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  1. #1
    Join Date
    Apr 2009
    Posts
    88

    Cloud Hosting resell Or in house?

    I have a client that is paying me about $450 / month for 3 dedicated servers currently. He just said he wants to switch to cloud hosting soon. I don't offer cloud at all...so I'd like to get some ideas as to what might be the best route for me to take to offer him cloud so I can retain him as a client and not lose the full $450/mo?

    (in advance....sorry for the long series of questions)...

    First option:
    Should I become a reseller at an established outfit? If so, How much would be a reasonable fee for this client? Is $450/mo too much for 2-3 dedicated servers worth of cloud hosting resources (about 12GB of ram total)? Can I charge more to make up the loss of reseller payout or am I going to really lose big on this? How will I know if my pricing is competitive or not? Is there a place that offers really good linux cloud reseller packages?

    Second Option:
    Is anyone on WHT able to render services to help me setup an opensource cloud setup at my datasenter (mainly openqrm)? (I will pay as much as I can) I would start with 2-3 maybe 4 servers at my DC.

    Lastly, is there possibly a 3rd option for my scenerio that would remedy this? I just can't take a $450 / mo hit all at once, especially when I work so very hard for this client to keep him happy.

  2. #2
    Join Date
    May 2002
    Location
    MN
    Posts
    223
    I have to say honestly if he wants to "switch to cloud hosting soon" He is either unhappy with your service and is going to switch no matter what, or he is looking for the backing and reliability of a service like Amazon.com in which case he is going to switch no matter what.

    You need to talk to him and find out exactly what his needs are and if you can meet him, otherwise your going to be out $450 a month plus what ever you invest in the hopes of keeping him.
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  3. #3
    Join Date
    Apr 2009
    Posts
    88
    My client and I have been in conversations about cloud for a couple months now, and when he says he wants to "switch to cloud soon", he's told me he doesn't want to switch providers but he wants to stay with me but convert to cloud, because I've told him my company has been looking to go cloud (and this is true...just not this soon). I've been researching this for quite some time off and on with no real solution yet. Sure, he's probably shopped around and sure he might leave, but he's very happy with my services... he tells me this and I bend over backwards for him every chance I get. He simply wants peace of mind with a cloud solution vs. dedicated solution so he knows that if something drastic happens he can scale up quick. Which is why I have been very interested in offering cloud for several months now but nothing has been practical/stable/affordable. (I guess that's just the misfortunes of being a small host in a bad economy). Let me know if anyone has any direct and constructive answers to my original questions above?

  4. #4
    Join Date
    Jul 2002
    Location
    The Big Easy -New Orleans
    Posts
    341
    First thing to do is talk to him about what he thinks "cloud hosting" is... the term means different things to different people. What are the benefits HE wants to get out of it? Is it load sharing? High Availabilty? Regionalizing? Or a dozen other things the cloud could (but also could not mean). It's one of those terms that hasn't been strictly defined yet. Maybe he heard the term, and just thinks it what needs to be done because its the new thing. Anyway... That may give you some direction on where to go with this. For example, if he wants real high availability then that's hard to do correctly with just a couple of servers. But that might also lead to discussions on your the current setups' availability - which hopefully is good, and how you could address concerns with a risk assessment and some new disaster recovery procedures - offsite backups, standby servers elsewhere.

    I am surprised that no one else has brought this up... After you clear this up, you need to diversify your client base quickly. Having 'all your eggs in one basket' so to speak, puts you in a real bind if something should happen. It also means they have you in a real tough spot bargaining wise. Not that you needed to hear that, but putting it out there in plain english for others who may come across this thread.
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  5. #5
    Join Date
    Oct 2007
    Location
    Tampa, FL
    Posts
    113
    Great responses so far.

    Cloud hosting is a newer technology and people have different conceptions of what it means and how it might help them. Ask the client what they want to or think they can accomplish and then see if you can help them do it another (stable, known good) way.

    Another issue at hand here is that you'd be jumping in to a technology that you're not familiar with to meet one customer's stated goal. If you're not technically capable of providing this service in an excellent manner, I wouldn't recommend doing that yet.
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  6. #6
    Join Date
    Sep 2007
    Location
    Planet Earth
    Posts
    153

    * Live Drive Backup

    If you have the ability, and are not a reseller run your own live drive backup system. The software comes pre-built into the Parallels Infrastructure Manager (PIM). Give them a call I highly recommend the software. you have to be running Virtuozzo 4.0 to make it work.

    You also need your own servers for back ups.
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  7. #7
    Join Date
    Mar 2007
    Location
    United Kingdom
    Posts
    767
    I bet all he wants is clustered webservers.... Plenty of Virtualisation products support it, we use Windows 2008 and Hyper-v which gives us fail-over clustering, meaning a virtual machine is moved to different host machines if one its running on is in trouble, and in real-time without the virtual machine being turned off..

    That in essance is cloud computing, basically next generation up from web farms but at server/service level....
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  8. #8
    Join Date
    Jul 2003
    Location
    NC
    Posts
    270
    What he wants is to jump on the bandwagon of the magical "cloud hosting" nebula, because it's the greatest thing ever and is what everyone is doing. Or at least what the cool kids are up to...

    I doubt that he comprehends what he is asking for. He's been sold on the marketing, not on the product.

    Just give him what he wants...

    Tell him you've "converted" your datacenter into a cloud hosting nebula. Behind the curtain is a couple of VPSs running. That's what it is, right? Also make sure to charge him more. While everyone is talking about how it's soo much less expensive, take out a calculator and figure out that it's about 3-10x more costly after you do the math with the everything associated.

    There might also be a few extra seconds added on to the latency, but who cares, it will scale until it breaks.
    Last edited by TowerOfPower; 08-13-2009 at 02:51 PM.

  9. #9
    I also found that people wants to move to a "cloud" but then, don't have a real idea about what it's. Perhaps your customer only want a discount, talk with them, perhaps he talk with you too about that.

    Good luck!

    I don't suggest you to move to a cloud for just that customer, if don't fit into your global strategy, just leave it move.
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  10. #10
    Quote Originally Posted by TowerOfPower View Post
    What he wants is to jump on the bandwagon of the magical "cloud hosting" nebula, because it's the greatest thing ever and is what everyone is doing. Or at least what the cool kids are up to...

    I doubt that he comprehends what he is asking for. He's been sold on the marketing, not on the product.

    Just give him what he wants...

    Tell him you've "converted" your datacenter into a cloud hosting nebula. Behind the curtain is a couple of VPSs running. That's what it is, right? Also make sure to charge him more. While everyone is talking about how it's soo much less expensive, take out a calculator and figure out that it's about 3-10x more costly after you do the math with the everything associated.

    There might also be a few extra seconds added on to the latency, but who cares, it will scale until it breaks.
    +1 for this suggestion.

    We recently had a customer who wanted to move his website "into the cloud".

    When we asked what he meant by this, he said he wanted the ability to increase number of CPUs, amount of RAM, disk space, etc... all at a moments notice.

    So we "moved" him to one of our big VPS machines, sliced a chunk off for him, and started charging him 3x more $$. He now is now happyily paying us more $$ for the exact same thing. The only difference is that he's now on a VPS (where we can increase resources easily) instead of a dedicated server.

    The phrase "in the cloud" is really just marketing talk. If your customer doesn't know what he *needs*, and isn't interested in discussing it... then why not sell him what he *wants*? Often this will result in a more happy customer and more $$ for you.

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