Results 1 to 25 of 25
  1. #1
    Join Date
    Apr 2004
    Posts
    44

    Cannot bail out of hosting because of 1 yr contract

    Here is the situation:
    I've already been hosted for a year at a certain webhosting company and I just recently (last month) paid for the next year. I changed hosting companies because I didn't need all that space/bandwidth, however I couldn't get a refund because I signed up for the 1 year plan at a reduced price.

    Fine, I understand this. They said that if I cancelled the account, they can give me credit.

    I am just wondering what you all would do in my situation? And what sort of things you would allow me to do with my credit, if you are a hosting company?

    I'm thinking I could use the credit to register for domain names? or can I not do that?

    I already e-mailed the company for options and they seem to be really slow at replying to my e-mails... I just want some ideas.

  2. #2
    Sorry to hear about your situation, your options are very limited by how the company you signed up with deals with these matters. I would either wait for them to reply about the credit idea or either just go through with the year of hosting but asking them to improve their service. I wish you the best of luck on this matter.

  3. #3
    Join Date
    Mar 2002
    Posts
    191
    Now you know why you should never sign up with a host for a one year contract unless you know that you actually want to stay a year. Frankly, I can't think of how this credit is going to do you any good. And I am puzzled: why whould you drop a host because it is giving you too much space/bandwidth. Did your pcokets feel too full??
    WHT--The first time in my life I have been called junior...

  4. #4
    Join Date
    Nov 2003
    Location
    Ohio
    Posts
    504
    Take the amount of money you paid, deduct the regular monthly charge for the amount of time you used after payment - then take out a slight administrative charge for 'early termination fee,' and your off on your way.

    At least, that's what I would do.

  5. #5
    Join Date
    Feb 2004
    Location
    Southern California
    Posts
    749

  6. #6
    Originally posted by cybexhost1
    Take the amount of money you paid, deduct the regular monthly charge for the amount of time you used after payment - then take out a slight administrative charge for 'early termination fee,' and your off on your way.

    At least, that's what I would do.
    BINGO...that looks about right and is pretty easy to do for any honest business person.
    SuperWebHost.com, a Digitally Justified Company
    Celebrating our 9th year in Business

    Proudly Hosting with CANADIAN bandwidth
    Managed Hosting, Multi-Domain Hosting, Colocation, Merchant Accounts

  7. #7
    PS - Of course, it does depend if they have a specific clause in their Terms of Service in regards to annual payments/early cancellations.
    SuperWebHost.com, a Digitally Justified Company
    Celebrating our 9th year in Business

    Proudly Hosting with CANADIAN bandwidth
    Managed Hosting, Multi-Domain Hosting, Colocation, Merchant Accounts

  8. #8
    Join Date
    Mar 2004
    Posts
    93
    Well I don't know about you but if your not happy with what they are offering I would do everything whithin your legal powers to get your money back with the least amount of energy expended.

    So first question, did you physicaly sign a contract. If not the other company will have a very difficult time enforcing what is not really a binding contract. Problem is they have your money. That issue is fairly easy to remedy by calling up your CreditCard company and disputing the charges.

    When you call the CC company explain that the other company is not providing the service at a level that is consistent with what you paid for and when you asked for a refund of your money back to you they refused so now you are disputing a portion of the charges.

    The CC company will then contact the hosting company, inform them of the dispute and ask them to provide either physical proof that it delivered a product to the billing address on the CC (which is irrelevent for an intangible item) or provide a copy of the signed sales receipt. Without being able to provide that you will win the dispute. The hosting company can then try to go after you legally, however if you have not physically signed a contract then there is none (checking little boxes on websites does not confirm the identity of the person participating in the transaction).

    In my opinion there should never be any reason for a hosting company to not offer you a pro-rated refund on time you have not used. Granted they might have additional fees like setup fees etc... that might have been waived for paying a year in advance that needs to be accessed but you should get something back. That to me is just an example of being greedy by the hosting company. In my opinion if a customer wants their money back, just give it to them, no use in fighting them, better to concentrate my time on getting business then trying to save a few bucks in a potentialy losing battle.

  9. #9
    Originally posted by comfixit
    The CC company will then contact the hosting company, inform them of the dispute and ask them to provide either physical proof that it delivered a product to the billing address on the CC (which is irrelevent for an intangible item) or provide a copy of the signed sales receipt. Without being able to provide that you will win the dispute. The hosting company can then try to go after you legally, however if you have not physically signed a contract then there is none (checking little boxes on websites does not confirm the identity of the person participating in the transaction).
    I'm not so sure it's as cut and dry as that. If this was his first month of signing up, fine. Call the CC company and chargeback with the protection of an unsigned physical contract. However, this is a RENEWAL after he has been with them for a year. The hosting company will have a decent defence when the CC company calls them. And if they have proof that their TOS had a clause (at time of original signup a year ago) in regards to early cancellations specifiying no refunds, the CC company will have to take notice.

    At least, this is my opinion and each chargeback case is generally handled case-by-case; however, it bugs me that people signup for services and then want to swindle their way out of it by any means possible - including chargebacks which essentially hurt the host.
    SuperWebHost.com, a Digitally Justified Company
    Celebrating our 9th year in Business

    Proudly Hosting with CANADIAN bandwidth
    Managed Hosting, Multi-Domain Hosting, Colocation, Merchant Accounts

  10. #10
    Join Date
    Jan 2003
    Location
    U.S.A.
    Posts
    3,911
    You should read their TOS and check what their policy is for refunds.

  11. #11
    Join Date
    Mar 2004
    Posts
    93
    Van Host your right it may not be as cut and dry as my statement may have appeared. But regardles I reccomend doing the maximum possible to re-aquire any money you feel your owed. And I think the most effective/least effort methodi would be to contact the CC company and see what happens. Worst thing that happens is you waste a phone call. You can't get in trouble for asking as long as your not trying to be fradulent.

  12. #12
    Originally posted by comfixit
    Van Host your right it may not be as cut and dry as my statement may have appeared. But regardles I reccomend doing the maximum possible to re-aquire any money you feel your owed. And I think the most effective/least effort methodi would be to contact the CC company and see what happens. Worst thing that happens is you waste a phone call. You can't get in trouble for asking as long as your not trying to be fradulent.
    First things first...checkt the TOS. If you call the CC company to get a refund-via-chargeback and their are clauses in their TOS that you agreed to, that is fradulent.

    Comfixit - By the way, what do you think the hosting company is owed? I have no idea what their TOS says or what their level of services, I'm just playing devil's advocate. Are they not entitled to a certain level of commitment based on annual signups? If they do have a clause stating credit only refunds, then I would say that the host is entitled to do that. However, you should be able to use that credit towards ANY service they provide. Domains, design, merchant accounts, software, etc..
    SuperWebHost.com, a Digitally Justified Company
    Celebrating our 9th year in Business

    Proudly Hosting with CANADIAN bandwidth
    Managed Hosting, Multi-Domain Hosting, Colocation, Merchant Accounts

  13. #13
    Join Date
    Apr 2004
    Location
    United Kingdom
    Posts
    375
    The problem is that businesses rely and make forecasts based on the contracts that are signed, they don't take into account people making mistakes or changing their mind.

    Its a bit like if you sign a hire agreement for a minimum length of time and get a discount, even if you return the car earlier you won't get a refund.

  14. #14
    Originally posted by Tanuk
    The problem is that businesses rely and make forecasts based on the contracts that are signed, they don't take into account people making mistakes or changing their mind.

    Its a bit like if you sign a hire agreement for a minimum length of time and get a discount, even if you return the car earlier you won't get a refund.
    I kind of agree with Tanuk on this matter.

  15. #15
    Originally posted by G2-Hosting
    I kind of agree with Tanuk on this matter.
    Ditto...your annual payment (along with many others) probably loaded up the advertising budget, support staff budget, equipement, etc.

    Nicely put Tanuk.
    SuperWebHost.com, a Digitally Justified Company
    Celebrating our 9th year in Business

    Proudly Hosting with CANADIAN bandwidth
    Managed Hosting, Multi-Domain Hosting, Colocation, Merchant Accounts

  16. #16
    How about try riding the wave through the rest of the year, and see what happens? What's the worse that can happen, your money gets wasted, right.

    Well, things arent looking much better then that right now. Sorry, cause it does suck, but perhaps, next time you will either read the TOS closer, or not purchase by the year.

  17. #17
    Join Date
    Apr 2004
    Location
    Phoenix, Arizona
    Posts
    151
    Originally posted by cybexhost1
    Take the amount of money you paid, deduct the regular monthly charge for the amount of time you used after payment - then take out a slight administrative charge for 'early termination fee,' and your off on your way.

    At least, that's what I would do.
    I believe THIS is the way. wtg, John.
    IMO, the administrative charge should cover the cost of processing the initial (in this case the new annual) transaction, plus one month's of service at the normal monthly price. That would be fair, in my opinion.

    Dan
    http://www.IwantFUI.com
    If you could host a new kind of content from your old-fashioned web servers
    and make new money from your customers and differentiate your business all at the same time... could you afford not to try? See the new site

  18. #18
    Join Date
    Apr 2004
    Posts
    44
    Okay I think things are sorted out now. I found someone to take over the webspace. So now I'm just going to e-mail the company saying someone else is going to take over. I hope that goes well...

    I have certainly learned my lesson. Thank you everyone.

  19. #19
    Nice work Ticky. It sounds like a solution that should work for everyone.

    Keep us posted.
    SuperWebHost.com, a Digitally Justified Company
    Celebrating our 9th year in Business

    Proudly Hosting with CANADIAN bandwidth
    Managed Hosting, Multi-Domain Hosting, Colocation, Merchant Accounts

  20. #20
    Grats on working the problem out, hope everything works out with the new host.

  21. #21
    I just wanted to point out something else. Some credit card merchant accounts cannot do partial refunds. If the company were to send a check to the user, that user could always do a chargeback as well.

    (This is just a general point, regardless of how you paid)
    Hockey is Life

  22. #22
    If you were satisfied with that host why didn't they let you downgrade your account? Jeez, I would just refund you the difference in what you already used.


    <<Signature to be setup in your profile>>
    Last edited by anon-e-mouse; 05-11-2004 at 09:59 PM.

  23. #23
    Join Date
    Mar 2004
    Posts
    93
    VanHost wanted to answer your question. Personaly I think that the proper price to charge would be somewhere between 50% of whats paid and the full 100%, so his refund would be around 50% to 0. But I wasn't really trying to help him find the "right" solution so much as provide advice to get his money back if he felt he was entitled to it.

    As a personal rule I generaly just refund any customer who is not satisfied and gracefully discontinue working with them I concentrate on customers that are profitable and those that arn't I try to make them happy even if it means a full refund so I don't waste time fighting back and forth when I can be trying to promote to get more business.

    In the case when someone in the forums ask for advice I try to give them the best information I can to achieve their goals even if they are not doing the same thing as I would in the same situtation. As a web host I would be kind of screwed if all my clients decided that they wanted to pre-pay then ask for a refund and I provided it.

    I provide the best advice I feel I can to anyone who asks. If the web host wanted information on how they can reduce risks I would have provided the following tips:

    1) Provide something that is delivered to the customers billing address via a signature required courier like UPS. If you are ever get asked by a CC company to provide proof that a product was delivered the signature reciept would be sifficient in many cases to cause the other side to lose the dispute even though the delivered document etc... may have little if nothing to do with the service provided.
    2) Instead of selling the hosting per say. Sell a free year lease of webhosting with a setup fee equal to the amount you want to collect. Then after setting up the site send a contract to the customer to sign and fax back that says the website has been setup to their satisfaction and that they are recieving 12 free months hosting. This way if a customer cancles after 3 months there is no pro-rated refund since they are only canceling what is already free. This sounds a little cheesy but it makes alot of sense. Aquiring the customer and taking the time to get them configured and going is the great bulk of the cost. So it makes sense in some situtations to charge for the setup rather then the 12 months of hosting.
    3) If you offer design and hosting, give away the hosting for free and get the design signed off on. Many times CC card companies can say that your not officialy entitled to the money until after the entire services have been performed. You strengthen your position if you can show that the paid portion of the service has been rendered completely and the customer has signed off on it.
    4) Written contracts with client signatures are more official legally and also in the customers minds and makes it less likely that they will complain.
    5) Just service the customer well so they have no reason to complain.

  24. #24
    Join Date
    Apr 2004
    Location
    Phoenix, Arizona
    Posts
    151
    Originally posted by elle1961
    If you were satisfied with that host why didn't they let you downgrade your account? Jeez, I would just refund you the difference in what you already used.
    __________________________

    Diamond Web Hosting
    Hosting, Dedicated Servers and Reseller Accounts
    Good question.

    Dan
    http://www.IwantFUI.com
    If you could host a new kind of content from your old-fashioned web servers
    and make new money from your customers and differentiate your business all at the same time... could you afford not to try? See the new site

  25. #25
    i know i would do a prorate. Some other companies like cell phone companies and apartment management companies work a bit differently though. it just depends on where the host gets their direction from.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •