Wednesday, October 17, 2012

Leveraged Buyouts In Web Hosting

"Get your piece of the web" or some form of this saying is often used by web hosts to try and lure potential customers in. Whether a web host is targeting small business or individuals though television ads, web banners, or other forms of advertisement. The message is always the same, "pick us". In this day and age it is important for small business and individuals alike to have some form of web presence.

Web hosts often try to make the idea of having one's own website for personal use attractive by promoting ideas that personal websites are hip and fun. This formula for success has been repeatedly implemented over and over again, from small hosts to large hosts. The idea that cheaper is better has driven the idea that service at cheaper prices is acceptably worse than service at higher prices. In today's web hosting industry it is war, brand warfare at its best, a flurry of DDOS attacks, slander campaigns and leveraged buyouts. When companies go bust, and the money dries up larger web hosts absorb smaller ones, clients are treated like stock; exchanged and traded at will. Enter the world of the underground stock exchange, a monopoly of sorts where there are no rules. It is ruthless, the competitors are despicable and anything goes, enter the world of web hosting.

I first got started in web hosting in late 2008, I had just started at Michigan Tech and had designed my first website for a customer. The customer was a business which specialized in breeding German Shepard guard dogs.  After finalizing a design for the website it became apparent that the customer was unable to host his own website due to the lack of ability and time, so I decided to research website hosting. A quick Google search led me to WHT (Web Hosting Talk) which is a forum dedicated to all things web hosting. After a few hours of browsing I found a thread on starting a web hosting business. The advice that the thread had to offer was simple, use cPanel, find cheap reseller hosting, get a billing system, and build a website to advertise. I followed the instructions exactly, and in the end I found a company offering a cPanel based reseller plan for $5.00 /month. Immediately after singing up with the web host I started to experience problems, there was a language barrier for starts apparently the owner of the company and the sole employee lacked the appropriate technical skills to help me. This made getting any sort of help nearly impossible. I was desperate to find a new host and fast.

In a completely unrelated string of events I discovered the ability to geo-locate where domain names end up. I decided to try and locate the domain name of the host I was using and it turned out that from that location I was able to determine that they themselves were a reseller of a larger company who had even better prices. Armed with this new knowledge I decided to make the switch to the new company.

Signing up for the new company was easy (it always is), I simply selected which package I wanted from their extremely well designed website, payed with Paypal and was instantly emailed my details, however due to some bug in their system, my account was never created and thus I had to email support. My first impressions of this new company was that they knew what they were doing, they were polite professional and prompt. After a few minutes of explaining that I was a customer of one of their resellers they moved my account off of the resellers account and transferred it to theirs. They helped me with the issues the original host couldn't resolve all the while maintaining a friendly and professional attitude.

After spending countless hours and days fine tuning my own company website advertising my new reseller hosting, I received an email. It read like this "because you no pay your bill, your account will be deleted". I was confused, I checked my invoices, everything was paid, what was this?


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