how a little humility can benefit your business relationships. Or your daily life.Spoken like a true professional.

- John C.

scribby

03-30-2007, 11:40 AM

How to ... Fighting Back against the Insane 200GB Plans

Um offer 400GB Plans, and run em outa town?

mheaton

03-30-2007, 06:04 PM

Yeah, you've got to get those pesky efficiencies out of there, believe me.

I'm sure you run a great company. On the other hand, you would be amazed how a little humility can benefit your business relationships. Or your daily life.

Kevin

Your type of humility is saying that we aren't better than other hosts because we really are all the same right? Come on? I am not saying we are perfect in every way, but I am saying we are miles ahead of most of our competition. Take that as pride if you want, I look at is as the result of an enormous amount of work and dedication. Hopefully you will see why I take issue with the fact that so many small hosts think they can run out and buy Cpanel and think they have the same offering as us. They don't.

HypedHost

03-30-2007, 11:02 PM

from 6 years experience, it isn't that hard to give out that much. I have seen boxes that only cost $140 a month and you get a TB of space and unmetered bandwidth. It is just a matter of finding that great offer/deal. I think the whole "getting back" thing is kind of unprofessional and rude. Tone aside, just because someone can offer something more than that of your's doesn't give you the right to bash/abuse that host. If the buyer is smart, they would stay away from cheap plans with tons of space. Many of those companies put in their AUP/TOS that any accounts reaching 5-10% CPU usage will be suspended when hosting media content. Some wont allow you to host your personal files on it, such as CD's and other things that can be deemed illegal by copyright infringement.

An old friend of mine had an unmetered box and pushed out 5TB of bandwidth in less than a week by hosting ShoutCast servers and 2 video ShoutCast servers pulling in a lot of listeners/viewers. At least, thats what he said. However, he did show me the plan he got which had an unmetered bandwidth box.

Eat Crow

03-30-2007, 11:56 PM

Your type of humility is saying that we aren't better than other hosts because we really are all the same right? Come on? I am not saying we are perfect in every way, but I am saying we are miles ahead of most of our competition. Take that as pride if you want, I look at is as the result of an enormous amount of work and dedication.
I believe 'hubris' is likely the proper term here. ;)

Hopefully you will see why I take issue with the fact that so many small hosts think they can run out and buy Cpanel and think they have the same offering as us. They don't.
That is obviously the most confounding issue here I would think... Why would you as the CEO of a successful, fast growing company have such thin skin and worry about what the smaller hosts think? There is no reason to take issue what the small host perceives itself to be, as you should be comfortable with what you and your company have accomplished and your standing in the industry.

You responses come off as petulant and result in the opposite effect... reducing your credibility and leaving one to believe that you are not as confident in your business model as your words would lead others to believe.

WN-Ali

03-31-2007, 12:45 AM

<sarcasm> Lets all go on a rampage against all the multi-million dollar companies because their business model is killing *our* business. </sarcasm>

mheaton

03-31-2007, 12:53 AM

WN-Ali

03-31-2007, 01:11 AM

A company with thousands of servers and customers can offer this much, it's as simple as that. If 100 out of 100,000 customers use the 100% allocated disk space and bandwidth, it would not do any harm because they are still making a great amount of profit from the other 99,900 customers which allows them to be able to accommodate the 100 customer needs. Out of the 100 customers, 90% are kicked off for cpu/memory abuse, so the 10 customers barely cost them anything.

Maybe I need some sleep :uhh:

bullfrog

03-31-2007, 02:50 AM

I've said it before and I'll say it again. Having such high disk space and transfer packages directly contradicts what shared hosting is. Shared hosting is for smaller websites that are just starting out or that have low bandwidth and cpu requirements. Once they outgrow shared hosting, there will be no option but to move to something with a bit more oomph (vps, dedi,etc). So here you have hosts promoting high usage for an evironment not meant for high usage.

But on the other hand you have economy of scales which makes it possible for them to do it. They will have a much harder time managing and keeping their servers stable and fast. They will have a harder time running the show, but can afford to hire a lot of staff to take care of it.

As a small host I don't see any threat to my businesses. I have a different market and prefer not getting the same clients as these cheaper hosts. A lot of the clients that use these oversold packages will in majority of the cases have some bad experience with these host, will do a bit more research, then turn into my type of client... An informed user who doesn't need my help for every single thing. One that doesn't contact me too often and understands that there are other factors that could influence his access to his site and understands that just because his script doesn't work might, it doesn't mean that it's the host. Most of my clients contact me when they have issues, but understand that I can't rewrite their scripts for them. I'll help them with it and will do my best to get them up and running, even beyond the call of duty. That is my selling point right there. Why would I want to sit with the stress of managing and supporting 100 000 clients when I can survive with 200 clients?

I would even go as far as saying some of these hosts, especially the bad ones, are creating users that I want. They are getting users to do a bit more research, what more can I want!

One thing that does get me a bit more than these big companies is the small hosts trying to do the same. It works for the big companies for a reason, because they're big. Once a smaller company tries to do the same thing it just won't work. They'll go out of business very quickly if they try to pull it off.

Running an overselling hosting company just takes a lot more effort and planning than anything that the smaller hosts have to worry about. Starting off is much harder and you need a much bigger initial investment. You've basically got to manage to keep the company running for quite some time before showing any sort of profit and then risk not surving. You'll have to manage your expenses much better as you've got to support a lot more clients and will need more support staff. These companies are making so little on each client it would be hard to support these clients on a smaller scale. That's just the support side of it, then you have to still manage the servers and many other things us smaller hosts almost never have to worry about.

Also remember that the more clients you have the more likely you are to have a few unhappy clients. This combined with the fact that these hosts have a greater chance of messing up will create a lot of unhappy clients. Clients that will try to find a better home for his site by doing a bit more research...hopefully!

just my 2c :cool:

Aussie Bob

03-31-2007, 04:08 AM

Now I remember why I haven't been to webhosting talk in a couple of months.
Don't go too far. I've enjoyed your posts, and a host of your caliber participating here.
You are right, I am not confident in our business plan :) What was I thinking growing my hosting business into one of the top 5 fastest growing hosting companies in the world. Back to the drawing board for me.
I look at your one plan model and love the simplicity. I love the hostmonster site layout and model. Not sure about those extreme resource allocations, but hey, if it's working for you then more power to ya.

Aussie Bob

03-31-2007, 04:12 AM

Have we found out what the specs are on those servers? Just curious.
Yep, Matt mentioned the server specs -
All our servers in the last 6 months are at least quad processors with 4 gigs or more of RAM, Raid 1+0 (/ partition with mysql), and Raid 1 configs (/home) . . .

2Macs Jim

03-31-2007, 05:43 AM

Now I remember why I haven't been to webhosting talk in a couple of months.
You are right, I am not confident in our business plan :) What was I thinking growing my hosting business into one of the top 5 fastest growing hosting companies in the world. Back to the drawing board for me.
Blah...
Personally, I'd like to see you here and active more often. Although some of us may disagree with your business model, if we can all be a little less confrontational, we can all get a better understanding of one another. You bring a different perspective to the table, which is always a good thing.

siforek

03-31-2007, 06:56 AM

This topic really took off since I last was here.

I don’t quite understand all the animosity towards Matt H. More that you wished you’d accomplished what he has. Yes, there are disadvantages of overselling(CPU), but I’d rather that than a $5k server just sitting there, not being utilized.

I read an article once, don’t remember where or by whom. It mentioned the advantages of keeping a server full rather than a non-oversold/un-used rack just to say “we don’t oversell”. I’ll try to dig up a link.

I guess everyone who thinks it is has their own reason why overselling is wrong. Matt H. is in a position where he can oversell and manage to keep a quality service, unlike us small guys.

I think many of you are just upset because there’s no way you could compete. I wouldn’t even try. I’d rather grab a seat & wrap my brain around some million dollar ideas.

Just my 0.02
BTW. Despite my post, I don’t oversell…. Yet.

btw. I'm not scared that I will lose clients to insane hosts - why? Because 99% of our clients are local clients that want local language support and need tax stuff kept simple.

Bluehost does all their support from Orem, Ut.

AH-Tina

03-31-2007, 07:28 AM

This topic really took off since I last was here.

I don’t quite understand all the animosity towards Matt H. More that you wished you’d accomplished what he has.

No, I think its more that some of us understand the extreme overselling model and why it works...and it does work nicely. Its Matt's spin on the truth that bugs us.

Basically, volume sales with the understanding that there will be a turnover rate consistent with the number of clients who can't use all that they thought they could (or who get stuck on a server with a client who tried). Since there's always 5 new customers to replace the 1 disgruntled client that leaves (used those numbers as examples only) - its not a big deal.

I understand why Matt can't/won't say certain things about the business model. I wouldn't either. Its basic business sense 101 and I think that's what JohnCrowley is trying to point out. Its spin control at its finest. Every successful business does it and there's nothing wrong with it. Do I agree with the extreme overselling business model? Nope. But there's room in this industry for all different flavors of hosts...and I like it that way.

--Tina

JohnCrowley

03-31-2007, 10:01 AM

...How can I say this? Because I have been given root access on many of our competitors servers for testing. Crazy? Nope, we often work together to make things better and I have looked at a LOT of servers lately.So why not share some of your findings with the WHT community? Many of us here share our technical thoughts, ideas for improving the hosting model, etc... The reason I am taking "aim" at you is you puff yourself and your business up, rather than let your stature as a big successful host do the talking. You type of sharing and helping other hosts, yet you *slam* smaller hosts on this very forum, saying how you're "light years ahead" of them.

Your words do not ring true, and that is what bothers me the most. There are successful hosting owners here (sigma [Kevin] from Pair, Brent from hostgator to name a few) that do not get "crticized" as you do as they actually do contribute to the betterment of the hosting industry, only defend their company as subtely as possible when it is being unjustly accused, and comes across as "straight shooters" in normal conversation.

But, to each his own, feel free to think down upon us "little" hosts and the WHT community. Or, step up, swallow a little pride, and join a hosting community whose memmbership probably adds a lot to your bottom line each day. :)

- John C.

siforek

03-31-2007, 11:39 AM

At this point we're not talking business, it's drama more than anything. :argue:
I'm here to talk business, what about you?

I'm a "little" host determined to succeed, I'll take all the help I can get from those deemed successful. If I hear/read something that I don't believe applies I take it with a grain of salt because it does not apply.

To Moderators: Please create a "Web Hosting Drama" forum J/K.

SSHocker

03-31-2007, 11:47 AM

I think the market that goes for 200GB for $5.00 is full of the types of client you wouldn't want anyway

AH-Tina

03-31-2007, 12:30 PM

To Moderators: Please create a "Web Hosting Drama" forum J/K.

I think 90% of all threads would have to be moved there! :D

--Tina

mheaton

03-31-2007, 06:11 PM

[QUOTE=JohnCrowley]So why not share some of your findings with the WHT community? Many of us here share our technical thoughts, ideas for improving the hosting model, etc... The reason I am taking "aim" at you is you puff yourself and your business up, rather than let your stature as a big successful host do the talking. You type of sharing and helping other hosts, yet you *slam* smaller hosts on this very forum, saying how you're "light years ahead" of them.

Your words do not ring true, and that is what bothers me the most. There are successful hosting owners here (sigma [Kevin] from Pair, Brent from hostgator to name a few) that do not get "crticized" as you do as they actually do contribute to the betterment of the hosting industry, only defend their company as subtely as possible when it is being unjustly accused, and comes across as "straight shooters" in normal conversation.

Your shared hosting views are very limited in scope. I love how it is "assumed" that shared hosting works a single way and everyone like sheep accept it is fact. Let me give you a couple of examples of how we are different than other shared hosts and why not everyones product is created equal.

1) CPU in a shared environment can't be controlled or allocated. BS - We track cpu exactly for each customer in real time. I know exactly how many cycles each user consumes and all their processes. I can decrease or increase cpu cycles on an individual basis, and guarantee resources for any individual or group. If a server becomes an issue where it can't sustain the CPU load accounts are migrated automatically to new servers to ensure and guarantee resources. We use this to limit individual users from causing servers to spiral out of contol as well (Oh no we must block everyone for using CPU and Bandwidth). Here is a stat for you - 1.3% of our shared accounts experienced a 30 second ban on their account for CPU overage at least once in the last 30 day period). What?? I thought we threw out 20% of our users for using too much!?!? This type of tracking isn't even possible for most shared hosts as they don't even run processes as an individual users. They use TOTALLY insecure environments to gain "speed" such as mod_php, mod_perl, etc. These services are insecure and obtaining root is trivial. This type of tracking isn't part of Cpanel and is 100% written by developers at Bluehost. Let me give you a quick list of shared hosts that CAN'T do this. Ipower, Startlogic, Lunarpages, Hostgator, IXWebhosting, 1and1, and the list goes on and on.

2) Memory by user - We track (Again in realtime) memory usage by user. We won't allow any one user to consume too much and as resources are available we make more memory available for those users that need it so that even if a single user consumes a lot of memory it is just fine if it is free. This is actually the case more often than not and in most cases a user can literally use several hundred megs of memory on our shared system without a problem because use is almost always broken up and not needed on a sustained business.

3) Disk IO - Far and away the biggest problem on shared hosting is disk IO. CPU is a minor problem comparatively. I would argue that most hosts large and small don't even know where their disk IO problems are. Most "CPU" problems on a shared host are really disk IO related in my opinion. The processes are starved for IO and so they don't end and it looks like CPU issues because the processes don't end until their IO requirements are satisfied. Until the 2.6.20 kernel in linux this wasn't even possible in a measurable/trackable way (taskstats solves this problem, but no tools exist yet to show the data in a great way so we are writing out own). We have lowered our disk seeks by almost 30% in the last 90 days by tracking disks I/O and modifying how our system deal with the filesystem and the iO scheduler. This has consequently lowered our server load by almost 70%. Load is calculated not just by CPU, but by CPU and IO and the wait involved. We are VERY close to being able to guarantee and track disk IO by process and user/account/domain down to the number of physical read/writes/and seeks that each shared user incurs. This allows us to take the top usage users by IO and put them on a faster server set to solve their problems and limit IO deficiencies for the general user base. This isn't some basic IO tracking that is measured by vmstat, iostat, sar, etc, it is meaningful, detailed, and actionable. We fix the issues we find. Every host we have talked to without exception has not addressed the IO issues I discuss above in a meaningful way. I have given them help with basic information where I could, but our tweaks are much more than filesystem mount options and deciding to use something besides the slow EXT3 filesystem.

I am tired of users like you saying these issues aren't solvable, and that shared hosting can't accomodate users need. What you mean is that you can't solve these issues because I sure can, and have, and will continue to do so.

bwb

03-31-2007, 06:29 PM

I am tired of users like you saying these issues aren't solvable, and that shared hosting can't accomodate users need. What you mean is that you can't solve these issues because I sure can, and have, and will continue to do so.So basically you are doing everything possible to limit the problems associated with a traditional shared hosting environment. Do you plan on releasing this stuff under the GPL or so on? Or keep it as a market advantage?

JohnCrowley

03-31-2007, 06:50 PM

Your shared hosting views are very limited in scope. I love how it is "assumed" that shared hosting works a single way and everyone like sheep accept it is fact.
... (Technical explanation - very good btw)
I am tired of users like you saying these issues aren't solvable, and that shared hosting can't accomodate users need. What you mean is that you can't solve these issues because I sure can, and have, and will continue to do so.Well, that is a start to contributing, and I appreciate your insight into the problems of shared hosting. I'm not a big fan of you putting words in my mouth though, as I never stated issues weren't solvable, I never said you kicked 20% of your clients off your service (you said you retained 80% in a previous post) and your assessment of my "scope" is not based on anything I said... Now if you can just dull that razor sharp chip a bit, we'll get along a teeny bit better. ;)

I am not acting like a sheep to my knowledge, but sometimes in business you take what is currently widely available, and make it work for your clients. Your company has chosen a more difficult road of reinventing the shared OS to get more out of it. Both paths are equally valid though, as at the end of the day if the client gets what he or she wants, then the business has met the clients' needs.

I'll agree with you though on the IO issue, as no matter how much hardware we throw at a server, clients who publish large amounts of static pages, or work with db's with heavier writes always drive the load up more than any cpu intensive script. But I guess I'm not "brave" enough at this time to abandon the standard ext3 journaling FS to try and improve this IO issue in that fashion. We choose to limit the number of clients per server, run SCSI RAID, and make the plans more realistic to prevent problems from occuring in the first place.

Monitoring CPU and memory usage per user is actually quite handy when trying to balance a large number of clients on one server, and keep things running smoothly. And I understand you want to keep your technology advances to yourself to gain a competitive advantage over your "peers". :)

- John C.
(A wolf in sheeps clothing)

sigma

03-31-2007, 11:11 PM

Your shared hosting views are very limited in scope. I love how it is "assumed" that shared hosting works a single way and everyone like sheep accept it is fact...

They use TOTALLY insecure environments to gain "speed" such as mod_php, mod_perl, etc. These services are insecure and obtaining root is trivial.

Saying "obtaining root is trivial" involves a huge, insulting assumption about everyone's servers - now you're the one making assumptions. If you don't know how to secure a server, then root exploits are far more likely, yes, but trivial - absolutely not.

The assertion also doesn't make much sense, unless I'm missing something. Using mod_php, for example, means customer scripts are running as "nobody". How is that less secure than having them all run under real userids? If anything, you've exposed the customer account to greater risk by having the script run with greater privilege.

I agree with you on the rest. If you want to track CPU per user, you do have to fork everything (well, probably) - yes, it's less efficient. And disk I/O is a huge problem that is tricky to manage, no disagreement there.

Kevin

mheaton

04-01-2007, 01:41 AM

sigma

04-01-2007, 02:04 AM

Ok, lets talk briefly about why mod_php is 100% unacceptable in a shared hosting environment. mod_php by definition runs as a single user - Thats how it keeps PHP in memory and executes scripts faster for the average server which is great if you are the only one on it. If you run it as the "nobody" user as you mention above then any and all scripts (php scripts) that run on that box will execute and write files with the permissions of the "nobody" user. This is bad bad bad! Because user1 has files owned and writable by
"nobody" so does user2, user3, and every other user that executes any PHP script. If I am a hosting client of your I could simply write a few line program that goes into any of your other users directories and deletes all their files with "nobody" permissions which is everyone because you run mod_php. It astounds me that so many shared hosts run in this type of environment. All it would take is someone malicious to completely and repeatedly delete all your users content??

In most scenarios, that is inaccurate.

User files are owned by the user's account, not the nobody account. Those files cannot be overwritten by the scripts running as nobody. If a user script needs to create local data or access a database, it should be wrapped so it runs as the user. But for many scripts, that's neither necessary nor beneficial.

We've had much better results with the nobody user than what you're proposing, both in terms of performance and security. Every two-bit script out there that gets compromised, we can promptly flag it because the nobody account is easier to monitor (user accounts already have the privilege to do many things that the nobody account should not).

Keep in mind, those two-bit scripts usually come with two-bit instructions that tell the user to "chmod 777" everything when they can't get their script working, so there's the usual reason users have overwritable files - they don't take any steps to protect themselves (your scenario doesn't protect against "chmod 777" either).

Surely, a couple of CEOs have better ways to spend their time than this topic. Configure your servers as you see fit, run your business as you see fit, and God bless you. I think it would benefit your karma, though, to avoid saying you have the One True Way to run a server or a service, and to imply that anyone else is some kind of idiot or cretin. It's quite telling that you are "astounded" that people run servers any way other than yours.

Kevin

mheaton

04-01-2007, 02:43 AM

In most scenarios, that is inaccurate.

User files are owned by the user's account, not the nobody account. Those files cannot be overwritten by the scripts running as nobody. If a user script needs to create local data or access a database, it should be wrapped so it runs as the user. But for many scripts, that's neither necessary nor beneficial.

We've had much better results with the nobody user than what you're proposing, both in terms of performance and security. Every two-bit script out there that gets compromised, we can promptly flag it because the nobody account is easier to monitor (user accounts already have the privilege to do many things that the nobody account should not).

Keep in mind, those two-bit scripts usually come with two-bit instructions that tell the user to "chmod 777" everything when they can't get their script working, so there's the usual reason users have overwritable files - they don't take any steps to protect themselves (your scenario doesn't protect against "chmod 777" either).

Surely, a couple of CEOs have better ways to spend their time than this topic. Configure your servers as you see fit, run your business as you see fit, and God bless you. I think it would benefit your karma, though, to avoid saying you have the One True Way to run a server or a service, and to imply that anyone else is some kind of idiot or cretin. It's quite telling that you are "astounded" that people run servers any way other than yours.

Kevin

I am sorry, but you are totally wrong. Its not even arguable. This is basic permissions stuff. If it runs as nobody then any and ALL content created by a script in the users directory is writable by any other nobody user. This is security 101. It CAN'T be secure. I know thats hard to hear if your setup is based on mod_php but its true. If each user was insulated from each other then mod_php wouldn't be able to write to the directory which is obviously not the case or none of your users scripts would work. You can "hide" the directory from other users via some type of jailed environment but they can easily grab directory info via a script and delete files at will because the nobody user gets to read/write to EVERY user on the box. Mod_php, mod_perl, etc doesn't work. Ask any of the mod_php developers themselves and they will be the first to admit that it shouldn't be run in a shared environment for this exact security reason.

Boy, I just need to stay off the forums... I just can't let stuff slide without giving my thoughts and everyone just argues and doesn't believe it anyway :)

bullfrog

04-01-2007, 03:36 AM

Please don't turn this into an argument! I find this information posted above by both of you very valuable and know that it's something I'd need to look into.

@Matt: Please don't leave because of a few users. I believe that you have quite a bit of knowledge that you could share that would help out a lot of the users tremendously. The way you say things does make it sound like you think that you're always right, so that might be something to look at. Either way, I believe you're a valuable resource and believe that you should stay.

As for th issue above. What Matt says makes a lot of sense. If all scripts run as nobody and those scripts have rights to change the user who runs the scripts files, what's preventing them from changing others users php files?

Say we have 2 users with php scripts that can do things to certain files. Both users have files with permissions to allow the scripts to change those files. Obviously the files will have to have the permissions set right to allow the scripts to edit the files. So user one can edit his files and user two his with the scripts run as nobody. Now if user one were to take user twos scripts and run user twos scripts from his account, those scripts will still be able to modify user twos files. In this same way user one will be able to make a script to wipe out the content of user twos files, given that the files have the permissions set to be modifyable.

sigma

04-01-2007, 08:19 AM

I am sorry, but you are totally wrong. Its not even arguable. This is basic permissions stuff. If it runs as nobody then any and ALL content created by a script in the users directory is writable by any other nobody user. This is security 101. It CAN'T be secure.

It's not "arguable" because you aren't even reading what I write, apparently out of sheer obstinacy. A script running as nobody will create files owned by nobody. I did not say otherwise. What I said was that most scripts do not need to create files. Therefore, the only files we're talking about are the ones uploaded by the customer, which are owned by the customer's account and therefore not overwritable!

Not only are you pretty much ignoring what I'm saying, you're coming across as unbearably arrogant about it. I'm embarrassed for both of us.

If each user was insulated from each other then mod_php wouldn't be able to write to the directory which is obviously not the case or none of your users scripts would work.

I'll say it yet again. Most scripts do not need to write files in order to run.

Ask any of the mod_php developers themselves and they will be the first to admit that it shouldn't be run in a shared environment for this exact security reason.

Please, go find one.

Kevin

sigma

04-01-2007, 08:26 AM

As for th issue above. What Matt says makes a lot of sense. If all scripts run as nobody and those scripts have rights to change the user who runs the scripts files, what's preventing them from changing others users php files?

Why would a script running as nobody have the right to write to any files owned by a user account? It doesn't have those rights; the premise is false. The only way it would be able to write to files it doesn't own would be if the permissions are wrong (files 666, directories 777, for example), in which case any user account could do the same thing.

Say we have 2 users with php scripts that can do things to certain files. Both users have files with permissions to allow the scripts to change those files. Obviously the files will have to have the permissions set right to allow the scripts to edit the files. So user one can edit his files and user two his with the scripts run as nobody. Now if user one were to take user twos scripts and run user twos scripts from his account, those scripts will still be able to modify user twos files. In this same way user one will be able to make a script to wipe out the content of user twos files, given that the files have the permissions set to be modifyable.

Why on earth does everyone keep assuming that for a script to execute, it has to be overwritable itself or has to be able to overwrite other files? That's a completely separate issue.

It's interesting that Mr. Heaton thinks someone compromising a "nobody" script and running "rm -rf" and perhaps deleting some temp files is worse than the same compromise in a 100% wrapped environment - in which case the same "rm -rf" just wiped out the user's account. Or a sophisticated attacker could just backdoor the user's account (via .login, for example). None of that is possible in the "nobody" account.

Kevin

mheaton

04-01-2007, 11:40 AM

layer0

04-01-2007, 11:48 AM

sigma

04-01-2007, 12:45 PM

You still don't get it? The nobody user has FULL 100% WRITE ACCESS to all your user directories and all your users can run anything they want as nobody? Your assertions that scripts don't create files in home is looney, and dangerous for your users. So basically you would be saying that unless it was a MySQL write that nothing is ever written by a script?!?!? :)

In other news, the world is confirmed to be flat afterall, up is now down, and down is now up, and gravity was just a fad and no longer affects us. Its true - user sigma told me so!

Wow, you are really off your rails. That last paragraph is so classy.

I will say it one more time - you are flat wrong. User nobody does not have write access to user-owned directories or files. A script owned by a user can run as user nobody without having any additional privileges.

You see, a process running under one userid cannot overwrite files owned by another userid, unless the files are world-writable and therefore overwritable by anyone. This is fundamental UNIX - are you perhaps a DOS user? Do you actually use UNIX? Do you need an example to show the obvious? For example, a PHP script owned by my account, running as user nobody, that can't write to the directory it's running in because my account owns it. Simple as can be.

And of course, many scripts have no need to write files. Scripts may very well just want to send output to the user, you know.

I'm amazed that now your cluelessness seems to be struggling to outstrip your arrogance. And that's a tough battle.

Kevin

2Macs Jim

04-01-2007, 12:52 PM

bwb

04-01-2007, 01:07 PM

Guys, guys, let's not argue.:D Matt may have a different approach about him but give him time, he'll get used to us and hopefully we'll get used to him. Is he somewhat cocky and arrogant? To be honest, I really wouldn't expect anything different. He's not cocky and arrogant because he owns Bluehost and Hostmonster, he owns Bluehost and Hostmonster because he's cocky and arrogant. I'm not condoning it, I'm just saying many people are like this. He brings up some very interesting points and a different approach to things. I think if we can all get past each others views and occasional bs, Matt might become a very good addition to our little community. After all, that's what this forum is all about.Forums are also places where a little civility is needed, esp a business forum that prospective customers might read. This isn't a forum about religion or something people will call others names and scream at.... I could be wrong though from posts. Also arrogance and lack of humility are not prerequisites for running a successful business.

bwb

04-01-2007, 01:19 PM

mheaton

04-01-2007, 01:32 PM

Wow, you are really off your rails. That last paragraph is so classy.

I will say it one more time - you are flat wrong. User nobody does not have write access to user-owned directories or files. A script owned by a user can run as user nobody without having any additional privileges.

You see, a process running under one userid cannot overwrite files owned by another userid, unless the files are world-writable and therefore overwritable by anyone. This is fundamental UNIX - are you perhaps a DOS user? Do you actually use UNIX? Do you need an example to show the obvious? For example, a PHP script owned by my account, running as user nobody, that can't write to the directory it's running in because my account owns it. Simple as can be.

And of course, many scripts have no need to write files. Scripts may very well just want to send output to the user, you know.

I'm amazed that now your cluelessness seems to be struggling to outstrip your arrogance. And that's a tough battle.

Kevin

Tell you what? Give me an account on one of your servers for 72 hours. Nothing special, just give me access to mod_php like all your other users and put me on a server with other user accounts. I won't do anything destuctive but I will be able to not only list every "webable" file for every account on your server, but I will also "touch" (create a 0 byte file) a file in the directories of every single one of your users. I'll even give you all the source code for the breach so you can fix it on your end? If I am wrong then I am embarressed on the forum and will publicly admit to everyone where I made my mistake, otherwise just admit that ALL "nobody" created files or 777 files can be deleted at will by any user.

I admit that I have been a little rude in my above posts. I apologize for that, but I certainly don't apologize for being right :)

mrzippy

04-01-2007, 02:17 PM

<BEGIN ATTEMPT AT HUMOR>

I admit that I have been a little rude .... I apologize for that, but I certainly don't apologize for being right :)

I said this exact same line to my wife after an argument yesterday. :D

</END ATTEMPT A HUMOR>

In all seriousness, I have to admit that I do enjoy Matt's posts. He does make interesting points, regardless of whether I agree/disagree or think he's right/wrong.

My point -- Matt I hope you stick around here and keep contributing. WHT is an "interesting" place, and having you around is valuable to the community. It's good to have differences of opinion and vibrant discussions.

:)

sigma

04-01-2007, 02:19 PM

Tell you what? Give me an account on one of your servers for 72 hours. Nothing special, just give me access to mod_php like all your other users and put me on a server with other user accounts. I won't do anything destuctive but I will be able to not only list every "webable" file for every account on your server, but I will also "touch" (create a 0 byte file) a file in the directories of every single one of your users. I'll even give you all the source code for the breach so you can fix it on your end? If I am wrong then I am embarressed on the forum and will publicly admit to everyone where I made my mistake, otherwise just admit that ALL "nobody" created files or 777 files can be deleted at will by any user.

$8.95/month gets you a regular account with SSH access; there's even a 30-day moneyback guarantee. You don't need any help from me to do that.

I did not state that files created and owned by nobody could not be interfered with by other users. I also did not state that world-writable files could not be overwritten. You haven't been listening to what I'm saying. Your assertions have been far broader.

User accounts are not world-writable (unless the user changes the permissions), nor are they writable by user nobody. So you won't be creating files in them unless you own the account. That's basic Unix permissions again.

Getting listings of other users' files is similarly meaningless. It's Web content, there to be published through the Web. If the content needs protected, it can be wrapped.

Kevin

ps Apology accepted.

sigma

04-01-2007, 02:21 PM

My point -- Matt I hope you stick around here and keep contributing. WHT is an "interesting" place, and having you around is valuable to the community. It's good to have differences of opinion and vibrant discussions.

I do enjoy the topics as well. I know Matt runs his servers a particular way and as I've already said, I respect that. But that's not a license to disrespect other ways of running servers, particularly by spreading misinformation.

Kevin

mheaton

04-01-2007, 02:56 PM

User accounts are not world-writable (unless the user changes the permissions), nor are they writable by user nobody. So you won't be creating files in them unless you own the account. That's basic Unix permissions again.

If a users scripts don't have write permissions in the persons home directory then scripting is basically useless. Either you have a massive security hole, or scripting on your
servers is totally inept and worthless because you can't do anything (writing disabled on your servers). Mod_php means all php runs as a single user. You either support writes or you don't? You are saying you dont'?!?!? Huh?? What you are saying is that a user couldn't write a php program that saves the number "1" in a flat file (textfile) in their directory. Wow thats powerful scripting :) This will be my last message on the topic so you get the last word if you like. We are going in circles. I can bring a horse to water but I can't make em drink or in this case even take a sip. Good luck :)

sigma

04-01-2007, 03:27 PM

Congratulations, you're finally starting to listen and understand. You apparently have a very limited view of scripting if you think every script has to write some local file on the server. Scripts are very useful for many other purposes besides that (and they can use /tmp for session storage). Most scripts do not need to write local files in order to be useful.

Of course, even if a user wanted to write local files as nobody in a writable directory, that doesn't mean their other files could be overwritten; you're taking an all-or-nothing view of the possibilities.

Kevin

layer0

04-01-2007, 03:39 PM

mheaton,

PM me and I will set you up an account on one of our servers. Then you let us know if you can "touch" your file. :agree:

layer0

04-01-2007, 03:49 PM

Here we go...I'll even test it myself.

Source code: http://www.accelerated.be/write.phps

http://www.accelerated.be/write.php

There you go, can't even see the file, period, due to open_basedir, and even when you remove open_basedir you cannot write to the file;

Warning: fopen(/home/geek/public_html/file.txt) [function.fopen]: failed to open stream: Permission denied in /home/admin/domains/<<>>/public_html/write.php on line 3
can't open file
That's the error you get, without open_basedir.

Our PHP setup:

PHP 4.4.x running as mod_php4, [open_basedir enabled]
Zend Optimizer, Suhosin, and eAccelerator.

No offense, but not only is running PHP as CGI significantly slower than mod_php, but you also cannot run eAccelerator or any other such optimizer (and cache). Therefore, there is no way, even with FastCGI, that your servers can come close to the level of performance in a properly tuned mod_php setup such as ours.

Best,

P.S. Can't wait to see your "public apology" :)

mheaton

04-01-2007, 10:06 PM

Jeeze, I hate being right all the time :) You CAN run Eaccelerator/Xcache or other php accelerators that save compiled opcode in memory with Fastcgi and CGI mode. Its hard to do and we did submit the patch back to the Fastcgi community so they could include it in the next release if they choose. I know you can do this because we have it running now on several of our servers. Again, it seems that everyone has a preconceived idea of what is possible. I do admit that this was VERY difficult to accomplish and took our best developer almost 2 weeks to make work. It does have the disadvantage of not being able to share memory in a normal mod_php/perl setup, but the speed is the same and the security is MUCH better. This is on several servers on Bluehost and in a few weeks will roll out to Hostmonster. We have taken Eaccelerator and Xcache a step further by writing our own dynamic cache to go along with it that will handle get/post/ip/cookies etc to cache output of a dynamic script. This doesn't work well for all scripts, but certain ones like wordpress, gallery, etc where the mainpage doesn't change all the much is orders of magnitude faster. My mattheaton.com site could handle more than 300x the traffic to it in our tests because instead of hitting php and mysql on every hit it simply displayed the cached static HTML page generated by the output. We will allow you the set the cache time from 30 seconds to 60 minutes. For sites that get slashdotted or tons of traffic from digg it won't cause our servers to be hit anywhere near as hard. The best part is because it is something we wrote ourselves it is tightly integrated and requires NO modification of any scripts to work. You will simply enable PHP Acceleration as the first step, and then choose to turn on Dynamic Caching (If you want it). We also track #hits per second and real time cpu usage so we can turn this on for accounts that are killing the system if it happens and then off when the server calms down without having to have personnel intervene for every instance.

What I am saying is that you shouldn't always take everything at face value. The information out there says you can't do this with CGI and Fastcgi. I never take "No" for an answer and so we just fixed it to work. The same goes for your disbelief that mod_php is insecure. Blah, I really am beating a dead horse now and you got me to post again :) You are good!

layer0

04-01-2007, 10:09 PM

sigma

04-01-2007, 11:21 PM

He hasn't had anything to say about the danger to a user's account when wrapped scripts get compromised, either. There seems to be a huge willful blind spot to his own errors and misconceptions, while he is simultaneously asserting "it seems that everyone has a preconceived idea of what is possible".

He is a fascinating character, to say the least.

Kevin

mheaton

04-01-2007, 11:55 PM

Yes, I don't disagree that wrapped scripts withing FastCGI have a potential for problem if FastCGI is compromised. Normal CGI doesn't have this issue as it run all the time as their own user. I just happen to believe that a single process that changes to an individual user all the time is 10x better than running EVERYONE as nobody and hoping the crappy open basedir jails the users from each other. That is like putting a matchstick in front of a semi and saying you can't get by me because I am blocking you.

What is your hosting company URL so I can test out your service?

Aussie Bob

04-01-2007, 11:59 PM

. . . What is your hosting company URL so I can test out your service?
Kevin runs Pair.com. Go easy on them, as they've only been in business since Moses played fullback for the arabs. :D

sigma

04-02-2007, 12:03 AM

I don't recall saying anything about FastCGI at all. I said that scripts running as the user present a greater problem when they are compromised remotely. Scripts running as nobody have fewer privileges; it only took me five posts or so to get you to see that, remember?

Kevin

mheaton

04-02-2007, 12:20 AM

What?? "Nobody" has fewer privileges on OUR server, but not yours. You made "nobody" have privileges the second you decidedto run mod_php as Nobody. Now it has ALL the privileges. Thats the whole point. Now nobody has execute rights in your users home directories. On our servers "nobody" is really nobody and can't do anything and has no rights. Also, not sure why you said "remotely" is an issue? Its neither more or less secure remotely when talking about scripts!? If port 80 is open and I have a cgi-bin I can do anything with a script that you can do locally with shell access. It doesn't matter with scripts. We aren't talking about exploits on open ports through remote atttacks?!?!

Scripts that run as their own user, if compromised, allow you to remove anything owned by that user. It will not and does not affect any other user. IE if PhpBB gets compromised for a single user on our server it doesn't affect any of our other users.

Scripts that run as nobody where individual files are owned by someone else such as user "user1" are worthless in my opinion. Either you have to chmod your files that are owned by "user1" to a writable permission in (Example path only) - /home/user1/filename or you have to create "nobody" owned files in /home/user1/file or in /tmp (Which is silly by the way because many scripts required long term storage in a users directory and forcing a user to use /tmp is bad form at least and will make your customers hate you at worst).

So you have 2 possibilities - 1) Files in a users home directory that are owned by BOTH the user AND nobody (Horrible HORRIBLE idea), OR you have scripts that simply can't write in their home directory and you tell them to use /tmp!?!? Pick your poison.

sigma

04-02-2007, 12:24 AM

False dichotomy. You're again ignoring other people's statements and creating your own versions of the topics at hand (e.g. that all scripts require writing to user directories). I'm not going to keep explaining file permissions and scripting to you.

Best wishes, sir! Especially with the 200GB plans, which as I recall, were the original content of this thread.

Kevin

mheaton

04-02-2007, 12:38 AM

I have edited my post above, you might want to look at it again.

Also, I never said "all" scripts require write access to a users home directory. I am saying many of our users DO use that, and it simply doesn't work to tell them they can't. Why would I want to do that. There are certainly many users that don't need that ability and they would never know the difference, but what about everyone else that does? We have tens of thousands of clients that use this everyday. If I use your argument that they don't need it or want it then I lose a huge revenue source. I looked at it in the beginning and said to myself would I sign up for this to do my own development on? If the answer was no then I fixed it so the answer would be yes. If you box your customers in they will box you out.

siforek

04-02-2007, 12:44 AM

On the topic of 200GB plans, I will say that mheaton is doing it better than anyone I know. Yes there are disadvantages, but it seems that the advantages are far more.

Overselling is not wrong if you do it right. Most successful business oversell even outside of hosting.

mheaton

04-02-2007, 12:46 AM

bjdea1

04-02-2007, 03:34 AM

I'm the original starter of this thread and here's my concern:

Its obviously getting rediculous with hosting plans going to 2000GB and being priced at something like $15/m

Ok so many here say - well who cares? - if these buisnesses want to do it - let em. Well my point is that I feel somethings going to collapse in this industry some day in the future. I kind of view it like the stock market, when it gets WAY overvalued after a while there's a real nasty CRASH. With so many hosting companies today pushing the envelope well beyond what's logical I kinda feel somethings going to bite back on all of us.

In effect this whole overselling thing is "misleading the public" and creating unrealistic expectations on all of us. Its forcing all of us (well a lot of us) to stretch our own plans a little more each few months to stay competitive. Without realising it we are all starting to oversell more and more and this is kinda creeping up on all of us.

Ask yourself the basic question - why is there quota and bandwidth limiting on servers? Isn't it to protect the server?!!! Plus isn't it also to protect the Hosting Company? Since some shared plans today have quotas and bandwidth limits greater than the actual servers physical capacities - do these hosts realise they are potentially giving a single shared user the power to bring down the entire server? It could take something as simple as a buggy script to generate the huge amounts of data (either by error or deliberate evil intent) and they could fill up the hard drive pretty quickly. I see new security problems arising and its a problem for all of us.

sigma

04-02-2007, 07:19 AM

There are certainly many users that don't need that ability and they would never know the difference, but what about everyone else that does? We have tens of thousands of clients that use this everyday. If I use your argument that they don't need it or want it then I lose a huge revenue source.

As I've also mentioned repeatedly, customers simply use cgiwrap (or suexec if you prefer) for those cases. This gives the customers more flexibility and better protection - default to "nobody" to reduce the privilege of the script, or let them wrap it when they need the benefits of running a script under their own account.

It's the exact opposite of "boxing customers in" - it gives them more options and capabilities than forcing everyone to do it just one way.

Kevin

cscertified

04-02-2007, 02:19 PM

bwb

04-02-2007, 02:32 PM

I must say that it is very interesting to see the owner of pair and the own of bluehost boxing out. Two completely different business models. I have never really looked at pair, but after taking a look at the plans it reminds me of how things where back in the good old days when service had value. A set up fee: takes time to set up a customers so you charge for it. Package cost that actually are realistic with the amount of space the customers get. In the past 5 years or so things have really moved away from the realistic to the unrealistic.

As the thread starter stated.. every month you have to adjust your services to keep up with the companies spending big bucks advertising packages that are just too much for the price. I have nothing against creative marketing, but people must be able to under stand that soo much for soo little, just does not make since. If all markets did this I would be able to go get a BMW for $5 a month.You are totally missing the point. Here is the point...

1. bandwidth/diskspace = Marketing

They DO NOT have anything to do with what you used to be actual physical limits. The real limits are cpu/mem usage and the steps taken to isolate those per user as bluehost has done. Users don't understand cpu/mem and a really small % actually use them so that is buried in the TOS/AUP while the marketing numbers are used to pull in clients.

A BMW and shared hosting have no correlation and that was a bad comparison .

cscertified

04-02-2007, 02:46 PM

You are totally missing the point. Here is the point....
No, actually I got the point completely...
They offer an amount of space and bandwidth that can not really be given to their customers. If all the blue host customers used the bandwidth that they are told they can use (through advertising) blue host would go broke!!!

The example of the BMW was a little extreme, but I think it got my point across. If you don't like. While I am sorry...

bwb

04-02-2007, 02:55 PM

No, actually I got the point completely...
They offer an amount of space and bandwidth that can not really be given to their customers. If all the blue host customers used the bandwidth that they are told they can use (through advertising) blue host would go broke!!!

The example of the BMW was a little extreme, but I think it got my point across. If you don't like. While I am sorry...
If any hosting companies customers used all the bandwidth and diskspace they would be in trouble. Overselling is how shared web hosting works. I can make up hypothetical statments too but that doesn't mean anything... how about if none of the customers used any bandwidth and diskspace, then everything would be ok :).

I don't understand what you are upset about.
1. This industry oversells because people don't use it. Its always been this way.
2. Marketing is done using a variety of techniques, with the drop in physical hardware prices bandwidth and diskspace has become part of that marketing.
3. As always the only real rule in shared hosting is keep the servers stable, if your site uses too much cpu/mem to do that with any hosting company you will be asked to leave or upgrade.

mrzippy

04-02-2007, 03:07 PM

If any hosting companies customers used all the bandwidth and diskspace they would be in trouble. Overselling is how shared web hosting works.

Sorry but that is 100% not true.

Perhaps it's how your company chooses to operate, but there are many of us (mostly not here at wht, which tends to attract new/cheap hosts) out there who still have the "good old" plans and prices from the old days.

Our market would obviously be much different then the one targeted by bluehost (and perhaps yourself)... but we do indeed offer shared hosting.

:)

bwb

04-02-2007, 03:09 PM

Sorry but that is 100% not true.

Perhaps it's how your company chooses to operate, but there are many of us (mostly not here at wht, which tends to attract new/cheap hosts) out there who still have the "good old" plans and prices from the old days.

Our market would obviously be much different then the one targeted by bluehost (and perhaps yourself)... but we do indeed offer shared hosting.

:)Good to hear but you are in a small small small minority out of the hosting companies, can you PM me URL and how many people you put on a server to check your math?

mrzippy

04-02-2007, 03:49 PM

I prefer not to conjecture about what is the "minority" and what is not.

It is my personal experience that the micro-universe here at WHT is just a small segment of the hosting industry. For example, the vast majority of hosts in my immediate local market (Vancouver, BC, Canada) sell their hosting in the $20 - $30 range for a basic package. I recently met with a group of my peers from the Portland, OR market who have similar pricing.

There are plenty of hosts who still operate this way. We hosts who compete in this "premium" market generally don't bother coming comparing against the company's here at webhostingtalk or publicly advertising against the cheapo hosts (ie: google, et al). It's a completely different market segment and requires different marketing tactics.

The hosting industry is huge, and includes far more then just what you see online, at the "review websites" or killing each other for google clicks.

:)

bwb

04-02-2007, 04:00 PM

Ok cool, can you PM me your site and tell me how many clients you put per server, I'm betting you are overselling and I'd like you to prove me wrong here :). I got a msg from someone else in your place, ill let them post if they want to be public. They report they are not overselling.

They put 75 to 100 clients per server:

Their lowest plan is 500MB and 10GB transfer for $9.95. It doubles and quadruples in specs as you go higher.

so 75 clients with that plan would be: 37,500MB and 750GB tansfer
so 100 clients would be 50,000MB diskspace and 1000GB transfer

And that is just their lowest plan. Would you consider that overselling?

ps, hopefully the math is right

lostmind

04-02-2007, 04:39 PM

50GB in drive space and 1,000GB in bandwidth? It'd be overselling on any server unable to provide that I suppose. However, I'd think that just about any decent server could handle those requirements with room to spare...

mrzippy

04-02-2007, 05:05 PM

Their lowest plan is 500MB and 10GB transfer for $9.95. It doubles and quadruples in specs as you go higher.

so 75 clients with that plan would be: 37,500MB and 750GB tansfer
so 100 clients would be 50,000MB diskspace and 1000GB transfer

And that is just their lowest plan. Would you consider that overselling?

I would not consider that overselling. But it depends on their servers and number of clients they claim to put a limit on.

For example, on one of our brands we have 400gb drives (in a raid array) with a 2000gb bw limit. If we used the plan spec you mentioned above (500mb/10gb) we could have 200 customers (using bw as the limiter). At $9.95 per customer that is $1990 revenue per server.

With such a plan, overselling is not needed, unless they wanted to squeeze out more profit... and what I am saying is that there are plenty of hosts who are not in this business just to squeeze out maximum $$ at the sacrifice of reliability, etc...

I'd prefer not to give out my premium brand URL, but suffice to say that our cheapest plan it $25/month (on special) and comes with 500mb disk and 7gb of bandwidth. We do not oversell on that brand. Our average profit per server is over $2k. That's profit, not revenue.

Overselling and cheapo prices are certainly one way to run a business. It is certainly much easier to get customers. But... it's not the only way to run a hosting business. It's just the easiest for all these kiddy hosts to get into, and that has lowered the "standard" for much of the industry, but certainly not all.

IMHO, it's too bad so many hosts lack the business acumen to sell their product/service effectively without resorting to "barely ethical" marketing tactics such as this thread title eludes to.

:)

bwb

04-02-2007, 05:12 PM

Ok how about this, if only 1 to 2% of your customers are using even 90% of the limits you place on those accounts, do you think those limits have any grounding in reality and why? Why arn't those just marketing?

What % of your clients actually use 50% of the limits on their accounts?

mrzippy

04-02-2007, 05:19 PM

I don't know what is our "per customer" utilization breakdown. However, I do know that for of all our servers under our premium brand we have an average of less then 10% actual utilization for disk space and cpu.

Even on our most "overloaded" server, we have actual utilization of less then 50% of the total physical disk and bandwidth available.

bwb

04-02-2007, 05:31 PM

bjdea1

04-02-2007, 06:02 PM

Overselling on these new extreme levels == security risk, downtime risk

If the quotas are greater than the physical capacity of the server then a SINGLE malicious user can now bring down an entire server by filling the hard drive with bogus data, by means of a simple script that writes bogus files.

JohnCrowley

04-02-2007, 08:29 PM

Ok so if your customers are only using 10% of the resources you are giving them arn't you just using diskspace/bandwidth as marketing too?Everything is marketing if you're a for profit business. That is not the issue. What some of us have a problem with is when the plans specs are basically promising each and every client more resources than most dedicated servers for $5/month. This is unrealistic, as the average website using a mixture of static and dynamic content could not use all of what they purchased without violating a TOS "hidden" limit.

We've been doing this 11+ years now, and I can honestly say we have never suspended / cancelled a client who was within the specs of their shared hosting account with us. (I'm not counting /dot events where the traffic is disproportionate for a small amount of time.) Sure, an out of control "home brewed" script might need to be adjusted or not used, but when the plan specs are in proportion to the number of clients you put on a server (For us, 100-150 clients using P4 or higher servers, 2+ GB RAM, SCSI RAID), you can run a pretty stable system and give any client at any time full use of what they purchased.

Your price point is then just a matter of how much profit you want/need to make in order to come through 100% of the time on all the promises (i.e. marketing) on your website to be a true leader in whatever niche you're occupying.

- John C.

bwb

04-02-2007, 08:47 PM

Everything is marketing if you're a for profit business. That is not the issue. What some of us have a problem with is when the plans specs are basically promising each and every client more resources than most dedicated servers for $5/month. This is unrealistic, as the average website using a mixture of static and dynamic content could not use all of what they purchased without violating a TOS "hidden" limit.

We've been doing this 11+ years now, and I can honestly say we have never suspended / cancelled a client who was within the specs of their shared hosting account with us. (I'm not counting /dot events where the traffic is disproportionate for a small amount of time.) Sure, an out of control "home brewed" script might need to be adjusted or not used, but when the plan specs are in proportion to the number of clients you put on a server (For us, 100-150 clients using P4 or higher servers, 2+ GB RAM, SCSI RAID), you can run a pretty stable system and give any client at any time full use of what they purchased.

Your price point is then just a matter of how much profit you want/need to make in order to come through 100% of the time on all the promises (i.e. marketing) on your website to be a true leader in whatever niche you're occupying.

- John C.Good point, I just think its odd that other companies get mad and think somehow this level over overselling hurts them when everyone's customers barely use any of what their customers sale. If you are offering packages that have half of what bluehost offers and yet your customers only use 10% of what you offer why not just increase those packages since those limits don't matter.

JohnCrowley

04-02-2007, 08:55 PM

Good point, I just think its odd that other companies get mad and think somehow this level over overselling hurts them when everyone's customers barely use any of what their customers sale. If you are offering packages that have half of what bluehost offers and yet your customers only use 10% of what you offer why not just increase those packages since those limits don't matter.You hit the nail on the head! By offering these higher limit packages, you start attracting a different breed of client, and some of them will want to use all of which you provide. With smaller limits, even if the average is 10%, there are still those that use 100% and those that use 1%. If the server can support this at the lower level, you make good on 100% of your claims.

Now you ramp it up so the package is 10 times larger. Now you will have a few clients all using ten times more to keep the 10% rule in effect. But your server is not comfortable handling these "power" users, who really are only using what they paid for. Now you start suspending their sites, upselling them to dedicated servers, or cancelling them due to repeated TOS abuses. Now they complain, tell others, and that untarnished reputation is now tarnished, and you're spending more time, money and energy trying to squeeze more out of that server, instead of providing the stellar support your old clients expected.

With proportionate limits, you attract the type of clients that will work for your model, and insure that these limits can be used (completely) by the average website without violating a "nebulous" limit buried in a TOS somewhere. Or, ramp up your limits, but don't forget to ramp up the prices, so you can place less clients on a server and still make good on those "promises" on your website.

- John C.

JohnCrowley

04-02-2007, 09:01 PM

Good point, I just think its odd that other companies get mad and think somehow this level over overselling hurts them...There is an opposite effect to this statement as well. It is true some hosts get upset at this level of overselling and low prices. But many of the larger "budget overselling" hosts are also getting upset (hint hint...Matt) because they may have the greatest servers in the world with all kinds of optimizations no one else has, but the average consumer will not and does not know it, as the one man host that has a nice website offers the same plan features and price, or even worse, offers more for less! And only has one unpatched server he or she rents month to month! :D

Gotta love the internet and its ability to level the playing field sometimes.

- John C.

bwb

04-02-2007, 09:06 PM

You hit the nail on the head! By offering these higher limit packages, you start attracting a different breed of client, and some of them will want to use all of which you provide. With smaller limits, even if the average is 10%, there are still those that use 100% and those that use 1%. If the server can support this at the lower level, you make good on 100% of your claims.

Now you ramp it up so the package is 10 times larger. Now you will have a few clients all using ten times more to keep the 10% rule in effect. But your server is not comfortable handling these "power" users, who really are only using what they paid for. Now you start suspending their sites, upselling them to dedicated servers, or cancelling them due to repeated TOS abuses. Now they complain, tell others, and that untarnished reputation is now tarnished, and you're spending more time, money and energy trying to squeeze more out of that server, instead of providing the stellar support your old clients expected.

With proportionate limits, you attract the type of clients that will work for your model, and insure that these limits can be used (completely) by the average website without violating a "nebulous" limit buried in a TOS somewhere. Or, ramp up your limits, but don't forget to ramp up the prices, so you can place less clients on a server and still make good on those "promises" on your website.

- John C.Interesting theory, I don't agree that it attracts a new type of client as I think the pricing and the impression of quality is what does that, but I see your point. Of course by attracting the "masses" they can grow much quicker while a more conservative company grows slowly so its a trade off.

But you have kinda proved my point, you are using bandwidth and diskspace for marketing and not as real limits, you are using them to market to more conservative educated customers. Correct?

Aussie Bob

04-02-2007, 09:42 PM

Interesting theory, I don't agree that it attracts a new type of client . . .
I'd agree with John, that offerring mega plan resource allocations will have the effect of attracting a certian type of client. Word gets around, and especially these days with video becoming more and more used on sites, mega high bandwidth offers will attract a lot of attention. If you put the bait out there, offerring those mega style plans, don't be surprised if you catch big fish, that might indeed use your promised resource allocations.

I'd like to see how many of those plans Matt places per server. Let's face it, promising 300 (just a guess based on the pricing) clients that they can each use 200GB disk space and 2,000GB data transfer/mth, on the one server, no matter how optimised and tweaked, is a recipe for a volatile server.

hcn

04-02-2007, 10:04 PM

scribby

04-02-2007, 10:07 PM

I've tried out some of these massive plans and you never get to use what they state anyways, you go over the CPU allowed limit for your account and your either suspended or terminated. Means basically you never get what you paid for because how can you use 2TB of bandwidth while keeping to say 2% CPU usage?

Its like saying here have 50TB's of bandwidth, but don't go over 2% CPU usage or we will boot you off the server! How can you possibly use that 50TB's of bandwidth without going over 2% CPU usage?

JohnCrowley

04-02-2007, 10:20 PM

Interesting theory, I don't agree that it attracts a new type of client as I think the pricing and the impression of quality is what does that, but I see your point. Of course by attracting the "masses" they can grow much quicker while a more conservative company grows slowly so its a trade off.

But you have kinda proved my point, you are using bandwidth and diskspace for marketing and not as real limits, you are using them to market to more conservative educated customers. Correct?Not really correct. Yes, our limits are limits, and we have never stopped a client from using what they have purchased. Any client can use what they purchased because the limits are in proportion to the server and number of accounts we put on them. I'm not saying we can support it if *every* client on the server used all their resources at the same time, but that's not realistically going to happen (the whole what if everyone flushed their toilet at the same time...). We market to newbies and educated clients alike, but set our plans realistically based on knowing we can provide 100% of what we promise to any client, at any time.

Pricing is important for attracting the right client though, I'll agree with you on that point. :)

Fast growth for the sake of growth is not always the sign of a stable company. It's just a sign of a fast growing company. ;)

- John C.

JohnCrowley

04-02-2007, 10:22 PM

...I'd like to see how many of those plans Matt places per server. Let's face it, promising 300 (just a guess based on the pricing) clients that they can each use 200GB disk space and 2,000GB data transfer/mth, on the one server, no matter how optimised and tweaked, is a recipe for a volatile server.I'm estimating about 750 accounts per server based on the claim of 300,000 clients and 400(ish) servers. :D

- John C.

sigma

04-02-2007, 11:18 PM

This may be the first time in recorded history that a thread has actually gone back on-topic at my request ;)

Kevin

mheaton

04-02-2007, 11:38 PM

There is an opposite effect to this statement as well. It is true some hosts get upset at this level of overselling and low prices. But many of the larger "budget overselling" hosts are also getting upset (hint hint...Matt) because they may have the greatest servers in the world with all kinds of optimizations no one else has, but the average consumer will not and does not know it, as the one man host that has a nice website offers the same plan features and price, or even worse, offers more for less! And only has one unpatched server he or she rents month to month! :D

Gotta love the internet and its ability to level the playing field sometimes.

- John C.

The average consumer doesn't know it because we are good. They want things to work. We don't even care to let our customers know all the enhancements we put into our servers. We simply want it to work for them. They only care when things DON'T work.

Why does everyone always say over and over that overselling hosts can't satisfy their customers needs. Thats total rubbish. SOME hosts do a terrible job managing servers and destroy their reputations in the process, and others do great (Like Bluehost :) ). These generalizations are crap :)

sigma

04-02-2007, 11:45 PM

mheaton

04-03-2007, 12:08 AM

I'm estimating about 750 accounts per server based on the claim of 300,000 clients and 400(ish) servers. :D

- John C.

We have no fixed amount of accounts. That makes NO SENSE at all. If a server can handle lots of clients then we have put up to 700 clients on them. We have other servers with literally less than 25 accounts. Most are in the 400 range. Remember we dynamically track usage by cpu/memory and disk space and automatically move people around all the time to make things run smoothly. Sometimes we lose hordes of money on clients (22 clients on a single server that costs us around $4500) that use a lot of resources and others we can put many clients on and have cpu/memory loads that aren't even touched. Thats how it goes if you are doing shared hosting.

Please keep in mind that our hardware for our servers is MUCH FASTER than the average hosting companies. We have 8 drives in every 2U box, almost all our servers are quad processor, and the new ones we are putting in have 8 cores (Xeon 51xx) cores. At least 4 gigs of RAM and often we have 8 or 12 gigs (Again depending on need and usage). We separate file system parititons on different physical storage (So MySQL read/writes/seeks don't affect IO for home etc), and DO have significant performance enhancements that little hosts simply don't have (You can let me have it for saying that in a reply but it IS true :) )

cowabunga

04-03-2007, 12:12 AM

hehe, you bet. Just waiting for cowabunga so slide in and we'll see some real action then. :dgrin:

Bob, the tiny 12 server host with a wife and 6 kids. :angel:
Sorry I missed the fireworks Bob : ) … I have a lot of respect for both John and Matt-
And certainly for Pair and kevin; though John and Matt are about as far apart as Hyundai and Aston Martin…Ideally drive a DB9 -vipers are rather crude : ) and own Hyundai stock... John has in my opinion a best of breed handle on high RPU and net value customer acquisition, retention and customer management- which as he stated, drive his competitive advantage and USP. Matt has built BH into a strong contender in the shared space and most likely will make it to the next level- As far as all the tit for tat on the server management side, at the end of the day while it’s operationally beneficial to have granular service architecture management down to a tee – I couldn’t care less as long as security is always foremost, there are minimal failure points, that nothing is dependant upon a single commercial application layer and that everything scales to support client acquisition, management and service –equally and proactively. Scaling to run a thousand clustered servers, a multitude of netapp arrays and the rest of the boxes in the stack tranparently is academic as a far as I’m concerned, all I care about is finding and keeping the right customers and developing the kind of sector awareness and customer base we saw the possibility of six or seven years ago- before reselling, ‘control panels” and the tedious, banal discussions of “overselling” et. al along with all the other crap that lowered the bar and carried the industry to where it is today.

As far as the original topic goes… When you mange and calibrate service architecture and provisioning for greater overall operational efficiency and customer retention it ain’t overselling- It’s the way the business was run before the competitive clutter created by the aforementioned crap and desperation. However when you go to market in the shared space with unused yet provisioned allocations because you’ve got no brand, a double digit churn rate and an average CAR of $100+ and are unable to otherwise market your service- it’s overselling, and it means you don’t have staying power in this business regardless of your company’ size. Any large or medium sized host can offer plans which no one on WHT can touch yet not be overselling, it’s called downward pricing pressure- in this business you either exert it or feel it. Because it isn’t understood or perceived as fair by small WHT hosts doesn’t make it wrong. The market competitive dynamic is escalating as it matures- it’s just the way it is and why many small hosts will be out of business and many larger hosts will sell out over the next few years trying to compete.

I care a lot about the sector customer base, which isn’t half as big as most people think and certainly agree that one of the big problems with the bandwidth wars, is growing consumer misconception- that of high provisioning being equated with dedicated performance and reliability- Unfortunately, there’s going to be a perception precipitate with any mass market advertising-driven positioning- without the whole data set people just make incorrect assumptions – hell, they used to think that tang was as good for you as real orange juice because astronauts drank it- orange growers weren’t too pleased. Naturally the provisioning trend is hurting niche business hosting and will peak on the provider side vis a vis customer growth and service architecture scalability as there isn’t a moore’s law in hosting, it has to end somewhere- John and Matt will be more than fine; as the pendulum swings the opposite direction SMB’s will realize through experience that high provisioned shared hosting ain’t the ticket for a business of any size and a market niche will develop from the demand side rather than the supply side- As the market stratifies there will be a number of larger hosts that figure out how to provide budget hosting which overcomes escalating customer acquisition costs v costs to serve and still turns a decent operating margin. It’ll be while but things will normalize.. they always do.

mheaton

04-03-2007, 12:22 AM

Not to veer offtopic again, but I'm very disappointed in you, Matt. You said you wouldn't be trying to break into any user accounts, but apparently you (and your friend) promptly attempted just that. Those actions tripped half a dozen alarms and the account was locked for policy violations.

Kevin

We were trying to make the files in your users directories like you said. It worked BTW, we used mod_php to get into accounts and create files in any users account. I have all the details if you want so you can patch the server, but I certainly didn't want you upset. I thought the whole point was to prove our point that is was insecure. I am PMing you right now with my cell number if you want to chat about it.

Z5-Karl

04-03-2007, 12:25 AM

The average consumer doesn't know it because we are good. They want things to work. We don't even care to let our customers know all the enhancements we put into our servers. We simply want it to work for them. They only care when things DON'T work.

Why does everyone always say over and over that overselling hosts can't satisfy their customers needs. Thats total rubbish. SOME hosts do a terrible job managing servers and destroy their reputations in the process, and others do great (Like Bluehost :) ). These generalizations are crap :)

Overselling, Overselling, Overselling.

Well.. The truth is that overselling is now part of the web hosting industry. You can fight against it all you want but its not going to go away. Lets take a look at some of the biggest web hosts today. Shoot me dead if you ever see a plan on Go Daddy or 1&1 that has 150MB and 10GB of bandwidth. Hosts that try and market plans that are not overselling with their plans are NOT SELLING! There are not many successful hosts that don't oversell. The people who are looking for hosts that don't oversell are those who have a good understanding of the web hosting industry and know just what the heck is going on. This is quite a small target you are trying to advertise for. Web Hosts that are overselling are selling. Its quite simple.

Most of the long term web hosting clients are those who know very little about web hosting and don't have much care for the dynamics involved, all they want is for their website to be on the internet! There is no problem with this audience and in fact it makes up much of the web hosting industry. They want to save money and are looking for the most for a good price. Overselling plans are both of these. Now when I first got involved with web hosting I was looking for a plan that was affordable and gave me some space to grow, should I need it. I quickly learned that I was only using about 8% of my plans limits. This was years ago and overselling has a new meaning now. Chances are If they didn't choose a good provider in the first place then chances are that within a few months they will get fed up with their site being slow and or down and move to another host. Therefore gaining more experience about the web hosting industry. Eventually you turn into the many who try and run their own web hosting company. The average life of a web host is under two years.

sigma

04-03-2007, 12:29 AM

We were trying to make the files in your users directories like you said. It worked BTW, we used mod_php to get into accounts and create files in any users account. I have all the details if you want so you can patch the server, but I certainly didn't want you upset. I thought the whole point was to prove our point that is was insecure. I am PMing you right now with my cell number if you want to chat about it.

No, it did not work.

You wrote to a world-writable directory which a user had specifically chmod'ed to 777, no doubt based on advice he/she read in a blog somewhere. If you had been actually reading this thread, you would have seen that I already mentioned that possibility. It's the exact same possibility on any other server - users can always shoot themselves in the foot. And what you did had no effect on other users, either, of course.

But guess what! You couldn't write to normal user directories. Just like basic UNIX permissions dictate. Shocking, I know.

And guess what! You would rather blindly claim you were right than acknowledge reality that contradicts you. Shocking, I know.

When you decided to try to backdoor their account, we got a little peeved. That's low-class and shameful. Of course, I won't be holding my breath for either your apology or your acknowledgment that you were writing into a 777 directory.

Kevin

sigma

04-03-2007, 12:44 AM

Mr. Heaton has apologized to me privately and I've accepted. He and I will surely continue to disagree on certain issues, but hopefully we're leaving it at that and not escalating further.

We would both probably say, "when you argue with a fool, from a distance it's hard to tell who is who".

Kevin

Aussie Bob

04-03-2007, 01:14 AM

Sorry I missed the fireworks Bob : ) … I have a lot of respect for both John and Matt-
And certainly for Pair and kevin; though John and Matt are about as far apart as Hyundai and Aston Martin…Ideally drive a DB9 -vipers are rather crude : ) and own Hyundai stock... John has in my opinion a best of breed handle on high RPU and net value customer acquisition, retention and customer management- which as he stated, drive his competitive advantage and USP. Matt has built BH into a strong contender in the shared space and most likely will make it to the next level- As far as all the tit for tat on the server management side, at the end of the day while it’s operationally beneficial to have granular service architecture management down to a tee – I couldn’t care less as long as security is always foremost, there are minimal failure points, that nothing is dependant upon a single commercial application layer and that everything scales to support client acquisition, management and service –equally and proactively. Scaling to run a thousand clustered servers, a multitude of netapp arrays and the rest of the boxes in the stack tranparently is academic as a far as I’m concerned, all I care about is finding and keeping the right customers and developing the kind of sector awareness and customer base we saw the possibility of six or seven years ago- before reselling, ‘control panels” and the tedious, banal discussions of “overselling” et. al along with all the other crap that lowered the bar and carried the industry to where it is today.

As far as the original topic goes… When you mange and calibrate service architecture and provisioning for greater overall operational efficiency and customer retention it ain’t overselling- It’s the way the business was run before the competitive clutter created by the aforementioned crap and desperation. However when you go to market in the shared space with unused yet provisioned allocations because you’ve got no brand, a double digit churn rate and an average CAR of $100+ and are unable to otherwise market your service- it’s overselling, and it means you don’t have staying power in this business regardless of your company’ size. Any large or medium sized host can offer plans which no one on WHT can touch yet not be overselling, it’s called downward pricing pressure- in this business you either exert it or feel it. Because it isn’t understood or perceived as fair by small WHT hosts doesn’t make it wrong. The market competitive dynamic is escalating as it matures- it’s just the way it is and why many small hosts will be out of business and many larger hosts will sell out over the next few years trying to compete.

I care a lot about the sector customer base, which isn’t half as big as most people think and certainly agree that one of the big problems with the bandwidth wars, is growing consumer misconception- that of high provisioning being equated with dedicated performance and reliability- Unfortunately, there’s going to be a perception precipitate with any mass market advertising-driven positioning- without the whole data set people just make incorrect assumptions – hell, they used to think that tang was as good for you as real orange juice because astronauts drank it- orange growers weren’t too pleased. Naturally the provisioning trend is hurting niche business hosting and will peak on the provider side vis a vis customer growth and service architecture scalability as there isn’t a moore’s law in hosting, it has to end somewhere- John and Matt will be more than fine; as the pendulum swings the opposite direction SMB’s will realize through experience that high provisioned shared hosting ain’t the ticket for a business of any size and a market niche will develop from the demand side rather than the supply side- As the market stratifies there will be a number of larger hosts that figure out how to provide budget hosting which overcomes escalating customer acquisition costs v costs to serve and still turns a decent operating margin. It’ll be while but things will normalize.. they always do.
Now if someone can translate that. I don't speak Nimbari. :D

mheaton

04-03-2007, 01:31 AM

No, it did not work.

You wrote to a world-writable directory which a user had specifically chmod'ed to 777, no doubt based on advice he/she read in a blog somewhere. If you had been actually reading this thread, you would have seen that I already mentioned that possibility. It's the exact same possibility on any other server - users can always shoot themselves in the foot. And what you did had no effect on other users, either, of course.

But guess what! You couldn't write to normal user directories. Just like basic UNIX permissions dictate. Shocking, I know.

And guess what! You would rather blindly claim you were right than acknowledge reality that contradicts you. Shocking, I know.

When you decided to try to backdoor their account, we got a little peeved. That's low-class and shameful. Of course, I won't be holding my breath for either your apology or your acknowledgment that you were writing into a 777 directory.

Kevin

Kevin has been very gracious and has accepted my apology for one of my guys doing bad things in one of his accounts. He didn't have to do that but he was a class act and let it go. I think, however, it is VERY important for everyone to understand the significant security risks involved with mod_php and cgiwrap. We were able to not only write to 777 files but using mod_php and cgiwrap we could obtain write access as the user (not "nobody") and delete or modify EVERY users files on the system as the customer's user on the server. It wasn't just a single account.

I certainly won't post the code or the exact concept for this here and will provide the source code and anything else Kevin would like first thing in the morning. If Kevin is amiable to releasing it at a later date I would like it released later so that so others can test their servers against this type of attack and protect users data. I will leave that up to Kevin to decide when and if he wants to share that info.

Thanks,

sigma

04-03-2007, 07:25 AM

Kevin has been very gracious and has accepted my apology for one of my guys doing bad things in one of his accounts. He didn't have to do that but he was a class act and let it go. I think, however, it is VERY important for everyone to understand the significant security risks involved with mod_php and cgiwrap. We were able to not only write to 777 files but using mod_php and cgiwrap we could obtain write access as the user (not "nobody") and delete or modify EVERY users files on the system as the customer's user on the server. It wasn't just a single account.

False.

I look forward to the "code" you're sending me today.

Kevin

tash pop

04-04-2007, 04:35 AM

allanon

04-04-2007, 08:07 AM

True story:
When I picked my first shared hosting plan a few years ago, I had a choice:

30GB a month transfer
or
200GB a month

I chose 200GB and totally skipped all those stingy hosts with their 30GB plans the minute I saw them :)

mrzippy

04-04-2007, 08:14 AM

Do you really believe that the selling point is 200GB or so allowances??

In other words, I personally don't believe this is 'secret ingredient' that tips the scale in favour of client choosing the hosts with large allowances.. what do you all think??

I don't believe it is only the 200gb allowance that the customer considers.

It is a combination of large disk allowance, tons of bw, and the cheap price. These are the three things most customers can easily "compare" between different hosts... most customers believe "everything else" between hosts is equal. After all, they all advertise 24x7 service, high reliablity, tons of free scripts, blah blah blah...

...and so the average customer is easily suckered into thinking [insert budget host here] is better if they offer more disk/bw for lower price.

It's nothing more then lack of consumer education. The moment a customer runs afoul of the cheap-host's TOS... they will realize there is more to hosting their website then just diskspace, bandwidth and price.

We just had two bluehost refugees sign up with us yesterday. Both complained about the same thing. One had their site suspended for "excess cpu utilization", and the other person said the tech people told him his various database sql errors are caused by "high cpu load". They both signed up with us for accounts paying $34.95/month for 2gb disk and 25gb bw.

This is why I think it's great to have lots of these big cheapo monstor hosts around. They are a free sales tool for those of us in the premium hosting market. :)

I don't want to "fight back" against them. I want them to grow bigger.

mheaton

04-04-2007, 10:25 AM

Do you really believe that the selling point is 200GB or so allowances??
What percentage of clients list '200GB allowance' as the PRIMARY reason they chose a particular host? In my oppinion it's not too big %% but I'd like to find out.

In other words, I personally don't believe this is 'secret ingredient' that tips the scale in favour of client choosing the hosts with large allowances.. what do you all think??

You are missing the point. The increases aren't just for the customer, they are way to get in good with the affiliates. THAT is who matters initially. You must get them on board or the signups will come 10-20 a day. That isn't something we are interested in. We want 500 every day and those will never happen these days with a 20 gig plan.

sigma

04-04-2007, 11:01 AM

What if the profit margin is higher on the 10-20 signups than the 500? And what if the service is easier to operate, with good results for the customers, at the same time? There are other business models than the must-get-signups-at-any-cost approach.

Kevin

mheaton

04-04-2007, 11:22 AM

I don't disagree that there are different profit models, and in the end it what you want to get out of it. Everyone knows me for Bluehost and Hostmosnter, but I started and ran 50megs.com, and 0catch.com (Free hosting with paid upgrades) for a long time before I ever decided on the name Bluehost. Those two companies had a totally different approach than Bluehost and they were successful too.

What Kevin does at Pair is a valid business model as well. What I want though is to have good quality hosting at the lowest price level we can. We still make about 20% on all our hosting even after the low cost and millions every year in expenses, but when it comes time to renew hundreds of thousands of accounts each year I am VERY glad that I just took the fast track to signups. In my opinion the money to be made with this approach far outweighs most other options simply because of the enormous amount of customers that you have renewing. HOWEVER, you do have significantly more headaches because of grow and you have to be very disciplined to keep support at great levels while the growth is happening.

tash pop

04-04-2007, 06:30 PM

they are way to get in good with the affiliates. THAT is who matters initially. You must get them on board.
Good conversion rates + per sale ratio is what will bring affiliates on board (you said it yourself). Now. are you saying that you think, the single MOST contributing factor to your good conversion rates amongst customers is large storage/bw allowances? In other words do you believe (or have evidence) that the secret behind your good conversion rates is huge allowances or is there another reason why people choose you?

This is what I think the secret is (off course only you know for sure)
The control panel demo that is very visible on your site as opposed to other hosts. In the demo you have 1000000s of feature that makes people believe they're getting better VALUE than elsewhere (and not the allowances)... I dont know but would like to find out just because I just can't swallow the theory that the secret is the high allowances

tash pop

04-04-2007, 06:32 PM

P.S. what is the industry average for conversion rates? Anyone care to share??
(off course I'll take away at least 20% off your final answer hehe)

bwb

04-04-2007, 06:48 PM

P.S. what is the industry average for conversion rates? Anyone care to share??
(off course I'll take away at least 20% off your final answer hehe)

There is no real answer since there is no standard really. Web hosting is too fractured to get a good estimate and depends on where the traffic is coming from.

mheaton

04-04-2007, 08:15 PM

Good conversion rates + per sale ratio is what will bring affiliates on board (you said it yourself). Now. are you saying that you think, the single MOST contributing factor to your good conversion rates amongst customers is large storage/bw allowances? In other words do you believe (or have evidence) that the secret behind your good conversion rates is huge allowances or is there another reason why people choose you?

This is what I think the secret is (off course only you know for sure)
The control panel demo that is very visible on your site as opposed to other hosts. In the demo you have 1000000s of feature that makes people believe they're getting better VALUE than elsewhere (and not the allowances)... I dont know but would like to find out just because I just can't swallow the theory that the secret is the high allowances

Are you ready?? Here is the secret :) We do the large quantities of disk and bandwidth because the small hosts won't (good - first segment of competition eliminated). Next we pay high affiliate amounts and work our tail off to convert every click into a sale (good - now we have eliminated our affiliate competition because we pay high AND convert well so our affiliates HAVE to promote us or they leave money on the table by promoting someone else in our place). And the third is BY FAR the most important and difficult to do. We spend spend spend on our support dept so that customers are dumbfounded by how well they are serviced. This is crucial, not just because the customers like it, but because we rely on and depend on our current customers to refer people that we DON'T have to pay a huge affiliate bounty for. On Bluehost now 45-50% of our signups are word of mouth or referrals that we didn't pay a cent for. On Hostmonster that number is almost 40% (Keep in mind that Hostmonster is only 1 year old and hosts more than 90,000 domains now). Last month (March 2007) we had about 6,000 paying customers (Not domains) sign up that were word or mouth/recommendation sales. That doesn't even include our affiliate program that had huge sales last month. When you hear $100-$150 a sale for affiliate marketing everyone thinks it is impossible to make money. It works, but ONLY if your customers love you so much that they tell all their friends. Why do I share this? I share this because even though I say exactly how we are successful others won't follow because either they can't for financial reasons or they just don't get how support is a money maker instead of money loser because they can't find the column for it in their spreadsheet. It takes time to establish a brand. The above solution takes time to make work, but if you stick with it others will scratch their head wondering how you did it. Everyone can do this! You can do this! Just commit to a service level that wouldn't just satisfy the customer but makes them want to tell all their friends why they are stupid for not hosting with you. THATS when you've made it. Hope this help...

Thanks,

JohnCrowley

04-04-2007, 08:18 PM

...What I want though is to have good quality hosting at the lowest price level we can. We still make about 20% on all our hosting even after the low cost and millions every year in expenses, but when it comes time to renew hundreds of thousands of accounts each year I am VERY glad that I just took the fast track to signups. In my opinion the money to be made with this approach far outweighs most other options simply because of the enormous amount of customers that you have renewing. HOWEVER, you do have significantly more headaches because of grow and you have to be very disciplined to keep support at great levels while the growth is happening.Let's do a little fuzzy math here for fun (Why do I like the word fuzzy so much?).

Your website states you have 260,000 domains. Your plans come with up to 6 domains, so let's say for easy math you have 100,000 paying customers. Each customer pays $7/month, so your monthly income is $700,000/month.

You stated in this thread your monthly hardware costs are $150,000/month, so we're down to $550,000. Let's say phone, office, general office expenses, and misc. knock this down another $50,000 to $500,000. You also stated in this thread that your advertising/marketing costs were 7-8 times this $150,000 amount (you were vague on whether employee costs were included. Your blog stated you have 100 employees, so we'll assume payroll expenses of $300,000 per month). So, that is around another 1 million per month in expenses, but you only have $500,000 in recurring revenue.

Ah, but you have a strong affiliate program and a large signup rate. $65 of every $84 goes to paying the affiliates for new signups through this avenue. The leftovers must be used to fund the remaining expenses.

So, as long as new signups stay strong, and your 80-85% retention rate stays constant, you can use new signups to fuel current expenses. But what happens when new signups slide down? It happens to every business at one time or another... Now things get a little dicey I presume.

I guess the numbers do not make sense to me about how you are profiting 20% given what I've gleaned from this thread, your website, and your blog (all in about 5 minutes, so I may be missing a few things). Your model does work, but it seems much less stable than a traditional model.

- John C.

Aussie Bob

04-04-2007, 08:18 PM

It is a combination of large disk allowance, tons of bw, and the cheap price. These are the three things most customers can easily "compare" between different hosts... most customers believe "everything else" between hosts is equal. After all, they all advertise 24x7 service, high reliablity, tons of free scripts, blah blah blah...
Aint that the truth. heh. :)

Aussie Bob

04-04-2007, 08:26 PM

. . . Your website states you have 260,000 domains. Your plans come with up to 6 domains, so let's say for easy math you have 100,000 paying customers. Each customer pays $7/month, so your monthly income is $700,000/month.
John, you're inaccurate there. The $6.95/mth amount only kicks in when their client pays 24mths in advance. Their lowest is 3mth payment cycle for $9.95/mth + $30 setup fee. It's a common sales tactic to promote the 24mth prepaid plan ($6.95/mth) on the main page when in reality there is no $6.95/mth plan available to purchase. I've always found that a tad misleading, but that's how it goes in the cut throat world of marketing.

JohnCrowley

04-04-2007, 08:29 PM

John, you're inaccurate there. The $6.95/mth amount only kicks in when their client pays 24mths in advance. Their lowest is 3mth payment cycle for $9.95/mth + $30 setup fee. It's a common sales tactic to promote the 24mth prepaid plan ($6.95/mth) on the main page when in reality there is no $6.95/mth plan available to purchase. I've always found that a tad misleading, but that's how it goes in the cut throat world of marketing.ok, see what you miss in 5 minutes of reading? ;)

Let's assume $8.50/month average then, it still falls short of being self sustaining without current signups to keep things afloat according to my very rough math. And then a 20% profit on top of that just doesn't seem to jive... But I love being proved wrong! :D

- John C.

mheaton

04-04-2007, 09:00 PM

Let's do a little fuzzy math here for fun (Why do I like the word fuzzy so much?).

Your website states you have 260,000 domains. Your plans come with up to 6 domains, so let's say for easy math you have 100,000 paying customers. Each customer pays $7/month, so your monthly income is $700,000/month.

You stated in this thread your monthly hardware costs are $150,000/month, so we're down to $550,000. Let's say phone, office, general office expenses, and misc. knock this down another $50,000 to $500,000. You also stated in this thread that your advertising/marketing costs were 7-8 times this $150,000 amount (you were vague on whether employee costs were included. Your blog stated you have 100 employees, so we'll assume payroll expenses of $300,000 per month). So, that is around another 1 million per month in expenses, but you only have $500,000 in recurring revenue.

Ah, but you have a strong affiliate program and a large signup rate. $65 of every $84 goes to paying the affiliates for new signups through this avenue. The leftovers must be used to fund the remaining expenses.

So, as long as new signups stay strong, and your 80-85% retention rate stays constant, you can use new signups to fuel current expenses. But what happens when new signups slide down? It happens to every business at one time or another... Now things get a little dicey I presume.

I guess the numbers do not make sense to me about how you are profiting 20% given what I've gleaned from this thread, your website, and your blog (all in about 5 minutes, so I may be missing a few things). Your model does work, but it seems much less stable than a traditional model.

- John C.

Yes, your math is very fuzzy. First, we have Bluehost and Hostmonster and host more than 350,000 domains between them. Your 100,000 subscribers number is VERY low as well. Second, we do a LOT more revenue than what you calculate. Hosting ARPU is also more than just hosting fees afterall. We have fairly significant paid advertisers, up sell services, etc. In short, we do make a lot of money (I know because I have to pay the rest of my federal taxes very soon and pay my first 3 months of 2007 federal taxes in 11 days :) I kind of like this second guessing of Bluehost and Hostmonster. If people think we don't make money then they won't copy us and we will continue to dominate the shared hosting market. Fine by me :)

AH-Tina

04-04-2007, 09:09 PM

Yes, your math is very fuzzy. First, we have Bluehost and Hostmonster and host more than 350,000 domains between them. Your 100,000 subscribers number is VERY low as well. Second, we do a LOT more revenue than what you calculate. Hosting ARPU is also more than just hosting fees afterall. We have fairly significant paid advertisers, up sell services, etc. In short, we do make a lot of money (I know because I have to pay the rest of my federal taxes very soon and pay my first 3 months of 2007 federal taxes in 11 days :) I kind of like this second guessing of Bluehost and Hostmonster. If people think we don't make money then they won't copy us and we will continue to dominate the shared hosting market. Fine by me :)

Why are you trying so hard to convince us? Me thinks thou...ah, nevermind. You keep on spinning. ;)

--Tina

DavidL

04-04-2007, 09:16 PM

Why are you trying so hard to convince us? Me thinks thou...ah, nevermind. You keep on spinning. ;)

--Tina
He has every right to. I would do the same to prove my business ethics are true. :cool:

mrzippy

04-04-2007, 09:16 PM

... and we will continue to dominate the shared hosting market. Fine by me :)

Fine by me, too. :)

The bigger you get... the more customers you'll send to us. After all, that "unhappy" % of customers who break your TOS or otherwise piss you off and get suspended have to go somewhere...

We spend a lot of time trying to "educate" the general mass of hosting customers about why "cheapo" hosting might not be best for them, so I'm quite pleased you can help us with that.

:D

tash pop

04-04-2007, 09:16 PM

Why are you trying so hard to convince us? ;)

Why are you all trying so hard to beat his business model down instead of LEARNING something from it ! Even if they don't end up with as much per customer profit as other models he still makes more money in TOTAL than all of you combined! Isn't that what counts?!?!?

mrzippy

04-04-2007, 09:20 PM

... he still makes more money in TOTAL than all of you combined! Isn't that what counts?!?!?

No, it's not. Some of us are in this business because we just want to make a decent living, without basically lying (or at least willfully distracting from the truth) to our customers to get them to become our customers.

AH-Tina

04-04-2007, 09:25 PM

Why are you all trying so hard to beat his business model down instead of LEARNING something from it ! Even if they don't end up with as much per customer profit as other models he still makes more money in TOTAL than all of you combined! Isn't that what counts?!?!?

We know this how? Because he says so?

Let me tell you a story about my company. We have customers who love us so much they pay us triple what we invoice them, we have had dozens of clients name their kids after us, we have about 4000 signups per day and the only customer we've ever lost is that one guy who got run over by a bus. All of our employees actually pay US to work here...and our servers are gold plated and have 110% uptime. How do we do it you ask? Because we are superior to ALL of you mere amateur hosts!

Okay, maybe I exaggerated a bit. But you'll never know by how much, will you? ;)

--Tina

bwb

04-04-2007, 09:34 PM

Interesting, can you share what kind of upselling you do? Purely on hosting or on extra added items like spam filtering per mail box or stuff like that? Do you send out marketing emails to your user base with those type of offers or just in the control panel or thank you page?

I'm suprised as you are one of the first hosting companies I've heard doing this and I've been railing about this on my blog. Hosting companies loose so much money by not doing this, huge client base that is so expensive to get and then they let them sit there and quit or loose interest.

mheaton

04-04-2007, 09:43 PM

JohnCrowley

04-04-2007, 09:46 PM

Why are you all trying so hard to beat his business model down instead of LEARNING something from it ! Even if they don't end up with as much per customer profit as other models he still makes more money in TOTAL than all of you combined! Isn't that what counts?!?!?Who says we're not learning things along with insightful criticism? It's not so much of beating it down as asking questions about it. He may choose not to learn from my model, but when boastful claims are made on a forum talking about "running a hosting business", it will raise certain questions.

Total revenue is no measure of anything except that a lot of money comes in. It's what goes out and what is left over that matters. I'm not jealous that his salary *may* rival mine, but am merely looking at what has been posted and what is available and trying to make the two ends match up. If I see a gap, then I ask.

Matt, you've got an interesting way of always using "marketing speak" to bash your point home. I know your company generates a lot of revenue, but I think your expenses are at least even with revenue, and that you depend on a heavy signup rate to fuel current expenses in some way, shape, or form. You cannot have 100+ quality employees, top end hardware, pay out millions to affiliates, and charge $7/month (or $5/month if you count hostmonster) and still be "rolling in it".

But, maybe you have a magic flute that makes it all possible. :D

I will type that a few of your statements and theories have piqued my interest and may open up a few new areas to investigate.

- John C.

mheaton

04-04-2007, 09:56 PM

We know this how? Because he says so?

Let me tell you a story about my company. We have customers who love us so much they pay us triple what we invoice them, we have had dozens of clients name their kids after us, we have about 4000 signups per day and the only customer we've ever lost is that one guy who got run over by a bus. All of our employees actually pay US to work here...and our servers are gold plated and have 110% uptime. How do we do it you ask? Because we are superior to ALL of you mere amateur hosts!

Okay, maybe I exaggerated a bit. But you'll never know by how much, will you? ;)

--Tina

Only one person named their kid after me (Matts a great name by the way). You forgot to mention that Zeus was my father, and if you order now you can get a 10% discount of a bronze statue of me to put in your backyard :)

We DID get a plate of what I think is coconut cookies from a lady in Pennsylvania today because she said her support was so fantastic she couldn't believe it (Hostmonster customer). I am NOT making this up. We passed them out to support today. How many of you have had customers send you cookies? If you haven't then your support dept isn't good enough yet :)

bwb

04-04-2007, 10:01 PM

cowabunga

04-04-2007, 10:20 PM

Are you ready?? Here is the secret :) On Bluehost now 45-50% of our signups are word of mouth or referrals that we didn't pay a cent for. On Hostmonster that number is almost 40% (Keep in mind that Hostmonster is only 1 year old and hosts more than 90,000 domains now). Last month (March 2007) we had about 6,000 paying customers (Not domains) sign up that were word or mouth/recommendation sales. That doesn't even include our affiliate program that had huge sales last month. When you hear $100-$150 a sale for affiliate marketing everyone thinks it is impossible to make money. It works, but ONLY if your customers love you so much that they tell all their friends. Why do I share this? I share this because even though I say exactly how we are successful others won't follow because either they can't for financial reasons or they just don't get how support is a money maker instead of money loser because they can't find the column for it in their spreadsheet. It takes time to establish a brand.
That’s not bad, though I’ve seen higher at the same relative customer base (225k+ customers, not domains…) For steady, ongoing growth I target around 55-60% /month contribution off of 80-85% of the base contributing at least 1 sale- this is a rather static number and if it falls 5-10% as you increase overall subscribers, things will unravel very very fast. Then of course a churn rate with a decimal in front of the numbers needs to be in the equation. I’ve seen companies bigger than BH crash at the next few turns in the road you’re facing- You have to remember that these customers are hardly “free” at some point you spent money to acquire the referrer- tracking multi-tier acquisition costs across referrer and referral sales is essential to calculate actual multi-tier blended CAR to measure performance ( for BOB: CAR= customer acquisition rate : ) if you lose sight of the minutia at this level things come back to bite you real hard. As far as affiliate conversion v overall, % are a like opinions and @#$holes you have to consider the source of the click through- they range tremendously from affiliate to affiliate and can shift over time- and with the costs they incur to advertise; the days of the CJ hosting affiliate are over, unless you’re already there, you can’t buy into CJ these days with any money. Conversion of straight organic sales via target advertising and a repeat visit with a really really good website with a solid brand will convert around 9% on a good day- Remember, Amazon.com converts at about 12-13% (supposedly) -though granted it is a retail site for the most part. Tweaking inbound traffic conversion from affiliates, organic search and market-facing advertising is one of the quickest ways to increase sales, depending upon your traffic, increasing conversion by 1% can yield hundreds or thousands of customers per month.

As to whether BH does it right or not I’d say it’s right for right now; as far as being the leader? Nope, still in the middle of the pack. Call John Lee at Hostway …. he had a great day today : ) 20% hmmm the real question is margin, operating margin or operating profit. Operating margin is the real barometer for Bob, op margin = income/net sales v profit margin which is much simpler- net income/revenue : )

OpenReaction

04-04-2007, 11:00 PM

We DID get a plate of what I think is coconut cookies from a lady in Pennsylvania today because she said her support was so fantastic she couldn't believe it (Hostmonster customer). I am NOT making this up. We passed them out to support today. How many of you have had customers send you cookies? If you haven't then your support dept isn't good enough yet :)

Perhaps we don't all get cookies sent to our support department since our service is good enough that it is rare our customers ever have a need to contact our support department. Servers running 100% uptime and the only tickets are RDNS setups and the few that rather have support do the mouse clicks on reboots rather then login to the reboot units themselves.

sigma

04-04-2007, 11:09 PM

...he still makes more money in TOTAL than all of you combined! Isn't that what counts?!?!?

No, that's not the only metric, nor is it necessarily true, trust me :)

Kevin

JohnCrowley

04-04-2007, 11:19 PM

...We DID get a plate of what I think is coconut cookies from a lady in Pennsylvania today because she said her support was so fantastic she couldn't believe it (Hostmonster customer). I am NOT making this up. We passed them out to support today. How many of you have had customers send you cookies? If you haven't then your support dept isn't good enough yet :)We get cookies every few weeks, gifts, pizza bought for us, gift cards to restaurants, lots of free shirts and products from our ecommerce clients, and they have the privilege of paying us more money as well. ;)

- John C.

Aussie Bob

04-04-2007, 11:23 PM

I'm suprised as you are one of the first hosting companies I've heard doing this and I've been railing about this on my blog. Hosting companies loose so much money by not doing this, huge client base that is so expensive to get and then they let them sit there and quit or loose interest.
Many hosting companies have other products or services that they upsell to their client base - be that by allowing 3rd parties to advertise in their newsletters etc, it's hardly new. I'm surprised that you're surprised they're "one of the first hosting companies" to do this. You need to get out a bit more. :)

JohnCrowley

04-04-2007, 11:49 PM

...this is a rather static number and if it falls 5-10% as you increase overall subscribers, things will unravel very very fast. Then of course a churn rate with a decimal in front of the numbers needs to be in the equation.
...
as far as being the leader? Nope, still in the middle of the pack. Call John Lee at Hostway …. he had a great day today : ) 20% hmmm the real question is margin, operating margin or operating profit. Operating margin is the real barometerI can picture cowabunga as Yoda doling out wisdom and prophecies. :D

I'll leave the analysis to you for the larger hosting market. But I'll agree with you on the point of a few mis-steps at this level and a few %'s swinging the other way can bring it all crashing down at the level (middle, not top) BH is at currently. It's a slippery slope I'm happy to avoid. :)

- John C.

BF-Gary

04-05-2007, 03:05 AM

To get back to the OP question there are a few ways to compete...

1. Provide a Niche Service
You will notice from this thread alone that the overselling hosts see there customers as numbers and very quantifiable. Hosting is a service and not a commodity (print that out and put it on your wall and read it every day). If you can literally remove your logo from your site and paste it on another site you know your doing something wrong in your business.

I assure you that your customers bought hosting for a reason. Do you know why? Have you asked them? If you find that reason and help them achieve it I assure you that you will find a niche that will separate you and then won't have to compete with the overselling hosts.

2. Pay for what you use
The other model that competes against the overselling providers is creating a pay for what you use model. You attract again a certain type of customer with this model but it is the opposite of an overselling model.

AH-Tina

04-05-2007, 03:16 AM

How many of you have had customers send you cookies? If you haven't then your support dept isn't good enough yet :)

I've rec'd several gift baskets, CDs, countless gift certificates, an $800 custom made stained glass window, magic trick kit (no kidding), toys for my cat, t-shirts, buttons, wine and...I kid you not...a rear view mirror for my car.

--Tina

Aussie Bob

04-05-2007, 05:26 AM

I've rec'd . . . I kid you not...a rear view mirror for my car.
lol Tina. Why oh why would someone send someone else a rear view mirror? :D

Aussie Bob

04-05-2007, 05:28 AM

2. Pay for what you use
The other model that competes against the overselling providers is creating a pay for what you use model. You attract again a certain type of customer with this model but it is the opposite of an overselling model.
That model has always intrigued me. Has anyone seen that model used with success?

scribby

04-05-2007, 07:01 AM

lol Tina. Why oh why would someone send someone else a rear view mirror? :D

Maybe they own a car junk yard website?

scribby

04-05-2007, 07:05 AM

AH-Tina

04-05-2007, 08:37 AM

lol Tina. Why oh why would someone send someone else a rear view mirror? :D

This was a long, long time ago. It was a big ugly thing that fit over your regular mirror and was supposed to be superior. I found it clunky and it got in the way of being able to put my sun visors down...so I only used it for about a day.

--Tina

mrzippy

04-05-2007, 11:15 AM

I have never seen a "pay for use" model that seems like it would work.

The problem is that currently, you can only really measure disk space, bandwidth, databases, etc.

So really... if a customer is using more then 100mb of disk space, then they would be very tempted to switch to bluehost and get a thousand times more space for probably the same if not less cost.

Since the "measurement" or yardstick to compare a "pay for what you use" type of web host would be the same yardstick to measure against the crazy 200gb for $7 plans.... the customer is still likely to pick the one he things "bigger must be better".

I hope that makes sense.

The only way I can see "pay for use" ever working is if you could charge for actual CPU or memory usage. But then, the pricing would need to be small enough that the customer doesn't feel moving to 1and1 would be a better deal.

I have seen some hosts charge for their support on a pay per use system. In fact, we experimented with that many years ago with a company I used to partialy own. It worked pretty well, but that was many years ago before most customers now expect 24x7 service to be included with even the cheapest hosting plan.

(ie: The only way I can see a "pay per support request" system working is for very large corporate customers, who are already familiar with this sort of support method for the software they have...)

BF-Gary

04-05-2007, 03:03 PM

That model has always intrigued me. Has anyone seen that model used with success?

I believe that it is being used successful with Amazon's S3 service.

tash pop

04-05-2007, 06:46 PM

Since when did you know how much we all make anyways?

Sorry I didn't mean to offend anyone by saying this. You're absolutely right, I don't know that it was just an assumption, very possibly incorrect... what I ment to say was we should spend our energy trying to learn some techniques for customer aquisition from him to use on your own 'profit model' instead of spending all the energy bashing him... sorry again for those of you offended by my comment.

quixote

05-11-2007, 10:31 AM

GregoryS

05-11-2007, 01:37 PM

Its very simple get an account and use up all the 300gb of space and fill up with junk.

than just stream some videos to use up the 300gb of transfer they give you too.

and see what happens.

datapimp

05-11-2007, 09:46 PM

Now I remember why I haven't been to webhosting talk in a couple of months.You'll have a lot more time to waste here after EIG buys you out.

layer0

05-11-2007, 09:47 PM

You'll have a lot more time to waste here after EIG buys you out.

:agree: :smash:

Evolver

05-11-2007, 10:32 PM

Good to hear but you are in a small small small minority out of the hosting companies, can you PM me URL and how many people you put on a server to check your math?

Actually I'm pretty sure there are 10X more hosting companies who never heard of WHT or any other hosting chat site then there are hosting companies on these kinds of sites.

artagesw

05-12-2007, 05:47 PM

A bit late to this discussion, and sorry if I take it off-track again. But I was fascinated by the exchange between Kevin and Matt around the security of PHP on shared hosting. I see valid points on both sides. But I have a simple example and hope one or both of Kevin and Matt might chime in with their respective opinions.

It is my understanding that in order to run PHP under mod_php, the PHP processes will all run as the web server's user (typically "nobody"). So, in order to run a PHP script, that script must be at least readable by the "nobody" user. This means that any user's PHP script can read any other user's PHP script.

This seems to open the following security danger. Quite often, PHP scripts will need to interact with a database. Take, as an example, the combination of WordPresss + MySQL. Typically, the login and password information for the database connection is stored as an executable PHP file.

So, here's the potential problem I can see. Any user can write a simple PHP script to read another user's database configuration information. Once they have that, they can use it to gain full access to the other user's database. With that, the database can be read, written and even deleted.

How can this type of attack be prevented? Is it possible to prevent this under mod_php? Is fast-cgi a safer approach in this respect?

Perhaps this issue should be moved to a separate topic. Moderators, please feel free to do so if you deem it appropriate.

layer0

05-12-2007, 05:49 PM

sigma

05-12-2007, 07:17 PM

open_basedir is one answer, which depends on the inherent security of PHP. Another answer is cgiwrap or suexec, which depends on the behavior of the user developing their site.

Kevin

siforek

05-12-2007, 07:42 PM

yes, I had a bad experience with one of those company.
1&1 company.

When I start to share some music and video files with my friends,
they block my account, I called them hundreds times, they first tried to tell me it because my location or internet envirment was not good. After weeks negotiating, they finally admitted that they block my account, and they showed me some policies to defend themselves. I would never trust those companys again. lier!

Anyone who does a little research on a hosting company before buying will rarely run into these problems. Always read the TOS and choose a hosting service that can support your needs. Hundreds of gigs for cheap has to tell you something, right?

Most people will learn their lesson after 1-2 times.

quixote

05-13-2007, 10:23 AM

Anyone who does a little research on a hosting company before buying will rarely run into these problems. Always read the TOS and choose a hosting service that can support your needs. Hundreds of gigs for cheap has to tell you something, right?

Most people will learn their lesson after 1-2 times.

the most nasty thing they have done is charge my credit card after I called them to cancel the package. A billing clerk promised me that they would not charge me again after that phone call. But they did, I found out that 2 twos later. I just hate to give a penny to such a nasty company. I called the bank few days ago.

Biju

05-13-2007, 01:59 PM

simple thing is people must change. my personal website is not hosted with a company with a very reasonable plan.

I know what a company can offer for the amount he pays, so i never look at these hosts plan or offers. They all are crap.

kermit2

05-14-2007, 10:45 PM

Hi,
I've been noticing lately that there are a growing number of Insane hosting plans out there from reputable hosting providers. I had a chat with one of them today. I won't mention the name of the company but they offer 200GB Space and 2000GB Bandwidth/m for US$6.95/m

www.godaddy.com (http://www.godaddy.com)

This is obviously insane, but I wanted to see how the sales chat would go if I asked them how they could offer so much for so little. The answer was initially "yes, we can do it". I then went further to ask if I purchased one of these plans could I store my CD's of photo albums and videos up to the 200GB limit. The guy also said "yes", but added that because its in a shared environment CPU usage could not be allowed to go to high (according to their TOS). I could smell a rat, a big fat greasy rat :) .
In any shared hosting envirmoment one customer can use the complete CPU/MEMORY.

One of the simplest way in the past done by angry customers is to execute a script which has a loop of malloc.

Am I the only one or are people getting sick and tired of the rediculous hosting plans that are coming out these days. The above plan was from a reputable hosting provider and considering there are dedicated servers around today that offer less disk space and bandwidth for hundreds per month - isn't it time something was done about this? Or could the industry be heading for a "correction"? I hope so !! Because things are getting way out of hand.
If you can't beat them, join them is (I presume) an English expression.
I do not think that their plans are strange, you may forget that the bigger you can purchase hardware and services the more discount you can claim.
Do not think that on big orders they settle with +10 or +100 discount rates.
If you purchase 10.000 disks or 1000 sans you are telling the manufacturer (rarely that a distributor comes between them) what you are willing to pay and challenge him with an offer from some not known Taiwanese or Chinese manufacturer.

Big manufacturer do not want to lose a big deal to their competitor, they earn their money on marketing (customer stories on website of a company are often paid through the discount they had to provide).

Google may have over 450.000 servers and has several own datacentres and has hardware in datacentres all over the world.

Someday, they will start hosting services, do you think that GoDaddy can compete against them?

Google can dictate ISP and backbone suppliers, if an ISP or backbone supplier doesn't want to compy to their pricing then they will tell them that they will not provide Google search to that ISP/backbone supplier, how many ISP's/Backbone suppliers would dare to risk that?

A man once complaint about a ruler to a figure in the bible, that figure adviced that guy not to complain to much, because he can not know if the next ruler would be worser.

Maybe we more sensible Web hosts could take action to stop this. Maybe buy one or 2 of these plans and start loading massive files into these accounts :) - like photo albums, videos, open source OS, etc. Start giving these guys something to worry about? You reckon? Nah I won't be so nasty, but oh please - this trend has gotta slow down a bit ! It's a free market in a free world, you can only stop them by becoming the biggest, sell them out (or compete them to dead) and then design the market as you want.

I do not think that if 50% of the consumers of a company of Godaddy are utilizing the maximum of their account that Godaddy start to make any loss.

They would starting to lose credibility and customers when it comes out that if situation as described above occurs they aren't able to deliver.

At the other hand, do you want customers that are going for big storage and allot of traffic? I rather have 100 customers that I can put in 200GB + 2000GB traffic, then one that uses 200GB + 2000GB traffic (unless he is willing to pay for it).

I advice you not to look at others much, you as each other probably have your own way to distinguish your self, like personal contact, shorter communication lines and better support and advice.

You can also use a godaddy (or other) account to offload big files, online backups etc..etc.. you can mount to that storage and register an url such as offloadedcontent.com and put big files their for your customers.

Just go with the flow.

btw: I have a background at large ISP's and backbone suppliers (telco's with own darkfiber) and have attended negotiations.
It's normal in that world to enforce your wishes if you have something to bargain with.
An example, backbone suppliers (telco's with own darkfiber in the ground) do not peer with other parties, because they are earning their money with traffic.
But if you are a hosting company with 1 million websites, and you as a backbone supplier see that 50% of your traffic goes to them (outbound) then, you might reconsider peering with them.... which would mean for the hosting company that their inbound and outbound traffic through that peer cost them and the backbone supplier nothing. The backbone supplier makes their money on the other side etc..

kermit2

05-14-2007, 11:07 PM

I forgot to mention that big parties such as godaddy are themselves Domain register, so they make almost 100% profit on the domain name + > 50% on their hosting packages.

cscertified

05-15-2007, 01:14 PM

I forgot to mention that big parties such as godaddy are themselves Domain register, so they make almost 100% profit on the domain name + > 50% on their hosting packages.

Where did you hear that they make 100% profit on their domain names?

PEAK-Bobby

05-15-2007, 02:52 PM

Humans will always think, "Bigger is Better" to bad their wrong! I do think the hosting companies need to do something about this, I am behind whoever wants to purchase their $6.95 10,000GB Storage 10TB Bandwidth package and filler up till she explodes!

As for the web hosting review sites, they are all excuse my language "BULL SH**" you guys actually think those top hosting companies you see on their sites are the best? No way !!! their support is from india where they don't speak english, their plans are fraud because they offer 1 thing and their TOS says another. The only reason that they are on the top 10 of the hosting reviews is because they spend the money to get there. I have not seen a hosting review site that's actually doing reviews!!! They will take your money and place you on the top 10 if you just opened a reseller hosting business!!.

Enough is Enough, where is the WEB HOSTING ASSOCIATION COMMISSION.

kermit2

05-15-2007, 07:31 PM

Where did you hear that they make 100% profit on their domain names?

If you are a registrar, and it cost you nothing more then $ 1,- to maintain the infrastructure and selling your domains at $ 8,- then you make 700% on your domains.

kermit2

05-15-2007, 07:33 PM

Actually I'm pretty sure there are 10X more hosting companies who never heard of WHT or any other hosting chat site then there are hosting companies on these kinds of sites.

Actually I found these kind of websites after troubleshooting some specific problems.

If you work at an ISP that has a few million customer then you do not have the time to stick around on any forum.

kermit2

05-15-2007, 07:38 PM

Humans will always think, "Bigger is Better" to bad their wrong! I do think the hosting companies need to do something about this, I am behind whoever wants to purchase their $6.95 10,000GB Storage 10TB Bandwidth package and filler up till she explodes!

Within 10 years it would be possible to offer these kind of packages. (mark my words)

It has to because filmcompanies want to distribute their films digital and online, and if you are sending FULL-HD movie, then you would atleast use 30GB traffic per film per customer. So the receiver must also be able to receive that kind of traffic.

As for the web hosting review sites, they are all excuse my language "BULL SH**" you guys actually think those top hosting companies you see on their sites are the best? No way !!! their support is from india where they don't speak english, their plans are fraud because they offer 1 thing and their TOS says another. The only reason that they are on the top 10 of the hosting reviews is because they spend the money to get there. I have not seen a hosting review site that's actually doing reviews!!! They will take your money and place you on the top 10 if you just opened a reseller hosting business!!.

Get used to it, when you have thousands and clients one day, and you see what your overhead is on support you also may to outsource it to countries such as India.

I rather think that India is going to become expensive, so Pakistan would be the next country in line, as they also are native English. "Hi, with Osama, how can I help you today" :-)

Enough is Enough, where is the WEB HOSTING ASSOCIATION COMMISSION.

This wouldn't work, online business is dedicated by the world and the only one who have any influance are the big corporations, see my reply previously.

sigma

05-15-2007, 07:48 PM

If you are a registrar, and it cost you nothing more then $ 1,- to maintain the infrastructure and selling your domains at $ 8,- then you make 700% on your domains.

So how are you offering these domains without paying the registry and ICANN?

Kevin

kermit2

05-15-2007, 07:53 PM

So how are you offering these domains without paying the registry and ICANN?

Kevin

www.godaddy.com (http://www.godaddy.com) = wild west domains which is a registrar!

fee for ICANN which they pay is only 0,50 USD per domain.

sigma

05-15-2007, 08:00 PM

You only answered half the question. Do you know what the registry fees are for the various TLDs? It doesn't seem like you do.

Kevin

kermit2

05-15-2007, 08:07 PM

You only answered half the question. Do you know what the registry fees are for the various TLDs? It doesn't seem like you do.
Kevin

TLD registrars for COM/NET/ORG only pay 0,50 USD per domain to ICANN.

You need another 0,50 USD to maintain your infrastructure, so they cost price per domain is 1 USD.

kermit2

05-15-2007, 08:10 PM

Just read this article: http://www.techsoapbox.com/ex-icann-board-member-verisigns-cost-per-domain-is-014/

Dolbz

05-15-2007, 08:48 PM

Just read this article: http://www.techsoapbox.com/ex-icann-board-member-verisigns-cost-per-domain-is-014/

(http://www.verisign.com/press_releases/pr/page_041054.html)http://www.verisign.com/press_releases/pr/page_041054.html

I'd suggest you read that. Verisign are the TLD registry and they charge fees on top of ICANN's transaction fees. You can't get a TLD without paying Verisign so although they may actually incur costs that are peanuts, they have the legalised monopoly of the entire system.

I think you have got confused between registrars and registries. A registrar conducts business with the registry (so long as they are accredited by ICANN). For TLD's there is only one option and that is Verisign, so no one can get cheaper prices than those quoted in that link.

cscertified

05-16-2007, 01:39 AM

(http://www.verisign.com/press_releases/pr/page_041054.html)http://www.verisign.com/press_releases/pr/page_041054.html

I'd suggest you read that. Verisign are the TLD registry and they charge fees on top of ICANN's transaction fees.
I am glad you posted this because I was sure he was way of with his $$ projections for being a registry.

JRS-Hosting

05-19-2007, 08:58 PM

I have seen one of these plans and have owned one, the host I got it from had a small TOS and it didn't say anything about how much CPU you could use, no hidden limits or anything.

remcom

05-20-2007, 01:37 AM

First off. I do want to know if Kevin and Matt are going to Hostingcon this year. Maybe we can setup a ring for them.

Back to the topic of the massive plans in today's market. They are overselling there services. I'm never one to argue about this business plan but if it is a marketing ploy how far can you go. You give so much bandwidth and so much space to a customer and at times you may not be able to deliever these resources. Now obviously there are some hosts that can but what about the ones that can't. The one's that closed accounts or suspend users for misused or violation of the TOS?

These companies mislead customers, hiding details of usage in a long winded TOS that most customers agree too without reading. I'm not a lawyer but I do know in some states, like my home state and place of business New York, there are consumer protection laws against such problematic marketing schemes.

I would not be surprised to see a web host one day get sue'd by a state attorney general for complaints they have against them for falsely representing the product in which they sell.

Back to the top. When can we see Kevin vs Matt, its not Las Vegas this year but Chicago will work ;)

sonixi

05-20-2007, 02:28 PM

About the 200 GB space/200 GB traffic / $6.95 / hosting plan.... If a customer is not smart enough (dumb) to see the blatant lie in such a plan, then a reputable host would probably not want to deal with such a customer anyway. Personally, I would not wish to chase $6 per month customers as if they are doing my business a favor by paying such a low price. Instead, I would put my efforts into a different business model... business 2 business type of deal. Most business owners know what you know already and that is, <let's say it together> You get what you pay for.... nothing more.

remcom

05-20-2007, 11:35 PM

well to the customers defense, its not that they are smart they just see is as being more then the other guy. We are in a world of bigger is better, get more for your money type style and it will always be like that.

Plus a lot of the customers these hosts are getting are the first time hosting clients who know nothing but the fact they need hosting to put a website up. Let it be a mom/pop shop, an ebay person, or that family website. The amount of new "uneducated" customers is going up.

Yes sometimes you are forced to explain how to setup an email or have to explain other simple things to them but any business that would turn their back to a potential client base that large is either, making enough money already, or doesn't really want me make money. This type of customer is going to out number (or might as well already have) the customers we have been used to for so many years. The web developer, the programmer, the reseller, the techie are still great client but you might want to stop and think about the others you may be missing out on.

Look at web.com. They focus on this exact client base and have done really well at making sure they get sales from it.

remcom

05-21-2007, 02:22 PM

I'm trying to decide if your calling hosts like hostgator/bluehost/IXhosting/midphase/startlogic, not "Real Webhosts" or just poking at the hosts that aren't that big and are still offering plans in such sizes.

I really do not think a verification logo would really work. It would be nice to see some sort of "web hosting association" but I don't think it could happen. To many factors in the industry plus it would have to be a huge marketing event to educate the population of such an association. (Like the BBB has done)

It could be possible but I highly doubt it.

Dave - Just199

05-21-2007, 02:25 PM

Perhaps "real webhosts" was not a good term..

I dont know that you would really need to educate the public, I think seeing a logo on your site would be enough. It would not get people to go out and specifically look for you as a webhost but it would catch traffic on your site.

crux_op

06-03-2007, 12:02 PM

What's wrong with these plans? They're not lies.
And even if you're not the average consumer you can still benefit from it.

I have servers of my own to handle DB transcations, and CPU bound scripts but when I want to toss up an add banner I'd rather not use those servers.

A few months ago, I bought a plan like this. $6.95 per month for 3TB of bandwidth, 200GB of space. I haven't put anywhere near 200GB of content on the shared host, but I've used more than 1.5TB a month just on advertising banners.

I think that's what these sites do well at, serving static content at a slow (they cap you to X bandwidth per day, so you can't burst) but regular pace.

sprintserve

06-03-2007, 09:07 PM

It probably hurt to hear this, but such tactics will always be around and thrive. The reason it's being done again and again and by more companies is that the end result pays. Perhaps it doesn't pay with a certain percentage of the clients, but as a sum of all parts, it does. When companies started offering 10GB space and 100GB bandwidth for 9.95/month, everyone here predict that they are going to roll over and die soon. But it doesn't happen. Instead a couple of years down the road, it's now at 200GB space etc. This clearly indicate that the model pays, and these companies are not only successful, but hugely so, and continue to tap to the limits such advertising. Human behaviour dictates that they will always want more for less, and it is this weakness that such companies target.

Don't get me wrong. Some of them may not be the bastions of good support or models of the hosting industry. But they make the dole and they don't really care what the rest of us thinks.

Hard truth of life.

MrZodiac

06-03-2007, 10:02 PM

I would say 99% of these big huge plans are oversold.

bwb

06-03-2007, 11:57 PM