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  1. #1
    Join Date
    Sep 2008
    Chicago, Illinois

    Killing The Hosting market

    I just seen some of the European hosting companies are offering very low cost Servers . Under $ 30

    They are killing the hosting market. What do you think about that ?

  2. #2
    Join Date
    Mar 2003
    That is normal for cheap service :-)
    Specially 4 You
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  3. #3
    Join Date
    Jul 2011
    Quote Originally Posted by ALEXEI_M View Post
    I just seen some of the European hosting companies are offering very low cost Servers . Under $ 30

    They are killing the hosting market. What do you think about that ?
    Exactly now there competition between companies, they offer 9 Eu servers as well..
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  4. #4
    I bet you they're worth under 30 USD as well.
    To assume perfection is merely a display of ignorance.

  5. #5
    Join Date
    Nov 2013

    Scale and SLA

    Its a sense that every hosting provider has a different strategy of targeting customers and growing their business
    they are going for volumes
    any drop in volumes and theyll bleed
    economies of scale is a very big factor.
    everything like b/w.electricity,hvac,human resources etc is shared except the server.which has a fixed and can be recovered.
    clients should care more for their SLAs once they are being provided these services at such a low cost.
    they are not killing the business they are creating more possibilites and making more affordable for customers

  6. #6
    Join Date
    Jan 2003
    Cheap servers are their own market. Some will use them some won't.
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  7. #7
    Yeah, cheap servers and sh*t support. That's the "path to success".

  8. #8
    Join Date
    Apr 2013
    Middletown, USA
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  9. #9


    Quote Originally Posted by ServerSub View Post
    Free cheese can only be found in a mouse trap! it is same
    Good one !

  10. #10
    Join Date
    Jun 2010
    Each market have their own share
    No need to worry about it, as long as we can give premium services for our customers.

    Not all user know how to manage dedicated server from dedibox/digicube, if that what you mean, many user might choose a ready to go, rather than the unmanaged server.

    But, for a highend provider like liquidweb and linode or rackspace, they will still getting customers aren't they?

    So, no need to worry - my personal homepage

  11. #11
    Join Date
    Jan 2011
    OP they are not killing hosting market.Cheap server comes with no support.
    Failure is success if we learn from it.

  12. #12
    IMO competition does not kill a market... it just makes service better.

  13. #13
    Join Date
    Jul 2009
    Customers are clever, they use cheap servers for gaming, etc and not for business purpose.

    But they are making hosting business more difficult.
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  14. #14
    Join Date
    Nov 2013
    Cheap is okay... But make sure the support and uptime are relatively okay as well!

  15. #15
    Join Date
    Apr 2013
    Data center
    I'd rather go with a free host, they are the same thing...

  16. #16
    Join Date
    Jun 2013


    Quote Originally Posted by ALEXEI_M View Post
    I just seen some of the European hosting companies are offering very low cost Servers . Under $ 30

    They are killing the hosting market. What do you think about that ?
    when that comes to support and after sale service. People often loose huge amounts.

  17. #17
    Join Date
    Oct 2005
    Surrey BC
    I use Hetnzer, OVH and Oneprovider ( reseller) for game servers. For $39 US I get an E3 server that can host several games. I really havent had any issues with them and if one fais its trivial to cancell it and get a second one going in an hour especially from OVH. So why would I pay $100 more from a more expensive proovider?

    You could say OBD 2 scanners are killing the auto shops since everyone can diagnose their own cars but in realitiy 90% of the public wont and doesn't want to.


  18. #18
    You would never know how much CPU, RAM and Bandwidth resources you can have from them but you know it is likely to be not enough.
    A healthy business shall grow together with your IT service provider so you shall pay a fair amount of money to keep them alive.
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  19. #19
    Cheap servers offers consumers to be able to use hosting at an affordable price. But its a choose wether you use it or you don't use it

  20. #20
    Join Date
    Feb 2006
    Kepler 62f
    Quote Originally Posted by digitallog View Post
    OP they are not killing hosting market.Cheap server comes with no support.
    And inferior hardware, on inferior networks.
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  21. #21
    Join Date
    Oct 2005
    Surrey BC
    Quote Originally Posted by kpmedia View Post
    And inferior hardware, on inferior networks.
    Not every DC has to cater to mission citical customers. Why would I pay $200 for a high quality E3 server which runs a game vs a $40 E3 server that does the same job and the newtowrk works just fine for gaming.


  22. #22
    Quote Originally Posted by Vex76 View Post
    Yeah, cheap servers and sh*t support. That's the "path to success".
    Totally, agree! You got what you paid.

  23. #23
    Join Date
    Mar 2013
    Quote Originally Posted by Evolver View Post
    and get a second one going in an hour especially from OVH
    Not that easy anymore.

  24. #24
    Join Date
    May 2011
    If you intend to make a living or profit from your website then how much you want to pay for hosting is proportional to your your profit and size of business. Even $300 a year isn't exactly going to cut into your profits unless its just a hobby that earns a bit of money.

    If they are affecting the market then I'd guess it might be streamlining / filtering it for the more expensive hosts by attracting businesses seeking it cheap which could be indicative of how they are a business that might fail in general. I've no idea.

    The support of my non-cheap frills webhost has been important and saved me hassle.

  25. #25
    Join Date
    Feb 2013
    The support worth much than a $9 server. Why buying a server, a cheap server if the support does not exist or charge $50 for reboot .

    Cheap and good are not equal on hosting business

  26. #26
    Join Date
    Jan 2012
    London, UK
    You Get What You Pay For.

  27. #27
    Join Date
    Jan 2011
    Yes you are right you get what you pay for but technology is advancing so prices should be lowered and services should be good.
    Failure is success if we learn from it.

  28. #28
    Thats possible because

    1) They're selling "Root"-Server this isnt a dedicated Server.
    2) They're mostly in a DC without UPS and a good Clima, no double Floor. Just cooling with Air. Sometimes Power Disconnect...
    3) Just the cheapest Hardware and Network.
    4) Staff they dont know what is todo. Bad SLA Times.
    5) If you pay peanuts you get Monkeys.
    Last edited by arpa; 02-27-2014 at 02:42 AM. Reason: edit: sry for diggin out old thread ...

  29. #29
    That is the nature of business. If you do not adapt with the times, you go out of business. Like someone has rightly pointed out in this thread, hosting is a game of scale. Like any other business it carries a fair amount of risk. In an ideal world we would want the client to pay the full amount that we pay to the datacenter + a reasonable profit(Dedicated). We observed that the client hardly uses 1-5% of the resources so our brilliant sales minds(cough cough.... innovation) had an idea to break up the server (shared hosting) to make it cheaper and more affordable on the presumption that the money made from sum of parts will be more than selling a single part. By the original poster's logic this (shared hosting)is what killed the industry. Hosting as an industry is changing. The very reason that we have technologies like virtualization (VPS's) that break down the server into multiple smaller parts is to make it affordable and to be able to sell more. The key is always to get the balance right. This being an unregulated industry there will always be price disparity. We as web hosting providers have to carve our niche. There will ALWAYS be someone who "thinks" he can sell more for a $ less and still end up making more money.

  30. #30
    Quote Originally Posted by digitaltechnocrat View Post
    That is the nature of business. If you do not adapt with the times, you go out of business.
    Nothing against you, but every Project i saw, they moved to India because it's cheaper was more as Pain in the Ass and more expensive at the end, more as you can except.

    Workflow like this:

    1) User Reports Bug
    2) QS test the Bug and opens an Ticket with full Description.
    3) QS send it to India
    4) Indian starts working after lot of Questions (I dont understand this, and these please repeat)
    5) Indian sends back
    6) QS starts testing
    7) QS found again an Bug and have to translate again all kind and send it back to India.

    With an local Contractor its faster done, you save time and money. But its cooler to say "look i have a Project with 250 People" then "look i have a Project with 100 People".

    Thats the biggest Problem on our whole society: CHEAPER CHEAPER CHEAPER!!! NO COSTS!!!

  31. #31
    Yeah, cheap servers ok but make sure the uptime and provide the good support

  32. #32
    Join Date
    Dec 2012
    Don't worry about it, I have resold EU servers and still do sell them with management, plenty of people are happy to pay more and not cheap rates at that.

    People don't always want no support servers, add the extra services. It isn't killing the market, just helping to make it profitable for others

  33. #33
    Some new companies and startups will start with very low pricing to get business going and to grow a customer base. Then slowly change pricing...
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  34. #34
    Price isn't everything. Resources might get oversold and customers might be in for a rude awakening when they need support.

  35. #35
    Join Date
    Jun 2005
    They are just killing themselves or the loans they took.

    Most of these companies are heavily in debt, they don´t last long if they don´t recoup the prices. Their strategy is to try to nickel and dime customers with extras/addons.

    You don´t expect them to really make a profit with this prices, in particular in Europe where energy is expensive, each server consumes power+bandwidth, and servers eat power 24/7.

    Their strategy is to have very cheap prices, and once you are hooked, you usually have no option but to agree to extras. Charge for reboot, hardware drive changes, OS reload, etc, once you add all of them its costs you more or less the same.

    Since their prices are very cheap they tend to have all type of hidden limits in terms of network, you can´t really speed up or consume allot of bandwidth without them suspending you for what ever reason they can think off.

    Some can actually last 1 or 2 years, once the money is gone they go bankrupt or just increase prices. Said that, that could also be a marketing trick, when they start out to get clients they undersell their servers, once they have enough customers they raise price to make up for the loss. This may or not work, since most customers leave when prices go up.

    The problem is since they are cheap they attract cheap customers, with all type of issues, malware, dos attacks, etc, so cheap ends up costing them allot more in the end in terms of support.

    And no, they are not killing the market, just like free hosting did not killed paid hosting either. Anyone knows free hosting is not serious and I would rather get a good VPS than some of this cheap servers unless its a server for development, some backup, etc, nothing serious.

    Cheap is not a problem if what they offer is very simple and thats it and it works.

    Problem is usually that cheap does not go along so fine with good services. Unless they focus on a specific market and only that, cheap usually means they are lowering their costs somewhere, and there is no magic here, just figure out where they are lowering their costs, they are taking something away that other providers have, it may be hidden but there surely is something missing since they are saving money somewhere.
    Last edited by nibb; 03-06-2014 at 05:46 PM.

  36. #36
    I believe the hosting market is evolving, as more affordable hardware is flooding the market. How providers can innovate and market their products through this period of change, will determine the course of a hosting business.

  37. #37
    Yes, that is expected.
    This is mainly because there are more demand and this high demand for hosting drives costs down.

  38. #38
    What is more worrying is how the diy platforms have evolved with "free" services covering web hosting and web design, sure those diy solutions can't ever replace the professional services in terms of quality but then the target market is different.

    Hosting companies offering services too cheap target a different market to those with higher prices, it's really the same across so many things in life, it all depends what market you are planning to target.

  39. #39
    Cheap isn't always the best, i'd go for a well known host over some cheap one any day.

  40. #40
    Join Date
    Jan 2005
    Toronto, Canada
    Hosting market is growing and will continue to grow and evolve, regardless what pricing models are out there. As Hosters we need to grow and evolve with new products offerings, and use and leverage our resources to expand. In the end, we need to make a profit.
    Now without mentioning names, how would you like to put your business in a cheap not profitable hosting company that moves in the middle of the night and then sells you as a customer to anther company a week later??? .. oh the new company raises the prices by 400% ..
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