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03-11-2014, 04:04 AM #76Web Hosting Master
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It's not just a US only thing. Maybe a EU only thing? Happens in Asia and everywhere.
Land value goes up. With that there's land tax. Councils and other places also charge higher fees for strata and other things. Therefore space pricing goes "up".
This is why house prices tend to increase even though the building gets older and older?Hyperconnezion - your fast path to success
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03-11-2014, 04:40 AM #77Web Hosting Master
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I don't quite follow what you're trying to say here. Most hardware does come from China. The rest come from Southeast Asia, and in some cases with Intel, Costa Rica. We import hardware all the time and have to declare country of origin on everything, so I can say that with some certainty. This is not only true of Supermicro, but also all the big OEMs, who farm out manufacturing to Chinese ODMs.
It's unsustainable if the only reason they're able to offer that price is because they're not making any margins within a reasonable amount of time. It's only a good deal if they were able to offer that price due to flawless execution and some unique competitive advantage, and not just due to gross oversights on a long-term plan.
It's not about how much you're paying, but what value you're getting for the money.
Let's let some search results do the talking.
Their first offer on WHT in 2010:
http://www.webhostingtalk.com/showthread.php?t=938142
Their first offer for $99, an Atom box in 2010:
http://www.webhostingtalk.com/showthread.php?t=980429
An auction sale:
http://www.webhostingtalk.com/showthread.php?t=984799
Their next offer though is still back to reasonable pricing, $299 for an X3440 with 100Mb:
http://www.webhostingtalk.com/showthread.php?t=986938
Here we see something better than an Atom in 2011, an i3, for $119:
http://www.webhostingtalk.com/showthread.php?t=1039086
Start selling E3's, at $209 yearly or $269 monthly:
http://www.webhostingtalk.com/showthread.php?t=1044225
Then later in 2011, the first Xeon E3 for $99 deal, but with $499 setup fee, or $219/mo otherwise:
http://www.webhostingtalk.com/showthread.php?t=1053900
Then $99 with $199 setup or 2 year term with 3 months paid up front, but still $219/mo otherwise on the next offer:
Over 100 servers deployed, milestone!:
http://www.webhostingtalk.com/showthread.php?t=1061784
Looks like they tried to get back to more realistic pricing, at $259/mo:
http://www.webhostingtalk.com/showthread.php?t=1074809
Then at $209/mo:
http://www.webhostingtalk.com/showthread.php?t=1077293
And then finally, they begin offering the $99/mo price point regularly, but still with $299 setup:
http://www.webhostingtalk.com/showthread.php?t=1089127
And finally, without the setup fee, and with 16GB in late 2011:
http://www.webhostingtalk.com/showthread.php?t=1098940
So prior to 2010, no dedicated hosting offers, so realistically they've been actively selling dedicated servers on WHT for about 4 years, first toying with low pricing 3 years ago, and fully committing to the low prices late 2011. Sounds about right for how long it would take to run out of initial capital and a few rounds of financing.
Based on the history, everyone can come to their own conclusions.ASTUTE INTERNET: Advanced, customized, and scalable solutions with AS54527 Premium Performance and Canadian Optimized Network (Level3, Shaw, CogecoPeer1, GTT/Tinet),
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03-11-2014, 10:47 AM #78Web Hosting Master
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03-11-2014, 11:53 AM #79Aaron Wendel
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03-11-2014, 12:07 PM #80Web Hosting Master
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03-11-2014, 12:44 PM #81Web Hosting Guru
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I couldn't disagree more. Prices go up usually due to costs for the provider going up.
ie:
-Power/Energy costs go up, that cost is passed onto the customer
-Real estate costs go up (lease/rent/taxes), that cost is passed onto the customer
-Inflation, cant avoid this, this is also passed onto the customer. This affects all costs.
All of these increase every single year. Every major colo contract I've ever signed, has a built in minimum increase of 5% per year.
Power pricing is usually detached and can increase beyond that. Being from Ontario you should fully understand this. With the government announced planned increase of power costs of up to 30% in the near future, you can bet your colo provider will also pass that onto you.
If you pick a provider with unsustainable pricing, that's not "getting a deal" that's setting your business up to go down in flames when the provider does also. Or your business model fails when they must increase prices to real levels.
If my provider had not increased prices on me in 6 years, I would expect ~30% increase minimum when the time finally comes.
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03-11-2014, 03:07 PM #82Web Hosting Master
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Nobody is arguing cost don't go up.
So then according to you, one must never look for any deal/promotion ? It's funny because all of the sudden these $99 server promotion had become unsustainable according to some of you. Nobody had anything to say about them before this incero price hike.
I believe a lot of people had said the same about unlimited hosting being unsustainable. Guess what happened ? They are still around and not going away anytime soon.
The word "unsustainable" is pretty played out in this thread. It clearly isn't unsustainable if incero is about to survive for 6 years.
Poor planning and bad forecast is what caused a major price hike. Not because they product they sold is considered to be "unsustainable".
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03-11-2014, 03:37 PM #83Web Hosting Master
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Holy cow @lonea.
What matters is WHEN (and what the products were) they started to sell the unsustainable products and how short of a time frame they were able to last after that, not anything BEFORE HAND. @hhw 's post with all the research clearly shuts this thread down with ownage and proves the point.
Are you being this dense on purpose?Last edited by ItsChrisG; 03-11-2014 at 03:41 PM.
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03-11-2014, 04:18 PM #84Web Hosting Master
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03-11-2014, 07:19 PM #85Web Hosting Master
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That statement might have been kind of hollow though. The real question is, was he even selling dedicated servers 6 years ago? If he didn't have 100 servers until July 2011, it's doubtful he was selling any meaningful number of them back in 2008.
In any event, their low pricing levels didn't start until late 2011, so just because they didn't raise prices for 6 years didn't meant they were able to survive on the low prices for 6 years.
The reality is, dedicated hosting is a very capital intensive business. It used to be that providers could make back their capital outlay on a server in about 6 months. These days, closer to a year seems to be more the norm, which already makes cash flow tight. Providers who are doing 2 years and beyond are either dependent on investors' capital, paying significant interest on debt (lenders don't give great rates on computer hardware), or are bound to run out of money sooner or later, even if they're actually turning a profit.
People who have been around a long time will remember the companies who have failed, or those who have had financial troubles. One example that hasn't been mentioned yet is Limestone, who had a letter leak in early 2010. I'm sure there are countless others who have had issues that were never made public.ASTUTE INTERNET: Advanced, customized, and scalable solutions with AS54527 Premium Performance and Canadian Optimized Network (Level3, Shaw, CogecoPeer1, GTT/Tinet),
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03-11-2014, 07:27 PM #86Problem Solver
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Last edited by Steven; 03-11-2014 at 07:35 PM.
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03-11-2014, 07:34 PM #87Problem Solver
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To back the ~100 dedicated servers in 2011 as displayed above:
http://web.archive.org/web/201107060...om/blog/about/
Incero hosts a large portion of the Internet's top 10,000 busiest websites sites, and I am deeply involved in the company, interfacing with customers daily, and leveraging my hardware and software experience to provide complete scalable solutions to our clients. As of early 2011 Incero has experienced rapid growth, owns over 70 dedicated serversLast edited by Steven; 03-11-2014 at 07:40 PM.
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03-11-2014, 07:46 PM #88Problem Solver
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Its also important to note that they have gotten all of their archive.org results removed. We had discussed this a couple months back in a chatroom and now its not available on the archive.org site.
In 2010 they had claimed: "Industry-leading network bandwidth capacity: 120+ gigabits/second"
For reference the archive.org link 'was': http://web.archive.org/web/201009270...ro.com/hosting
We did some more digging on the history of incero:
Incero used to be a car thing in the UK (link dead because it was removed):
http://web.archive.org/web/200304011...n/homepage.asp
EDIT: Found: http://web.archive.bibalex.org/web/2...ww.incero.com/
Which was created by gordonswebpages.com:
http://web.archive.org/web/200409220...swebpages.com/
Which is indeed owned by incero: http://whois.domaintools.com/gordonswebpages.com
Thats all I was able to get from my chat logs.
Sadly, incero wanted to hide its history I guess and got them hidden. Maybe someone else can be more lucky and find remnants of this.Last edited by Steven; 03-11-2014 at 07:54 PM.
Steven Ciaburri | Industry's Best Server Management - Rack911.com
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03-11-2014, 08:28 PM #89Aspiring Evangelist
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Here is a graph showing Incero's offers from 2010 to 2012 on WHT:
http://i.imgur.com/lbzSF6S.png
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03-11-2014, 08:57 PM #90Problem Solver
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In another thread they said Gordon attributed part of the increase to bandwidth costs. Well that is true:
http://www.webhostingtalk.com/showpo...4&postcount=17
If the market as a whole goes up with bandwidth pricing, we will still be aggressively priced compared to other solutions providersSteven Ciaburri | Industry's Best Server Management - Rack911.com
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03-11-2014, 10:57 PM #91Aspiring Evangelist
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Steven, what is your beef with Gordon? You always seem to try to fuel the fire against Gordon and his business. Just my opinion, but it puts you in an unflattering light. People in glass houses.
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03-11-2014, 11:12 PM #92Newbie
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I am another victim who fell in ******** make a payment that is in the setup to upgrade the server and keep the base price offered by Incero a few months.
I spent about $ 600 in setup, to keep the server by 121 dollars monthly. Then four months later they change ... result: if I had not paid setup would have saved about $ 300.
2 months ago they had promoting server for $ 99.
So clearly acted in bad faith.
I'm part of it will jump ship. It gives fear the next increase.
And then by the time they launch discounts to attract other Muggles? those who are loyal to the company get discounts?
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03-12-2014, 01:51 AM #93Coder :)
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03-12-2014, 03:15 AM #94Coder :)
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That is BS. Datacenter costs do NOT go up... for me, they've consistently gone down! Next year I will lose another $980/mo when a fiber build cost is up (instant profit? Or bonus dinner with a couple premium clients: I'm sure I'll find a way to spend that money =] )... As businesses evolve they get more efficient, any business that gets more gluttonous is just doing it wrong: plain and simple! And... They're greedy I understand why you have to argue your point, but get some ethics or shut up.
Oh wow... stopped reading after your first little bit of garbage but just revisited the post: did you just say the only people that were complaining were unrealistic consumers?
Dude, you're just greedy. Get over yourself. I'm not a consumer, I'm an ASP and ISP. And from the history of my account, you can see I've been at this for a bit (I've been at it longer than I've had this account) I create stuff like this for the fun of it but with principles because not everybody is in it for the money (which explains why I never get huge, I am never trying to get rich, just be happy and comfortable and do the same for those I work with)... Some people aren't trying to clean out everybody they see (you're thinking capitalists and public companies: where they are bound by their guiding principles to greed): some people realize that if they want more money, they shouldn't gouge each prospective lead for as much as possible but just do something greater Far easier that way... ...
Some have just been doing it for so long they've built up a little portfolio of projects around the world and just create whatever they feel sitting at their desk at home (which happens to be in Vancouver but could quite easily be anywhere in the world as few places have a cost of living as high as Vancouver [we have an apartment in our home country too; far cheaper cost of living, but nah, faster internet here in Vancouver w/2x 50/10 UnmeteredDSL] and I work on a computer [Apple MBPr15 2.7/16/768]) because they have support associates in branches across multiple cities that will fulfill his requests conveniently... I don't work for money, no interest in that dirty stuff: my upstream providers unfortunately want it so I charge (I would pay for it out of my projects' margins but I'm brown which makes me cheap on a level most westerners wouldn't understand: well, Russell Peters did enlighten you guys a tad) what it takes to have all my links stay up because my other living expenses are already covered and then some before I begin... compounded with all core equipment costs being null because I'll pay for that myself out of my own money/slush fund (remember, I think money is dirty, my rule system is weird that way: I donate to good causes to the point where I think I'll take the time to make a site to give away free long-term nice infrastructure to social causes)... heh Not everybody is in that boat: some businesses decide to go to the bank and get loans and lines of credit far exceeding what they could reasonably manage... While others have debt they pay off every month and then some (cuz they know they're going to be spent again; and travelling on points is da b0mb; too cheap for private jets )...
I've actually found that a good percentage of greedy people are victims of such a state by their habits: all self-induced none-the-less... I wasn't all that bright when I was 16 with AdMediaServer.net making ~$40k-$120k/mo for ~3 years all to myself brokering ad campaigns, after destroying everying in my life and having to rebuild it bit by bit I learned that there are no shortcuts... amongst other things... I'm grateful for losing so much that I never deserved... It taught me so much more than I lost, because I'm still alive
Public company: they have Wall Street to answer to... It isn't their choice, because if they refuse, Wall Street sends in a new CEO. In Canada, the same happens, but is only possible by the CRTC (not companies) for basic services.
CGotzmann, you're the type of greedy prick that makes people not want to come here... We already know the BS garbage the 'industry' would like us to believe about how tough it is: but I operate in multiple sectors (not just hosting) and there is shadiness/insider/gouging/profiteering in all of them and it WILL ALL COME TO AN END ONE DAY, why not today? Whoever figures out how to do it properly will be remembered by history
Btw... I'm pretty sureLast edited by netdude; 03-12-2014 at 03:30 AM.
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03-12-2014, 04:32 AM #95Web Hosting Master
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You have no interest in making money, but want to start a business.
Ok - thanks for the hilarious read. You enjoy your bedroom/office.
You at one point did care about making $ (as u stated above), but you messed up and lost it all and now have a condescending outlook to those who have $. Sounds like a "you" problem, not anyone else's fault.Last edited by ItsChrisG; 03-12-2014 at 04:40 AM.
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03-12-2014, 05:00 AM #96Coder :)
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Just because I don't want money doesn't mean I'm stupid enough to think I can sit around all day and do nothing and still be happy... Want to start a business? I own many around the world and run a few with friends here (and write code): just something to do, or more importantly, something to do for others consistently... I never said I don't have money (it's a waste byproduct of doing anything productive), I don't even have a problem with people that do have $ (every friend I have in Vancouver either owns or rents a $1m+ house here in Vancouver if not also multi-national individuals themselves: I've simply repurposed my life from serving myself [aka greed] to solving problems I come across [the biggest one I am trying to figure out being greed]; every friend I have abroad is 8 figures and up What can I say, I don't have many friends )... Because the reality is: for every two steps forward that compassionate people progress society, a greedy prick drags society a step back! I'm tired of the dead weight... But what can I do? workin' on it... ... ...
The problem I have is with those who make it in 'not nice ways' like bait-and-switch or using sex to sell non sexual products: the sleazy sales tactics that one would expect out of a hobo on skid row not a professional company... Because if I could do that... oooo $$$$... But I can't, instead, I have to compete against (mostly [exclusively? don't think so] American) companies that do... The worst violators of all being those commanded by Wall Street and their multi-dimensional fine-printed agreements that offer consumers little-to-no recourse to vendor totalitarianism...
Last edited by netdude; 03-12-2014 at 05:07 AM.
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03-12-2014, 01:17 PM #97Hello World
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So someone somewhere will be footing the bill for the fact your costs are not going up most likely your providers taking a hit. Maybe in a 3rd world country the costs are dropping but in real terms costs are only going one way and thats up even if you've got a "2 Megawatt" deal with the local energy company you'll still notice an increase on staffing unless of course your employees are happy to take a decrease in wage each year? Taxes and insurance policys are only going one way and that's up. Infact most of the services/products a datacenter needs to operate is going up including battery cells for the UPS systems.
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03-12-2014, 01:34 PM #98Location = SoapBox
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this is a really interesting thread...
the issue of course is what drives purchasing decisions by customers. unfortunately, "the masses" tend to get a spec sheet from a low priced provider and ask other providers to match or beat that offer. As long as customers are buying purely on price, it sort of creates this sort of business behaviour.
The businesses which operate the way you want them to, wouldnt have got your business. Its just the way it is.
There is no value in things like hardware raid, because it raises the pricing - then when you lose your data, the hosting company is at fault. you have no interest in redundant power, until of course, power goes down and you lose service and maybe even lose your data as a result.
of course the flip side to this is, customers dont always understand the intricacies of the business and feel they are spending too much when they dont have to. Providers take advantage of this, and offer really low entry points to attract customers, and then make add-ons really expensive, adjust pricing to get longer term profitability and around we go
The best advise I have for you is to seek out the long term, value based providers. Providers like this look for the serious customer. The customers who have been around the block and understand and appreciate value. Customers who understand the extra $x/month is actually really good value, and not an overpayment or overpriced.
audisat (And others) - I completely understand your frustration and your confusion. In essence, both sides of the debate in this thread are correct. The customer is right to feel like they are being taken, and the provider is within their rights to target the masses based on a pricing and contract model. Consider it a learning experience and in the future, try to consider what you are buying and what its actually worth. If the offer is "too good to be true", then it is. If you do get such an offer, try to get a contract assigned with it (ie annual) - and at least at the end of that contract, if they decide to change your pricing, you can decide if there is value in staying or leavingwww.cartika.com
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03-12-2014, 04:55 PM #99Web Hosting Guru
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I don't know why people are so surprised to see price increases like this. This don't happen only in the webhosting market. It happens each week at the fuel/gas station, from times to times at your electricity bill, etc.
In order to get a fixed price term, you need to sign a subscription for 1 or 2 years (or more). This way, you now that you will always pay the same monthly fee for the duration of this agreement.
You can't expect to have the same monthly fee after the period of the subscription if the costs for the provider increased in the meanwhile.
If the costs turn to be higher than the profit, you will not be profitable as a customer for that provider.
The problem here is the notice. For a monthly subscription, i would expect the provider to notify you 2 or 3 months before the end of the subscription.
Anyway, if they really needed to update their prices right away, it's better for them to do this late than never and disappear from the map, like already happened multiple times with other providers.
Also, for those who don't want to sign a agreement or pay a year in advance, i suggest them to have a backup/refuge plan.█ WebTuga Hosting - Portuguese Shared, Virtual and Dedicated Web Hosting
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03-12-2014, 05:40 PM #100Web Hosting Guru
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I haven't read this whole thread (read some of the other), but from where I was sitting, the price hike was fine... the fact that it came w/o warning wasn't.... blanket increase, so people a day or two from the next month, get hit with the huge invoice w/ essentially no time to relocate if that's what they decide to do... but pretty sure those issues are being handled on a case by case basis?
I've used hetzner's robot a few times to get a server to store some stuff on temporarily. If it's business hours in Germany, they'll be provisioned within a couple hours.. weekend, you can always get some 24-48 hr instance at amazon ec2
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