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  1. #1
    Join Date
    Jan 2001
    Location
    Kihei, HI
    Posts
    576

    CPanel Dedicated Server market a lost cause?

    I wonder, is there any way to make a profit, or even get a foothold in the CPanel Dedicated Server market? Running the numbers, I just don't see it. And I'm not prepared to sell a product and support it 24/7 if I can't make at least a reasonable profit.

    We're a CPanel Partner NOC, and a small one, meaning less than 100 servers, so we pay $42.50 per server per month for CPanel. To think we went through the trouble of becoming a Partner NOC for that price, seems kind of foolish now. Almost every DC of some size sells CPanel retail for less than that! Still, its a good selling point to be a Partner NOC, I suppose.

    Then you've got the price of hardware. We don't sell junk machines, and we won't build anything without RAID anymore. So, minimum you're looking at $550 for our low end boxes.

    Then you've got to pay for bandwidth, which isn't really that expensive, but its a fixed cost. Oh yes, and there are employees to pay too.

    Bottom line is, a small company like mine that doesn't live off a corporate credit line, and pays bills with cash, simply can't afford to sell servers at $99 or even $149 per month.

    Looking at the pricing in the market, you've got RS of course, Nocster and countless others. They all are offering CPanel servers for less than $125/month.

    What I've seen is, folks shopping for servers don't give a crap about support or the quality of the parts you put in, they care about price, price and price. Case in point, when RS started offering CPanel servers, we lost a bunch of dedicated clients the first month. Never mind that they had 100% uptime, and support there when they needed it. They saw they could save some bucks and left. Can I blame them? No. Not at all.

    Its not really a problem for our business, since shared hosting is a far more proftable business for us, but I wonder how anyone can compete in a market like that? Just this morning I saw Nocster starting to sell servers for less than $70/month with CPanel installed. Is it a desperation move against RS? Maybe. But, there is no way in hell we can compete with that.

    How are other companies faring now selling CPanel servers? Are we the only ones seeing the landscape shift? At this point, I'm considering only selling custom servers on request...

    Take care,

    Brian
    :: 1StopWebHosting.com :: - Professional Web Hosting Services
    ::
    :: Featuring the CPanel Control Panel running on CENTOS Linux servers
    :: We offer Shared Web Hosting, Business Hosting, Java / J2EE Servers and Dedicated Server solutions.

  2. #2
    This is a tough call. Maybe its best to become a reseller for these companies?
    Hockey is Life

  3. #3
    Join Date
    Sep 2002
    Location
    Oklahoma
    Posts
    825
    Cpanel sucks anyways. Be different and don't sell it, use a different control panel or code your own. I agree with you totally on the numbers not adding up and how ludicris companies like nocster, dnow and rackshack make it hard for people to earn a decent living, but I guess that's life.
    Devon Dunham (Owner, Sharpnet/DDoS Host)
    Advanced DDoS Mitigation and Server Management Solutions

    Protecting your online infrastructure.

    Est. 1998.

  4. #4
    Maybe try to market other places then WHT? most of the people that go for the cheap deals are mainly residents from this board - the hardware / support may seem insignificant here but is noted by actual professionals who need them as they will be with you for the long run unlike most of the people that do go for the $99 servers and try to make $1000 from it in the one month

    I agree with the CPanel tho Nocster + DNow can offer it @ $9.95 - it may seem cheaper to actually develop a similar control panel and put that on the servers for free / small sum.

  5. #5
    Join Date
    Jun 2003
    Posts
    477
    Originally posted by DD-SNC
    Cpanel sucks anyways.
    That's just an opinion...

    So, back on topic. I sell cPanel enabled dedicated servers and after accounting for the server, the license, rack, power etc there isn't much profit at all. The main reason I do it is because I enjoy it.
    http://www.webhostingtalk.com/search.php?s=
    Don't just ask point blank questions, search first.

  6. #6
    Join Date
    Jan 2001
    Location
    Kihei, HI
    Posts
    576
    Originally posted by Manu
    Maybe try to market other places then WHT? ....
    Actually, we don't try to Market at WHT. Its not worth the time, as there is way to much competition to even get noticed. There was a time it was worth it, but not now, with everyone here giving away shared and dedicated hosting.

    So, back on topic. I sell cPanel enabled dedicated servers and after accounting for the server, the license, rack, power etc there isn't much profit at all. The main reason I do it is because I enjoy it.
    I enjoy it too, but I enjoy making a decent wage and being able to pay my bills more. :-)

    I guess the point of my initial posting was to vent some frustration. I almost feel like the mom and pop store fighting against a corporate giant. In a market where price is everything, there is no way to compete.

    I think differentiation is the key. And, we do offer some things different than the usual CPanel server distributor, like RAID, PostgreSQL, SquirelMail, etc.

    I think there is becoming an expectation in the market that you should pay no more than $100 per month for a server. Rackshack started it and other companies followed suit, and now it seems that is the price everyone trys to shoot for.

    So, how do you convince someone good hardware, networking and support is worth more? I guess that is what I'm missing...

    Take care,

    Brian
    :: 1StopWebHosting.com :: - Professional Web Hosting Services
    ::
    :: Featuring the CPanel Control Panel running on CENTOS Linux servers
    :: We offer Shared Web Hosting, Business Hosting, Java / J2EE Servers and Dedicated Server solutions.

  7. #7
    Join Date
    Apr 2003
    Location
    Houston, TX
    Posts
    137
    you've just got a different customer base

    go for big corporate customers instead of small customers just looking at price

    look at rackspace
    Nathan Yap
    NyCorp.Net Web Hosting
    www.nycorp.net
    sales@nycorp.net

  8. #8
    Join Date
    Aug 2002
    Location
    Trouble will find me!
    Posts
    1,470
    If you base your business around selling and advertising on WHT then god help you..

    Look local, good service and spread your name with word of mouth... Good luck.

    -Shazad
    ^^ IM WITH STUPID!! ^^

    "The only way to overcome fear, is to challenge it head on"
    "The quickest way to get over a woman, is to get under another"

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