Does "green hosting" really exist?

Posted on January 24, 2008 10:19:58pm   |   Permalink   

Network Solutions Preregisters Searched Domains

After completing the "registration", we performed a new WHOIS lookup on the domain. And, what do you know? The domain record had been instantly updated with the correct information as we entered it:



Note the fact that the same expiration date remained unchanged. This is proof that the domain had already been registered, and that Network Solutions simply transferred ownership of the domain to our customer, simply because we paid them their extortion fee.

Many years ago companies would perform "domain prospecting" in hopes of registering a domain that one day might become popular. Certain unscrupulous companies would go so far as to register domains with trademarked brand names of other companies. The domains would be offered for sale if the owner of the brand would agree to pay a high price. Of course, many rightful owners of the brands simply turned around and sued the prospectors for having infringed on their copyright by registering the domain in the first place.

That was many years ago. It is rare for companies to do this today, and practically unheard of for a domain registrar to nefariously steal away a domain that a well-intentioned owner of the brand wishes to research and register.

In our opinion (and this is simply an opinion), only a company desperate for business, devoid of business ethics, and willing to do "whatever it takes to keep your business" (a direct quote from Network Solutions' domain control panel) would behave in this manner. What this tells us is that our prior beliefs -- about Network Solutions losing business, and likely headed for implosion -- seem to be coming true.

With their latest stunt of pre-registering domains and forcing would-be domain owners to buy from them, Network Solutions is inviting a class action lawsuit, especially if they continue to pre-register domains containing the trademarked brand names of other companies.
 
Our newest customer may not be a multinational corporation, but they have the right to protect their brand, as does any other company. We have a feeling that, were this to happen to a larger company, Network Solutions could well find itself being sued by that company for trademark infringement. And, were it to lose the case, it would seem poetic justice, served, for Network Solutions to end up fighting for the right to retain ownership of its own name.

Posted on January 19, 2008 11:30:23pm   |   Permalink   

The Pitfalls of "Overselling" Web Hosting

The Story Behind Overselling

Because web hosting is a highly technical service, potential customers in need of web hosting may not know what to look for in a good provider, and so fall back on the basic economic principle of value for their money, or, getting more for less. They like the idea of being able to get ample space and data transfer, lots of freebies, add-on tools -- in short, a complete hosting, design, and marketing package -- for pennies on the dollar as compared to consulting with a professional company. If they can get it all for less than $10 per month, it certainly is a bargain of a deal!

Many national web hosts are keenly aware of this trait in unsuspecting customers, and use it to an unfair advantage by offering overly huge amounts of disk space and bandwidth with their hosting plans. Furthermore, the pricing for these account are heavily discounted, to such a low price that most customers never give it a second thought and sign up. In fact, should they encounter a comparable host that charges "twice the price", they tend to want to know why they should pay twice as much for the same level of service.

As an enterprise-class hosting provider, we have encountered this type of feedback, and we can safely say, it is only twice the price for the same perceived level of service. Why do our operational costs seem higher? Why should our customers pay so much more for what seems to be so much less service? The truth of the matter is, our prices may seem higher, but in fact the value is greater, simply because we do not oversell our services.

How Overselling Works

The basic notion of overselling is to resell the same resources many times. Consider this simple exercise in numbers.

The amount of space the average web site needs is less than one Gigabyte. The average monthly bandwidth the site might us is less than 10 Gigabytes. If you pay $10 per month for the service, here is how the pricing breaks down:

Now consider that a host is offering you much more at the same price. As an example, 100 Gigabytes of space and 1000 Gigabytes of bandwidth, still for only $10 per month.

What a bargain! $.10 per Gigabyte of storage? A penny per Gigabyte of bandwidth? It looks too good to be true. And it is, because no matter how large or popular your web site, you will never use all of that space or bandwidth. You won't even come close.

Now, that same host knows your resource needs are only 1/100th of what they are offering you. Because you will never use all of your space and bandwidth, they are likely reselling the unused portions of your account to other customers. So, while they are offering you 100 Gigabytes, through the process of overselling they are able to sell your leftovers to 99 other customers just like you.

Look at this chart of what a typical web site might use in terms of space and bandwidth compared with what is provided in an oversold hosting plan:

Look at those numbers. Just 1% of the customer's allotted space is actually being used. Technically, this means a web host could turn around and sell this same space and bandwidth to 99 other customers, at pure profit, and not have to worry about running out of space or bandwidth.

Now look at an above-average web site in terms of space and bandwidth, and compare that to what is provided for in an oversold hosting plan:

This single web site is using 30% of its allotted space and bandwidth. What happens if several of these sites are hosted on an oversold space?

Just four popular sites have used up all of the available space and bandwidth, plus another 20%. This doesn't address the other 96 customers who have been placed on this oversold space. What about them?

Totalled up, all 100 web sites are now using up 216% of the space and bandwidth available to the host. Or rather, the host has gone OVER its space and bandwidth by 116%. This can mean ONLY one thing - web sites are now malfunctioning, databases not being written to, email not being sent or received, and many, many angry customers are calling to find out just what is happening.

Let's recap and compare the two previous web hosts (Web Host 1 and 2). Example 2A below shows what Web Host 2 is actually selling you, after accounting for reselling it to 99 other customers.

You see, in the end, the second web host is providing you everything as the first. The same space, bandwidth and price. The difference is, the first host advertised its services honestly and accurately, and guaranteeing you the space and bandwidth you are paying for, whereas the second host has oversold their services and resold your allocated space and bandwidth 100 times to make a hefty profit -- with the added risk that nothing is guaranteed.

The Real Costs of Web Hosting

Compared with the example above, our per-Gigabyte storage and bandwidth may seem that they are priced higher. In reality though, because we do not oversell our services, our per-Gigabyte of actual, apportioned space and bandwidth per account is much lower than many national discount hosts. Furthermore, not only do we guarantee you the space and bandwidth you pay for, we guarantee that the quality of our support will far exceed any national discount host.

The hidden costs of hosting rest primarily in these four things:

1. Quality Servers. Each of our shared hosting servers run high efficiency dual-dual (quad) core CPUs with a minimum of 4GB RAM, and between 350 and 750 GB of RAID1 (redundant) storage space. These servers, on average, are four times more powerful than the type of server most hosts use for a shared environment. They are also four times as expensive.

2. Per-Server Account Limits. Though Ensim offers unlimited-domain licenses, we have chosen to limit the number of domains on each of our servers to a maximum of 250 accounts. This ensures that our services, per server, cannot be oversold to more customers than we have available resources.

3. Redundant, Provisioned Bandwidth. As for bandwidth, our hosting plans do provide a lot of it, by a ratio of 50 times the monthly bandwidth per each Gigabyte of storage space. We are able to offer this because we have invested a lot of money into quality, redundant, affordable bandwidth through major backbone carriers. Should we need more, we will buy more from our carriers. It is just that simple.

4. Professional, Caring Support. Finally, our support services are not outsourced to India to save costs. We operate two sources of first-world support: one based in Oregon (U.S. customers), and one based in the U.K. (for local customers and night-time U.S. support). Our support representatives understand and speak your language. They are all highly educated, attentive to quality, and sincerely care about the well-being of your business and your web site. Support like this simply costs a lot.

All That, and yet We Still Don't Oversell

When you look at the costs, you might ask how we are able to make a profit. While our operational costs may seem higher, it is through operating a higher-quality and streamlined hosting service that we have been able to offset all of these costs.

While the national vendors may seem to be giving you a great deal, they are in reality charging you for services they can not deliver on. Were each of their customers to demand immediate access to the apportioned space and bandwidth, most discount hosts would implode in less time than it would take for you to back up your data and move to a new provider.

On the contrary, Canvas Dreams has never oversold our services, not only because we feel it would be unethical, but also because there has never been a need.

Ultimately, to be a profitable host, the service has to be good, the provider accessible and accountable, the customers taken care of and listened to, and in the end, the success of every participant will naturally follow. We have done just that, and we are living proof that quality hosting can be done effectively if done the right way.

Canvas Dreams will never oversell its hosting service. You have our guarantee.

We ask you to consider this when comparing our services to other providers, and encourage you to ask them whether they will really honor what they claim to be selling you. We look forward to speaking with you and welcome your comments.

Posted on January 09, 2008 11:25:03pm   |   Permalink