The Hosting Industry

Hello everyone,

Thank you for checking out our post!

The hosting industry over the past few years has become wildly saturated with new competition. As far as any reasonable comparison goes, the industry has mutated into a web of intertwined agencies and organizations, corporations and sole-proprietors trying to take a bite out of the industry, and thus we are left with what we have today. This issue is not alarming in general, but the problem has been amplified by the easily accessible reseller packages and cheaper than dirt Celeron servers our high school students are picking up. So what are we to do now that we are confronted with this problem?

Most owners and employees would concede there is no problem; this is the fact of the industry, and basically a simple fact of our type of economic system. We strive on competition, and if competition drives the market, then we in turn should be thankful, no...we should be praising the heavens for so many great competitors. But upon further inspection, who does this competition really satisfy in the end? Is it the decent hosts, who own their own servers, deal with their clients day in and day out on a personal basis? No, it is the conglomerates of the industry that pick up our dirty pieces.

With every poor hosting contract there is borne a bitter customer! Our customer, everyone's customer, and we are all losing because of this. When a poor host, in general, attracts a customer and fails this customer, the entire bracket this host came from is frowned upon. Most of us in this forum are apart of this bracket; the bracket which lacks the 50,000/month advertising budget, and therefore are lumped together with these poor slums. When in fact upon further inspection we are not all the same, obviously, and we have much to contribute to the market, given the opportunity.

Basically what this amounts to, is the poor host, the high school students, the part-timers, the people trying to make an extra buck are hurting us all. All of their bitter clients are moving directly to the most visible of hosts, the hostgators, the network solutions, the godaddy's, all the while we decent hosts suffer the loss of some very good clients.

What does this mean, what do I suggest? In the end, there is very little that can be done about this, because the irony is, we sell these poor hosts the ability to be what they are. We sell them our reseller packages and our Celerons so we can make an extra buck off of their ill conceived notion that the web hosting industry is a walk in the park, and sometimes we do well doing this. But, we end up sacrificing deserving, long lasting clients, for these one-year wonders who want to start their own cool gaming server, or mom and pop web hosting businesses, etc.. But there is a very small thing that we can do. We can discourage them at every chance we get, discourage those who are obviously not cut out for this business. Those who say, how many sites can I have on my server, or how much money can I make from 10 clients, etc. Encouraging these sorts of hosts is only going to further breed the present problem, and eventually we will all suffer for this, and will be out of business.

Thanks for reading.
 
If you ask me, without so many bad hosts, the good ones would have a much harder job at differentiating themselves. ;)

IMO the real problem are not the kiddie hosts. The customer can learn that they're to stay away from. The problem are big hosts going bad and the big hosts that are bad. When the ones who are supposed to be "professionals" and run businesses by the boook, fail to atain/maintain high standards of service, it gets hard to trust the industry.
 
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I have my own thoughts on this actually that I would like to add to this as well as refute.

I think that the small hosting companies that frequent these forums are an asset to an industry where customers can quickly feel neglected by their provider. When a shared hosting company has 10K+ customers, it is easy to feel like a number (or completely ignored). This is partly the reason why people keep hopping from hosting company to hosting company - because the loyalty can't exist if there isn't enough care from the provider.

We're in the business of reseller hosting and take a beating from time to time by our customers who are...resellers. I'm alright with this for one reason and one reason only: they are on the front line working on a very close level with *their* customers (some who they see on a face-to-face basis sometimes). You could easily consider hosting "resellers" essentially as "client relationship managers" for their respective client base. They give a local face to the hosting world.

I bring this up because many who frequent forums like this do start with a reseller account; they may not have the credentials, the manpower, or the advertising budget. But, they do have a face to present to the few customers they serve!

Cheers,
Roj
 
Thank you for the responses. I have no real issue with new hosts or small hosts, perse. I simply have an issue with the hosts that have no time, and no will to actually provide any sort of quality hosting. This sort of behavior, the starting a business on the whim behavior, generally leads to those clients going straight up, going to yahoo and typing in hosting and picking the one right at the top of the page.

Of course, these are a certain clientelle, and we will not lose a lot of customers in this fashion, but by discouraging these hosts, it may simply help the industry out just a bit.

I agree with you though ldcdc, the hosting industry does benefit slightly from the dirt at the bottom, as they show how bright a lot of the better hosts really are.

Just something to think about.
 
Actually, I think the "reseller" account (with a few exceptions) is cause for alarm. The ease of creating a webhosting "company" has brought forth a plethora of Kiddie and other hosts that crowd out reliable--both large and small--companies. The reseller account is a large culprit in this. To some extent there should be some hurdles to forming your own company--not big hurdles, mind you, but large enough to weed out irresponsible people (or children) who do not have the resources or energy to truly serve customers.
 
We had actually considered asking for a business license and state, prior to selling a reseller account.

Yes, this will most likely slow reseller signups, but it also means that we will be doing our part to help solve the problem. If the person is not serious enough to get these minor details in place, how serious could they possibly be, about running a business at all?

This is just something we had bounced around, but nothing really came of the talk. That of course is not to say we're still not considering it, but there will definately need to be more talk before we take a step like that.
 
I can see the reasons for requesting a business license prior to selling a reseller package, but the problem arrises when someone just wants a reseller package because a couple friends all have websites and they want to get a nice, affordable package with plenty of features.

And while that might be an extreme case, it's still a possibility.
 
The problem is the big hosts concentrating more on getting new clients than managing their exisiting ones imo. When hosts get to a certain size they become greedy. I think there are alot of very respectable and decent "kiddie" hosts out there. I also feel that hosting isn't saturated but the customers are uneducated and often look for the cheapest price packages, they don't consider support/uptime etc.
 
I also feel that hosting isn't saturated but the customers are uneducated and often look for the cheapest price packages, they don't consider support/uptime etc.
I agree with the first part, but I don't with the second. Customers do consider support/uptime, but unfortunately, they believe what the host offers, failing to understand that a promise is not necessarily reality. This is without taking into account the continual confusion regarding what an uptime guarantee really is.
 
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