my freand was telling me (scaring me) about the legalites of hosting and if one customer finds a loop hole in the contract then he can mess with you.. or if any little thing goes wrong then he can sue for million in damages and what not..

what legal stuff should i know before becoming a host

also he was telling me how this might be a waste of time, and telling me how many compaines have gone belly up .

A) Have a lawyer or equivalent write up your terms and conditions.

B) Yes many companies have gone belly up, but not all. Speak the truth, provide what you offer (important point that one).

C) Know your terms and conditions.. you will get many questions regarding them.

Best info I can provide:

1) Get a lawyer
2) read what other hosting companies are doing... ask them, they may tell you. Read what they have online.
3) Get insurance. The kind that helps if someone does sue you.
4) Get a lawyer... your laws in your state or country will vary....

Belly up... naw, you are kidding right? Some needed to close... a lot more need to close.... if you provide great customer service, hooked up with great equipment, fast backbone connections, 24 hour help and a will to never sleep... then you might make it.

do you all have lawyers and insurance..

another question: do you have to get a buiness id... or can you just do buiness without registering all that stuff..

i just simply wanted to launch a website slap a name on it setup the deals and get a merchant account and resell the resoursces from my host..

is thier anything else i need to do.. what else should i know..

Not millions, maby thousands.

Register your business name, register for taxes, register for all that stuff.

We dont need anymore "Timmy's".. :rolleyes: :stickout:

Me anth?

I was referring to macielter ... but yeah, all business's, if they wish to call themselves that, should be legal :)

You really should stop posting at the same time as me, looks like your a clone or something... :D

Originally posted by macielter
do you all have lawyers and insurance..

another question: do you have to get a buiness id... or can you just do buiness without registering all that stuff..

i just simply wanted to launch a website slap a name on it setup the deals and get a merchant account and resell the resoursces from my host..

is thier anything else i need to do.. what else should i know..


Your thought process is going down the wrong path.... Set your business up properly and you will make it.... don't and you will fail.

Yes, I have a lawyer. I have a business name. I don't have insurance, but I know I need it... I was checking out rates last Thursday....

Oh, you might want to take a business course as well...

tehehe..

I R 1337 CLONE

:rolleyes: :stickout: :blush:

Gah.. woops

Everybody is replying fast today.. :rolleyes:

Originally posted by hekwu



Your thought process is going down the wrong path.... Set your business up properly and you will make it.... don't and you will fail.

Yes, I have a lawyer. I have a business name. I don't have insurance, but I know I need it... I was checking out rates last Thursday....

Oh, you might want to take a business course as well...

well , see, i just wanted to do this for a little side money while i go to school (college).. i didn't want to make a big deal and register as a buiness and for taxes and all that crap...

i thought it was just as simple was making a website and start selling my resources and advertisign in my local newspaper and maybe some internet banner ads...

im not gonna host more then 10-20 people.. this was is supose to just be pocket change .. like money to party and just have fun with.. my parents are always bitching at me about how expensive i am (they spoil me to death).. but i just wanted to have my own money ... once again, im not planning on hosting hundrends of people , (just under 50 people would be cool)

One thing you might want to know is that IF someone finds a loophole in your TOS and they do sue you, they can only get what is determined they could have LOST due to whatever downtime you may have caused.

They can't take millions if they only would have made a hundred bucks... and they have to prove it. It's not as easy as most poeple think or many of us would have already owned a few hosting companies :)

I own an ecommerce business and lost thousands of dollars due to downtime caused by a host (long time ago). We even consulted our attorney about it but in the end it wasn't worth trying to get it back... after spending the time with the attorneys, court fees, etc. you could easily spend much more than you lost.

Check with your state about their laws concerning very small businesses. Some states, like Washington, allow you to have under $12,000 without filing for taxes at all. (Something about the minimum tax deduction you can claim is more than the taxes on 12,000 so it doesn't matter).

Anyway, check with your state, it may be easier than you think! Also, a sole proprietor business license can be very cheap ($20 in some places).

how do i check with my state.. like who do i call... and whats the purpuse of having a business license.. what is so special about a business license... and what happens if just run my small buiness without any of that stuff....

Originally posted by macielter


well , see, i just wanted to do this for a little side money while i go to school (college).. i didn't want to make a big deal and register as a buiness and for taxes and all that crap...

i thought it was just as simple was making a website and start selling my resources and advertisign in my local newspaper and maybe some internet banner ads...

im not gonna host more then 10-20 people.. this was is supose to just be pocket change .. like money to party and just have fun with.. my parents are always bitching at me about how expensive i am (they spoil me to death).. but i just wanted to have my own money ... once again, im not planning on hosting hundrends of people , (just under 50 people would be cool)

Being a web host is like maintaining a public utility, It always needs maintenence.

So if you're going to get into this business thinking it's the quick and easy way to make some cash, I'm sorry to tell you, but you're wrong. Being a host requires knowledge, time and devotion. If you want to actually succeed and make some cash you better be prepared.

So re-think everything before you take the plunge. It may look easy, but believe me it's not. Even after the first few months after you start, you may be making pretty much next to nothing (money wise). It takes some practically months to even turn up a profit after they start.

My last "tip" for you: Create a business plan. There's nothing like seeing millions of posts on WHT like: "Host ABC is gone, need hosting...!" :rolleyes:

You'll thank me later.

Anyways, Good luck in your future business adventures...:)

Hi macielter,

Even if you're only reselling to friends and family, you have to report your income for tax purposes.

Depending on local laws, your "startup" expenses could be very small: registration of a fictitious business name, municipal business license, and you're done. Check out the Small Business Administration, looking at setting up as a sole proprietor.

Everyone who's advised you to think this through is right on the money. Better to put forethought into your business now, than find yourself "drowning" or feeling overwhelmed later on. You'll also have to actually do work, do research, even if you're only going to offer hosting to a few select friends and family members. TANSTAAFL (there ain't no such thing as a free lunch).

If you're just looking for some extra pocket cash while in college but you do want to be a web host some day, keep watching WHM for offers of work doing tech support. This will get you working in this area without having to make a larger time commitment while you're attending university.

Originally posted by living_media
Hi macielter,


Depending on local laws, your "startup" expenses could be very small: registration of a fictitious business name, municipal business license, and you're done.

what does this mean.. does it mean the name is fake or soemthing..

also , another question: what happens if i don't report what im doing.. like if i don't get a business linces or report this for my tax..

ive never done my taxes.... i don't even know how it works.. my parents do all that.. they just give me money and i go to college..

you all make it sound as if you have to spend hour and hours working everyday.. when reall all you do is sell your resources and let your customers use those resouces.. what more is their to it.. the only work i can think of is advertising.....

Originally posted by macielter


what does this mean.. does it mean the name is fake or soemthing..

also , another question: what happens if i don't report what im doing.. like if i don't get a business linces or report this for my tax..

ive never done my taxes.... i don't even know how it works.. my parents do all that.. they just give me money and i go to college..

you all make it sound as if you have to spend hour and hours working everyday.. when reall all you do is sell your resources and let your customers use those resouces.. what more is their to it.. the only work i can think of is advertising.....


Wow.. Well there is a TON more to web hosting than you have seen then. Start searching around the forums to try and find out more. Something is always bound to go wrong, and you better be ready to fix it and deal with the customers. You also better be ready for your customers calling/demanding support in the middle of the night because they didn't know how to do this or that. There is a ton more than what you are seeing, beware and start your research! :)

Originally posted by Taylor
There is a ton more than what you are seeing, beware and start your research! :)

Yeah! Research is key.

Do your reasearch, so you can avoid the common pitfalls a startup usually encounters... ;)

Thanks :D

i didn't want to make a big deal and register as a buiness and for taxes and all that crap...

Be carefull, it all has to be legit.

Else there will be HUGE issues

It's important to read up on the law and have a good contract and/or lawyer. In your service agreement, you want to be sure to clearly set forth what you are warrantying and what the remedy will be (for each hour of downtime reported, 1% of your monthly fee credited) of whatever, under what circumstances the customer can terminate and what the costs are, have a good clause waiving implied legal warranties and lmiting your liability, comply with the Digital Millenium Copyright Act which can almost ensure your limiting your liablity for copyright infringement from your users' postings and software if you follow the steps in the law, and so on.

There's lots of good legal information on www.findlaw.com, www.entrepreneur.com, www.sitepoint.com and others.

Coollawyer
J Silver, Esq.

Originally posted by macielter
what does this mean.. does it mean the name is fake or soemthing..

Yes...and no. The name is "fake", in that there isn't a human being named, say, Scribehost. It's not fake, in that registering a business name legally establishes that the registrant has the right to collect fees as the fictitious entity. You're creating a business entity with a certain name.

In many places, you have to register a fictitious business name (also known as a DBA, or "doing business as") only if you intend to do business under a name that is not your own.

Originally posted by macielter
also , another question: what happens if i don't report what im doing.. like if i don't get a business linces or report this for my tax..

While it is possible to try flying under the radar and not report your income, it's a gamble. You run the risk of someone somewhere at some time asking you how you got the money, or what you did, or how you payed for XYZ. Once the government finds out that you drew earnings for a given time period, but did not report it, they will charge you heavy penalties based on an estimate of what you earned. I don't know how they calculate it, exactly. I've never cared to try the odds - always reported my income.

Doing your taxes isn't that difficult - you just have to know what's involved, and you're set. Your local junior college or community centre might have easy courses in tax preparation.

Originally posted by macielter
ive never done my taxes.... i don't even know how it works.. my parents do all that.. they just give me money and i go to college..

Welcome to the wonderful world of being an adult. It sucks, you'll love it ;->

Originally posted by macielter
you all make it sound as if you have to spend hour and hours working everyday.. when reall all you do is sell your resources and let your customers use those resouces.. what more is their to it.. the only work i can think of is advertising.....

...well, yes. You didn't think that it was all beer and skittles, did you?

There's figuring out what resources you're going to sell - and then figuring out how you're going to get those resources, and from where. If you want to resell hosting, you want to make sure that the company upstream from you is going to provide you with the tools to be a competent reseller. Are their servers always going down? Do they keep up-to-date with hardware and software? Do they take care of security issues? And so forth.

Then there's maintaining your resources: control panel updates and installations, security fixes, server maintenance, preparing and sending out invoices to your clients (or finding and installing software that does), tracking your business expenses, tracking your income, creating help docs for your clients, providing customer support, checking to make sure that clients aren't defrauding you... Sure, if you're a hosting reseller, you will have fewer of these to take care of, since the upstream provider will be handling server maintenance. But you still have to take care of client interaction and calculating your own costs and income.

Unless you only ever have one single client and don't ever do any advertising, you will work hours and hours. Some days may be less busy than others - that's the nature of the beast. You may spend a lot of time your first year doing research into the legal issues of running a business, and finding software and so forth - and you'll think, what have I gotten myself into?!?? We all do it - it isn't as overwhelming as people may think.

No joke, running a good hosting business is no game. Advertising is work. Customer support is work. (For most of us, we like doing it - so we do this rather than, say, go into investment banking or some other field.) Once you get a customer, you have to work to keep that customer. It's actually more costly to find new clients than it is to keep current ones - so make sure that you provide top notch service and you'll do fine.

No use repeating what everyone else has already said, but the amount of time you spend setting up and maintaining this business could all but kill you, in both a mental and physical sense. The only reason I got into it all was because I did network/tech support for about 4 years and already had a grasp on what it takes to provide good customer service. If I would have known it was going to become a complete change of lifestyle I may not have chose this path. But here I am :)

One of the most important issues for US web hosting companies ( physical server in the USA and office in the USA ) is that you have to abide by state business consumer laws and contract law. Many host think that becasue it's thier servers they can host whom they want and refuse others. well if it's not spelled out properly, they could easily get a suit. Good example of this is hate speach site. if a web host does not include it in there AUP ( not the TOS ), there is no legal grounds for the web host to remove the site. That's why many host cover the basic group of A) Adult material, not porn. Porn only covers the media presentation of a sexual act, adult matierial covers porn and objects and product that are in a sexual nature, b) hate speach, C) wares D) spam affiliated sites.

Being in NJ we have very strict laws about consumer rights ( we are tougher than California ) and have strict contract law. so you really need a lawyer and a few TOS and AUP so that you lawyer can review and draft them. from what I understand, industry contract like TOS & AUP can not be copyrighted due to the nature of the industry. but I could be totaly wrong about that.

Now some other fine points:

having servers in the USA, does mean that your equipement can still be siezed in a court injuction. ever wonder when certain large host are registered offshore. and then lease thier server from another sister firm ( also off shore ) and to top it off have no easy trail, that's because a warrent can become invalid if not presented to the correct party, giving time to the host to move the servers data from one location to another. Rather nifty way to keep client services to a high level.

Mike

so all i really have to do is copy the TOS from another host ?? i know one that has been up and running for about 5 years... i can just go into their TOS and copy and paste the TOS...

my next set is to get a buiness lincese.. but im 19 , i wonder how that will work out..

You can get a business license at 19.. but a lot of states don't even require a license, but rather just a DBA, which was mentioned earlier in this thread.

And there is another thread going on about copying a TOS, which technically I believe is copyright infringement. But as many people say, most would never find out, nor care to file any charges against it. I guess it just depends on how ethical you want to run your business.

Copying the TOS and/or AUP from another hosting company isn't a good idea. If that company does business in a different state, or is subject to different laws than you would be, or has a poorly-written TOS/AUP, you could be leaving yourself open for trouble.

You would need to extensively study any content you copied, so that you understood all the legal ramifications and loopholes and rights it gave you as a business and rights it left to your clients...and if you're going to do all that research, you're better off writing a TOS and AUP from scratch. You'd be doing the same amount of research and preparation.

This leaves aside things like the illegality of copying content from another site.

And a note on business licenses and DBAs/statement of fictitious business name: these two documents are not interchangeable. Hosting is a business that sells a service, not a tangible product; so you often don't need to bother with a seller's license. But your city or county is often the agency that collects the business license - and I know that in most cities in California, you need both a DBA and a business license. Check with your city's chamber of commerce - they will have information on what documents you need, and a list of where go to.

Originally posted by macielter
so all i really have to do is copy the TOS from another host ?? i know one that has been up and running for about 5 years... i can just go into their TOS and copy and paste the TOS...

You don't seem serious about this business at all. Copying a TOS?

A TOS is pretty much a legal document, (Any good host out there will have their's drafted by a lawyer). And you're just going to copy it?

As I said before, If you're serious about this business, (which is required if you want to succeed), you should follow all of the required steps to be a "legal" host.

What makes you think you can go around and copy TOS's? Maybe if you get written permission, I'd say you'd be fine. But it's not a matter of you just randomly copying.

As I've said a million times before, are you ready to start a company? From what you've said, I'm assuming you're not. Have you made your business plan yet? This is a really serious business. Do you know how to support clients? Do you have Linux knowledge?

The average Joe can't just start a hosting business.

That's why there are crappy hosts out there.

sorry about what I said, to clarify, you get copies of different TOS and AUP, then give them to you lawyer, then they might cut and paste different parts all together.

SORRY folks I mis-stated what I really needed to say.

mike