Hello everyone. I want to know how make money the hosting providers which do overselling with too cheap prices.

For example:

A company sell 1 GB space with $10/year. If they host 150 domains on a server when their revenue is $1500 in total. But the server costs are much more than this. And I think host more domains is not posible with this big offer. So how they make money?

hi

We do not oversell but some hosts that do can get away with overselling because a customer will sign up for say 1GIG space but only uses say 200 Meg if you times that by the number of accounts then there is the free space available to resell

I have worked with hosts that oversell and it all boils down to Maths and working on the principle that most customers will not use the full quota

Hope this helps

Tony

Yup i agree with Zonkers UK , i think even most of the BIG hosting companies out there over sell at least for some extent, wot do u think ?

But yes you can do it without overselling your servers

As the others pointed out, it's all about the math and your infrastructure.

Not every user is going to utilize their entire allotment and that opens up room for additional users on a server (or cluster, etc.).

As you grow bigger, you can have more technology behind you to help you pool your resources together and be able to offer an account that is powered by several servers and not just one, giving you increasing efficiency at overall capacity.

They don't really oversell, as they know that %99 of the customers will not exceed 100MB space usage. It is just numbers they are playing with.

There are a million threads about this topic. I would suggest doing a search and you'll find some great threads all about overselling and the pricing in the market today!

IMO, many customers who buy such plans are beginners, or do not entirely understand their needs. In most cases the most traffic they're sites get is from themselves. But then there are a few who use up all their resources and if you oversell you loose on those accounts.

The income potential I was presented with when initially considering overselling was high, the task of managing was also within our abilities, but my experience working for a larger host that does oversell kept me from doing it myself.

I always felt bad when a customer got a "CPU quota exceeded" error and their site was shut down temporarily, so I'll never oversell. But the fact is that most do. If the numbers and accounts are managed and monitored closely overselling isn't a "bad thing", it's just a different way to do business.

Good Luck!

A company sell 1 GB space with $10/year. If they host 150 domains on a server
That would be without overselling :)
With overselling the host would put 15000 domains on the same server ...

That would be without overselling :)
With overselling the host would put 15000 domains on the same server ...

15000 seems to much to me, unless each accounts has a single static html page. as the max number I have seen so far is 2000 accounts on a single server

You are probably reffering to a cluster server, which is a totally different thing.
But a few hundred accounts is acceptable for a single server.

You are probably reffering to a cluster server, which is a totally different thing.
But a few hundred accounts is acceptable for a single server.

I've seen *reseller* accounts with 3000+ domains hosted :stickout:

A few hundred accounts for a single server is a meaningless metric - we have single sites that require 4 servers ! Ther is no magic "this many accounts to a server" number - its a "range" from 0 upwards ...

The point is that oversellers make their money by stuffing servers full of hostees hoping that the majority dont get close to using what they're paying for. Whether as a business it "works" or not and the impact it has on performance, reliability, uptime, profit-margin etc is the subject of many a heated debate on WHT.

And then one comes and cripples the server.
Happened to me with a client on an almost brand new empty server. He got it to 8 server load (dual core) with just 5 guys online. (proxy script)

We had fun one day.

I had a competitor in the area stop down to tell me how they will put us out of business. He offered 50 gigs of space....gigs of transfer... blau blau blau...for only $6.95 a month.

So to help him I purchased 3 accounts at $6.95 a month and paid quarterly. I then transfered my photo library of about 40 gigs to one account, a community photo library of 45 gigs to another account and lastly a video library of 25 gigs (before youtube took off) for save keeping.

After a few days I notice my galleries weren't coming up. I submited a support ticket and was told they are looking into the issue. The issue was they were running out of disk space. 120 gig hd drive will only hold so much data. :)

Hello everyone. I want to know how make money the hosting providers which do overselling with too cheap prices.

For example:

A company sell 1 GB space with $10/year. If they host 150 domains on a server when their revenue is $1500 in total. But the server costs are much more than this. And I think host more domains is not posible with this big offer. So how they make money?

In actuality, they don't make money, not with a setup like that.