Do you think its a good idea to offer customers pay as you go bandwidth instead of giving them a fixed amount of bandwidth? I was thinking about implementing this, but I wanted to hear some opinions first. I think it would be attractive to sites that are just starting up and may not need 1000GB of transfer in a month. Has anyone tried this?

I've seen a few companies that do it, but none that are that successful. It's not very attractive to customers when you can get 3TB/month for $7.95/mo

well
if you do have an attractive offer like $1/10 GB or something like that.
and it should be post paid.
i think u'd do some awesome business....

Well, the thing is that I believe that web host can offer what they are currently offering because not everyone uses up their full bandwidth allocation. Big numbers are usually attractive for people. I am sure that some will use close to their allocation but as long as overall bandwidth usage for the server does not exceed that offered by their datacenter, they are good to go.

Actually, at the moment you do have the pay-as-you-go where you are given an allotment of free bandwidth usage then you pay for every gb above and beyond that number.

As I said earlier, web hosts offer low prices with big numbers to attract customers. They do not expect everyone to use all their bandwidth alloted to them. So if you offer stripped down plan with 0gb bandwidth then bill per gb they use, the plans would not look all that attractive anymore and it will be different to manage.

- Virate: Yes post pay was what I was thinking and I was thinking of $.10/GB as the rate for now

-Eddy: Good point. What do you think about fixed bandwidth limits for those who want them and also offering pay as you go aimed toward sites just getting off the ground?

$0.10/GB is not really sustainable because I believe that datacenter may charge somewhere between $0.50 to $3.50/GB outage charges. You need to charge more than the outage charges to be cost effective, in case your server exceeds the limit.

Actually I like the system as it is now. Pay as you know may be a little troublesome to manage.

From a purely marketing perspective you may find it scares off some people during the sign up process. If the potential client has to do math in their head to estimate what they're likely going to be paying, you're more likely to lose people.

Any experienced customer is probably going to have an idea what they do in bandwidth each month. Reading you're site, they'll need to multiply that by your per gb price and estimate their cost from there. Whereas if they see that there's a TB included at a flat rate, it's a much simpler calculation. "Do I use more than a TB per month, yes/no."

Also, for any newbie customers they might not really know what you mean by bandwidth at all. Seeing a number that could make their monthly fee vary might make them get scared that they're being swindled some how.

As much as possible when clients sign up, they want to know what they're going to be charged and as the vendor, you want them to have to think about that as little as possible. The less time spent thinking about spending money, the more likely they are to spend it.

I'm looking for a system like the one on nearlyfreespeech.net, I think this could be the future for webhosting, but I don't know any similar to this, it's a pain!