I am planning to start a Game Server Company with a friend of mine and I have a few questions and would like to hear your opinions before I officially start.
Before I ask my questions, here's my background. I am 17 years old and have been playing video games, mainly Half - Life and Half - Life mods, for the past 3 - 4 years. I have read many posts regarding new Game Server Companies being headed by 16 - 20 year olds who aren't really prepared. So, here's my little resume. I was a founder a webmaster of a very popular Day of Defeat Custom Site, which was the number one or one of the top ten Day of Defeat websites in the world. While working on that website, I gained alot of experience that could be used for when I start the company. Such as, maintaining and updating a website every other day and helping people installing skins/sounds/sprites, which wasn't so easy since most of them didn't know where to and how to unzip files. I have read many threads concerning starting a Game Server Company and one of the common complaints were dealing with people who aren't so familiar with adminmod/FTP/etc, so I'm hoping I'll be able to manage. I have roughly 3 - 4 months experience as a Custom Support Technician for a Game Server Company, so I'm familar with the Live Chat/Ticket system programs and I gained alot of experience dealing with customers similar to ones I'll eventually be dealing with. I also had the opportunity to learn how to set up, maintainin, and tweak Game Servers when a friend of mine, the same who is going to be my partner in the company, gave me remote access to his computer in which he hosted a few servers which I set up and maintained. I believe thats where I gained most of my knowlegde and experience regarding servers. This is most of the experience I have which I hope will aid me when I start the company.
The main factor that convinced me to start the company is that my friend/partner has access to a T1 connection, soon to be OC3, where we previously setup a few Counter - Strike and Day of Defeat servers which were very popular. So, we wouldn't have to pay for the connection and simply for the hardware and software. We are planning to host only Half - Life and Half - Life mods and Ventrilo servers at the beginning, but if the company is a success we plan to expand to Battlefield 1942, Call of Duty, etc. We have already decided on the name of the company, found a web template, decided the final prices, what Customer Support System we will use (Live Chat/Ticket System/E - Mail), and what software we plan will use, etc. I am only awaiting for my partner to register the domain and send the money for the template and then we can start getting the website up and running and advertising. We plan to use the first few months profit to pay off all the expenses spend on the software, hardware, etc.
Since my friend also works in RL, I'll be setting up the servers, dealing with customers, etc. I'll also do have to deal with school and I am concerned whether it will take up too much of my time. My questions are:
- How many hours a day should I expect to spend working?
- How many servers does the average company host? And how much profit does one make, disregarding the cost spent on paying for the connection/hardware?
- Are there any legal issues I should be concerned with before I officially start? I asked my partner this, because I wasn't sure and he said that the only things we would need, regarding legal issues, are a Terms of Service.
- In the end, is it really worth all the time and money spent to start up the company? For me, being a student, any money I make at this point would be good enough and me and my partner agreed to that I will receive the greater part of the profits since I will be doing most of the work.
Well, thats the jist of it. I've been browsing these forums for the past 6 months and have learned alot and was where I first found my first small job. Well, thanks in advance for the people that read/post.
* How many hours a day should I expect to spend working?
18+ hours a day 7 days a week. 24 if you offer 24/7 support !
* How many servers does the average company host?
no such thing as an average company, some have none, lots have 1 many have thousands.
* And how much profit does one make, disregarding the cost spent on paying for the connection/hardware?
many hosts make nothing and lose money, several hosts gop bankrupt every day
* Are there any legal issues I should be concerned with before I officially start?
LOTS you need to speak to a local lawyer as rules/laws vary between countries/provinces etc.
Bear in mind that in most places under 18 is not old enough to sign contracts, therefore anything you do as a "business" is not legally binding. A "company" is not something you do between homework and driving lessons !
Your target marketplace has the highest rate of fraud and failiures of any part of the hosting arena, and with *possibly* the most demanding clientbase due to immaturity and dos attacks etc ...
* is it really worth all the time and money spent to start up the company?
what do *you* think, what does your business plan say, how committed are you to making it work, how much help/support/finance are your parents able to contribute, where will the additional staff you'll need come from - if you have answer to even half of those questins, then probably yes, it's worth it ..
* any money I make at this point would be
still taxable and have to be declared
* thanks in advance for the people that read/post.
In all seriousness ...
Draw up a business plan, look at *all* the costs involved
Plan for when you outgrow your line and have to strat renting space @ a DC
Always treat it like a real business, look after the cutsomers, charge a sensible price and provide a good service
First opionon, a T1 isnt nowhere near enough b/w to have a sucessful gameserver company.. Adding an OC3 would give you much more breathing room, but depending on how large you get, you will STILL need more..
A typical Counterstike server (pub, 16 players) can use between 32-45k/sec when full, a T1 MAX can handle 192k/sec, but by then you will notice a great increase of latency etc... I have run cstrike servers from our T1 here, worked great until the load on the T got above 60%, then we noticed some higher pings..
Granted, I was running it for me and a few co-workers, never intended to make a business out of it.
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Reguardless of connection speed and all that silly stuff....
The only way to make money in the game hosting world is if you have a decent ammount of customers. Now, like mentioned earlier, your customers in the game server world will be about twice as hard to deal with(because of age, parents etc). And lastly, there is alot of competition out there, who are established and making money.
All and all, it will be a big risk....think it over
Game Server hosting is a shaky/unstable business... You got people cancelling all the time for various reasons....
Imagine, you have 14 people whos due dates/bill dates are on the 1st of the month, but only 4 people actually stay. That's painful. That's 10 servers you have to *take down* and suspend/disable because those bills were not paid. That's a lot of $$$ you just lost that you need to make up for, if you can even do that.
People cancel all the time for reasons such as:
- can't afford it
- clan/team broke up
- got bored of the game
- service wasn't up to par
- found a better deal
- friend bought a server now so no need to pay for one anymore
- got grounded
- mom won't pay for it anymore
- clan mates were suppose to pitch in to pay for the server but now they backed out and won't pay
- the list goes on and on
not to mention all the little kids you are going to be dealing with
it is very hard to survive in the game server hosting business
it isnt anything great, lets put it that way. i am speaking from first hand experience.
I would go with one server at a time. Re-invest the money once you have enough for the next server. You should start building something around the servers itself. A thriving community will help to attract new customers. You could place ads on the forum to make some additional and to not depend only on the income from the servers.
I can also say from first hand experiance that the game servers are alot of hard work and the kit and connections has to be spot on.
Profit........ whats that ?
As said before customers come and go very quickly it has taken us 2 years nearly to build up a solid customer base and on top of that we have the "here one month gone the next" customers these create alot of work and are moving on to the "NEXT DEAL" as soon as they can.
We have recently dipped our toe in to the hosting market and have found that customers are alot older and more reliable and that from the same spec machines we have for the game servers can earn up to 10 times more per month doing web hosting.
Do alot of research, you will need alot of bandwidth and good connections to your servers, you will lose customers very quickly if they start to experiance lag at peak times etc, we have invested £10,000's of pounds in our kit over the last two years and have seen little return so far.