Web Hosting Talk : Web Hosting Main Forums : VPS Hosting : Offering VPS - is it worth it?

[w3bdesign]

I've been so far offering resellers and shared hosting, but is it worth it to offer VPS as well? What sort of extra administration would this be to me? And is there anything I should consider regarding VPS? I'm totally new to VPS.

[SEATi]

It can be a profitable business, but there are 2 ways to do it:

1. To get a nice colo rack somewhere so that you can set up powerful servers (maybe quad xeons) and offer your VPS there. That way you don't have to pay for a quad xeon as a dedicated server.

2. To get smaller servers and offer low-end VPS.

We've sticked to the 2nd way, what most people don't know is that they don't need a huge CPU. I you know how to optimize your OS then you are on the right track.

We've successfully launched 8 low-end VPS in a small box. Currently one of our VPS "host" servers is a Celeron 2.4 with 512 Mb RAM. We have 8 VPS running there, selling each one for $20.00/mo (each VPS has 5 Gb space), so we are getting $160/mo for that server. If we had sold that server as a dedicated server we would have sold it at $80.00/mo, so we are really doubling our profits.

Now, it's easier to manage a server with 8 VPS than to manage a server with shared webhosting customers. We provide each VPS customer with a control panel (our own, so we don't have to pay any license fees) and they really don't need any assistance (even when we have a support team available), they can even restart their VPS so what we have to do in that server is to reboot it evey 4 months and to keep the kernel and other software updated.

[sshepherd]

I wouldn't waste any money on a quad xeon, you're not going to get the performance compared to spending the same money on dual xeon servers.

With a dual xeon you could comfortably handle anywhere from 4-50 (just depends on your plan offerings) VPS's.

You should really do a search in this forum, there was a huge discussion on this several weeks back with many VPS providers giving their input on this topic.

[pcnet21]

That's great. What kinda of setting are you running? Meaning which OS, which VPS software and control panel?

thanks

Originally posted by SEATi
It can be a profitable business, but there are 2 ways to do it:

1. To get a nice colo rack somewhere so that you can set up powerful servers (maybe quad xeons) and offer your VPS there. That way you don't have to pay for a quad xeon as a dedicated server.

2. To get smaller servers and offer low-end VPS.

We've sticked to the 2nd way, what most people don't know is that they don't need a huge CPU. I you know how to optimize your OS then you are on the right track.

We've successfully launched 8 low-end VPS in a small box. Currently one of our VPS "host" servers is a Celeron 2.4 with 512 Mb RAM. We have 8 VPS running there, selling each one for $20.00/mo (each VPS has 5 Gb space), so we are getting $160/mo for that server. If we had sold that server as a dedicated server we would have sold it at $80.00/mo, so we are really doubling our profits.

Now, it's easier to manage a server with 8 VPS than to manage a server with shared webhosting customers. We provide each VPS customer with a control panel (our own, so we don't have to pay any license fees) and they really don't need any assistance (even when we have a support team available), they can even restart their VPS so what we have to do in that server is to reboot it evey 4 months and to keep the kernel and other software updated.

[w3bdesign]

Originally posted by pcnet21
That's great. What kinda of setting are you running? Meaning which OS, which VPS software and control panel?

thanks

I'd like to know that too.

[SEATi]

We are currently using FreeBSD's jail() function to provide the VPSs, along with a couple of tools we developed, like one that allows us to control the CPU/RAM usage of each process (it doesn't limit the VPS, but alerts us whenever a VPS is using more CPU/RAM than it's allowed), a jail patch that lets us use more than one IP on each VPS.

As for software/panel, we created an autoinstaller that installs:

Sendmail
Procmail
Amavisd
Clamav
Spamassassin
Apache + mod_ssl + mod_perl + mod_rewrite + mod_throttle
PHP (cURL, GD, JPEG, TIFF, TTF, ZLIP, ZIP, FTP, etc)
MySQL
PostgreSQL
FTPd
SSHd
A POP3-before-SMTP control system
OpenSSL
Perl's most used modules
Security updates
Autoresponder system

All this software is installed with just one command, using pre-compiled binaries so the complete install process takes less than 15 minutes.

As for control panel, we developed a new control panel called WHCPANEL (Web hosting control panel), this panel will be distributed soon, but we are still fixing some bugs.

[BurstNET]

VPS is a hot product, and you should definately add it to your product list. If you do not offer it, potential customers will go to someone else that does instead. Administering VPS is no different that administering a dedicated server, but you also need to know the VPS sotfware package as well.

To start, I would recommend reading Sw-Soft's Virtuozzo manual. One you get thru that, you will be able to decide on whether it is something that you can handle or not.