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  1. #1
    Join Date
    Feb 2003
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    316

    * Business Model: Cloud Hosting Vs. Traditional Hosting?

    Hi, I am going to sound like a newbie in the hosting experts forum like this one. But I hope there's some place here for newbie questions like mine. From investment and revenues point of view, I'd like to know your opinion about launching a hosting business purely based on a cloud hosting infrastructure vs. traditional and old infrastructure. For example, if I have an investment of 10,000$ and I plan to generate revenues of $2,000 per month to make a minimum 20% (i.e. $2,000) monthly. What would be the best business model for me to follow? As per traditional and old hosting model, I can grab 100 servers (costing me 100$ per month) and sell 2,000 accounts (with revenues of 10$ per month each). How will this be different in cloud hosting business model?

  2. #2
    Join Date
    May 2007
    Posts
    451
    Hello,

    10,000 dollars is not much, you can start one pretty easily. But SAN's unit is going to be your hardest part. with that being said. You may want to look at Applogic. I say this because It allows you to take BASIC servers, and does not require a SAN's unit. It uses the space inside of each of the servers to store your volumes. If your very resourceful you can pick up good equipment maybe a generation or two back for very inexpensive.

    www.3tera.net

    Take a look at it.

    Thanks,
    Michael Wallace - michael@innoscale.net
    Innovative Scaling Technologies Inc. - A Cloud Service Provider
    24/7 Support, Call us @ 1-307-200-4880
    www.innoscale.net - Seattle, Silicon Valley, Dallas, Chicago, Washington D.C., and Europe

  3. #3
    I did not find any pricing information for Applogic on their site, do you have more information?

  4. #4
    Join Date
    Oct 2006
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    US/EU/UK
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    Hi Amir,

    I think that you should decide what do you want to do? Paying $100 for a dedicated server is not something you need to provide any kind of hosting services. You need powerful 2 x CPU or even multi processors server system with RAID 10, hard drives as big and as fast as you can use (the choice usually is between big SATA and fast, but smaller SAS2). One like this costs thousands of dollars.

    It is probably a better idea to start with a VPS account hosted on any kind of Cloud computing powered infrastructure and to get another one for archive back-up.
    HostColor.com Edge Infrastructure - US Dedicated Servers & Europe Dedicated Hostingsince 2000
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  5. #5
    Join Date
    Mar 2004
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    Cheshire, UK & WA, USA
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    CoolMike,

    For pricing info you can contact their Sales department and they'll be able to provide details for you.

    Hostcolor,

    Throwing money at hardware isn't a great way to build a hosting company. As long as you have a good business plan and solid hardware you can make anything work.
    Old School Web Hoster
    138Media LTD (Media and Consulting)

  6. #6
    Join Date
    Jun 2005
    Location
    European Union
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    391
    Quote Originally Posted by Latic View Post
    CoolMike,

    For pricing info you can contact their Sales department and they'll be able to provide details for you.

    Hostcolor,

    Throwing money at hardware isn't a great way to build a hosting company. As long as you have a good business plan and solid hardware you can make anything work.
    And the expertise to manage it Cloud isn't easy!
    EuroVPS - Europe's Fully Managed Hosting
    Established 2004 - The European Hosting Authority

  7. #7
    Join Date
    Mar 2004
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    Cheshire, UK & WA, USA
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    Eurovps,

    Agreed (i was including this in a good business plan)
    Old School Web Hoster
    138Media LTD (Media and Consulting)

  8. #8
    Join Date
    Aug 2003
    Location
    East Coast
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    Additionally your not going to just stick $10k in the hosting market and sit back to enjoy your $2k/mo profit.

  9. #9
    With a small investment like that, I'd go with a traditional server colocated. Pick up a nice $4-5k server and colo it.

    Spend as little as possible on infrastructure unless you have alot more than 10k. Marketing is where the real money comes in.

  10. #10
    Quote Originally Posted by SamBarrow View Post
    Marketing is where the real money comes in.
    Exactly. I can understand the appeal of wanting to build a top of the line Cloud network but its practically purposeless if its going to be vacant / inactive for months at a time simply because your entire budget was used in the development of the Cloud itself.
    [ IncogNET LLC ] Privacy By Design [Liberty Lake, WA][Kansas City, MO][Allentown, PA][Naaldwijk, NL]
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  11. #11
    Join Date
    Jun 2005
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    European Union
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    Real marketing happens behind closed doors. Without a polished product, all you have are smoke and mirrors.
    EuroVPS - Europe's Fully Managed Hosting
    Established 2004 - The European Hosting Authority

  12. #12
    Join Date
    Jun 2008
    Location
    San Diego, CA
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    Agreeed. We have found that top-notch support is what brings customers in long-term, and KEEPS them.
    Brent Presley - brent@innoscale.net
    Innovative Scaling Technologies Inc. - Enterprise Cloud Hosting and Support
    24/7 Dedicated Support, Call us @ 1-888-722-8515
    www.innoscale.net - Ashburn - Dallas - Seattle - Santa Clara - Chicago - Amsterdam

  13. #13
    Join Date
    Jan 2011
    Location
    Ohio
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    I'd be interested in knowing how much some of you have invested if you think 10k is small. This is hosting remember. He/She never said they would be hosting the next eBay, Amazon, Wal-Mart, or anything like that. Don't you all know of the old days using 600mhz 20gb hd, 512mb ram to host 30 or so personal websites?

    I would bet my left nut that 70% of you havent invested anymore then 10k in hardware.

    Afterall, linux was not primarily created for 30,000 setups... Do you really think these software makers spend anything like that? Yeah right. If you hit the big money sure.. With a country in debt trillions, and almost 9% unemployment I highly doubt it.

  14. #14
    Join Date
    Jun 2008
    Location
    San Diego, CA
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    For cloud, 100k is a good starting point. We have invested far far north of that number in our infrastructure.
    Brent Presley - brent@innoscale.net
    Innovative Scaling Technologies Inc. - Enterprise Cloud Hosting and Support
    24/7 Dedicated Support, Call us @ 1-888-722-8515
    www.innoscale.net - Ashburn - Dallas - Seattle - Santa Clara - Chicago - Amsterdam

  15. #15
    Join Date
    Jan 2004
    Posts
    593
    Quote Originally Posted by bluemer View Post
    I'd be interested in knowing how much some of you have invested if you think 10k is small. This is hosting remember. He/She never said they would be hosting the next eBay, Amazon, Wal-Mart, or anything like that. Don't you all know of the old days using 600mhz 20gb hd, 512mb ram to host 30 or so personal websites?

    I would bet my left nut that 70% of you havent invested anymore then 10k in hardware.

    Afterall, linux was not primarily created for 30,000 setups... Do you really think these software makers spend anything like that? Yeah right. If you hit the big money sure.. With a country in debt trillions, and almost 9% unemployment I highly doubt it.
    I agree with you on this. I started back in 2003 with $30. Bought a domain and a reseller account. Grew from there.

    However, cloud is different. You must invest in the hardware and potential licensing like onapp. Technically you only need a small number of servers to be considered a cloud. So if you went the renting servers way then you could tie them together with internal bandwidth. Downside to this is that a cloud would work best in its own rack and not have servers spread across the dc. That way you keep them on their own private switch.

  16. #16
    Join Date
    Jan 2011
    Location
    New Jersey
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    Seriously..Raid 10 ??

    Quote Originally Posted by HostColor View Post
    Hi Amir,

    I think that you should decide what do you want to do? Paying $100 for a dedicated server is not something you need to provide any kind of hosting services. You need powerful 2 x CPU or even multi processors server system with RAID 10, hard drives as big and as fast as you can use (the choice usually is between big SATA and fast, but smaller SAS2). One like this costs thousands of dollars.

    It is probably a better idea to start with a VPS account hosted on any kind of Cloud computing powered infrastructure and to get another one for archive back-up.
    I was just wondering why you felt RAID 10 was necessary, it sound like overkill to me?

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