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  1. #1
    Join Date
    Jul 2009
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    New Hosting Companies Vs. Established Once...

    Hello,

    This is my first discussion topic that I would like to start here...

    Hope this discussion goes on fair and without hurting any1.

    I would like to discuss over new companies which have just put there steps towards hosting business.

    I know many of the people here and everywhere believe that only established companies with a nice price tag of almost around $5 per month for smallest web hosting plan can give you best support and uptime. No doubt they can give you nice uptime but what about the support... leaving some companies all other big and established once do not offer you what you should actually get.

    Companies with a huge customer base receives a large number of hosting support requests from there customers daily which they can not fulfill on time. Thus resulting in delay and some times inconvenience to the customer.

    Where as on other hand new companies or mid level companies that just arrived or been in industry for a few couple of months is much better then them.
    A solid reason to support this is if they want to be in this industry they will surely provide all the best of support and uptime and industry leading softwares and products to there client for the very low price as compared to other big ones.

    Now the point to be noted is the people only don't believe new companies just because they are new... I don't understand the reason why people have a mentality of treating OLD IS GOLD....

    When new companies just to establish them selves in this market are offering tons of services for a much lesser price to what other big ones do then why do people think they are going to fall down... They too have there business plans setup or else they won't advertise it different forums and waste there precious time in which they could have done many other jobs....

    I know this is a never ending topic but you surely need to broaden your thinking and start thinking about this second phase of hosting industry...

    With my article I surely can't mentality of too many people but surely can start a step ahead of others to let people think on this....

    Hope I can scratch some great minds with my writting and they can comment some great ideas and pros and cons...

    Thank You.

  2. #2
    Greetings:

    1. Not everyone competes on price -- established or brand new.

    2. Established companies have established a track record -- good or bad.

    3. There are statistics in terms of the likelihood of a death of a company. i.e. If a company survives past 6 months, they are most likely to survive y more months; if they made it to two years, they are most likely to survive another z year. If they broke the five year barrier, they are most likely to last another x years. If they broke then ten year barrier, and so on.

    Brand new companies don't have a track record, are more likely than not to complete on price. Are more likely than not to miss calculating true costs into their pricing; and as such are more likely to run into issues where they cannot grow... and the list goes on.

    Just like brand new employees on the market (just out of any school) have an uphill battle for employment, so do brand new hosting providers. They need to establish and prove themselves.

    Thank you.
    ---
    Peter M. Abraham
    LinkedIn Profile

  3. #3
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    Mar 2009
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    Santa Monica, CA
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    One thing you have to consider is that its easy to start a hosting company - even if you don't know what you are doing. I would say that your benchmark of 2 months is too new to tell if the above describes the host under consideration.

  4. #4
    Join Date
    Jul 2009
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    95
    Greetings:

    1. Not everyone competes on price -- established or brand new.
    Its not true... even hosts like hostgator are offering hosting for just $0.1 for first month.. so they too are competing.

    2. Established companies have established a track record -- good or bad.
    Yes but a company entering this market knowing the risk of competing with such great monsters out there will always try to establish a great track record.

    3. There are statistics in terms of the likelihood of a death of a company. i.e. If a company survives past 6 months, they are most likely to survive y more months; if they made it to two years, they are most likely to survive another z year. If they broke the five year barrier, they are most likely to last another x years. If they broke then ten year barrier, and so on.
    I agree at this point... but if even you stay there for like 6 months and get only 5 customers or so then that would not be in anyway going to help you stay alive. Thus by offering great deals you can get more customers and then you can surely strive.

    Brand new companies don't have a track record, are more likely than not to complete on price. Are more likely than not to miss calculating true costs into their pricing; and as such are more likely to run into issues where they cannot grow... and the list goes on.
    There's no any harm in providing around first 30 or 50 customers hosting for $1 per month as this would establish a customer base for them... And in turn through word of mouth and other localized advertisements you can get more customers to whom you can charge a bit more.

    Just like brand new employees on the market (just out of any school) have an uphill battle for employment, so do brand new hosting providers. They need to establish and prove themselves.
    This is what I am trying to say that even new companies should be given a chance to prove them selves... people think that new companies can't, but the fact is new companies can surely......



    Hope I have not offended you in any way... I have just put up my points, just a try to remove that so called "new company" myth ....

    Thank You.

  5. #5
    Join Date
    May 2005
    Location
    Alabama
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    I have a newish hosting company, I compete on price, support and uptime. I feel like the main reason pick older companies is because they have been around, trusted name, and has not closed down. However, I do not like large old established place, I believe, if you never give a new company the chance then how are they suppose to stay around? I offer everything I can in my power to my clients.

  6. #6
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    Quote Originally Posted by VPSGuys View Post
    I have a newish hosting company, I compete on price, support and uptime. I feel like the main reason pick older companies is because they have been around, trusted name, and has not closed down. However, I do not like large old established place, I believe, if you never give a new company the chance then how are they suppose to stay around? I offer everything I can in my power to my clients.
    Yes this is the point... Until you give new companies a chance how can they prove them selves....

  7. #7
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    Quote Originally Posted by VPSGuys View Post
    I have a newish hosting company, I believe, if you never give a new company the chance then how are they suppose to stay around? I offer everything I can in my power to my clients.
    Quote Originally Posted by ragavbpl View Post
    Yes this is the point... Until you give new companies a chance how can they prove them selves....
    Well you better give your prospect good reason to give their hard-earned money to you rather than someone else. What do you have in your power to give them that no one else is claiming they can give?

    As a new host, pre-existing personal relationships made up of people who already trust you are probably the most important source of customers

  8. #8
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    Jul 2009
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    Same is the case if you broaden your thinking... I mean why should you not try a new hosting company when they are offering hosting to you with so much features....
    Why only stick with those old too professional people who just treat you as there customer and why not try a new company who can give you there heart and soul to serve you up so that you remain with them....

  9. #9
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    Mar 2005
    Location
    USA
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    Its not true... even hosts like hostgator are offering hosting for just $0.1 for first month.. so they too are competing.
    I believe dynamicnet was trying to say is there are hosting companies that do not try to compete on "lowest" price, but instead on quality of service/performance etc.

    There are many companies trying to compete on price alone. My own thoughts on this are it's a revolving door strategy. Those people looking for hosting at the lowest possible price possible will often jump hosts whenever they find a better deal or lower price. There is no way that budget hosts can compete with those hosts built for performance, quality of service, and quality of support no more than a hosting company that is built around quality of service and support can compete with budget hosts. They are completely different, serving different markets and customer bases.

    As far as new vs established companies. The above also holds true, completely different markets and customer base. A well-established company wanting to host their online presence is not going to risk their investment that can be in the 10's or even 100's of thousands of dollars on a new company offering budget hosting.

    This is really no different than any other service someone pays for. You wouldn't expect fine quality food at McDonalds and would not hold them to the same standard as if you paid $75 a plate. Those that are looking for quality in anything know they are going to have to pay for it. We all know we can't eat steak for the price of ground beef.
    Last edited by tcstatic; 10-12-2009 at 11:43 AM.

  10. #10
    Quote Originally Posted by VPSGuys View Post
    I have a newish hosting company, I compete on price, support and uptime. I feel like the main reason pick older companies is because they have been around, trusted name, and has not closed down. However, I do not like large old established place, I believe, if you never give a new company the chance then how are they suppose to stay around? I offer everything I can in my power to my clients.
    Heya, I've got a newish hosting business running too. I think your view there is one-sided, customers want to be sure that they're not investing their hard-earned money into a dodgy host, just look at some of the threads here for examples of dodgy hosts.

    Not all customers are able to "try out new hosts" for financial reasons (and it is also time consuming) unless you're giving them free hosting. So at the end of the day, they'll turn to the more established ones.

    Start of with your friends and people you know, and hopefully within a year or two (yeah, that's probably how long you'll be making an overall loss) word will spread around and you'll be able to see an increase in customers.

    Good luck!
    NeutroHost.com - Carbon-Neutral Web Hosting at affordable prices!
    Reliable shared hosting, daily support, and low prices. Contact us at Support@NeutroHost.com

  11. #11
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    Quote Originally Posted by ragavbpl View Post
    Its not true... even hosts like hostgator are offering hosting for just $0.1 for first month.. so they too are competing.
    He means that there are providers who compete on quality instead of price in the more premium end of the market.

    Yes but a company entering this market knowing the risk of competing with such great monsters out there will always try to establish a great track record.
    Unfortunately this industry is plagued by people who want to scam and steal from others, or who are only in it for the money and don't care about their clients. These guys make it much harder for everyone else, especially new providers, to be trusted.

    I agree at this point... but if even you stay there for like 6 months and get only 5 customers or so then that would not be in anyway going to help you stay alive. Thus by offering great deals you can get more customers and then you can surely strive.
    You should not be alive with only 5 clients after 6 months, unless you are just throwing money at the business. If after 6 months you only have 5 clients, you are doing something horribly wrong. in that case you either are not dedicated enough or simply don't know how to run a business, which will seal the company's fate anyway.

    There's no any harm in providing around first 30 or 50 customers hosting for $1 per month as this would establish a customer base for them... And in turn through word of mouth and other localized advertisements you can get more customers to whom you can charge a bit more.
    Theoretically yes, but at $1/mo most of those 30-50 clients will likely be spammers or other malicious individuals. New and cheap hosting providers are these guys' best friends.

    This is what I am trying to say that even new companies should be given a chance to prove them selves... people think that new companies can't, but the fact is new companies can surely......
    You cannot buy time, and it is very difficult for new hosting companies to make it past the 2 month mark. Of course there are many new providers that go on to be quite successful, but usually it is easy to tell which ones will fail and which ones will succeed. Though I agree that if you find a relatively new provider that interests you, you should give them a chance. My philosophy has always been that you can get better service and support at lower prices from smaller, newer companies that can't rely on their size, influence or marketing budgets to attract clients and instead have to do so through providing great quality service.

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