I didn't
use my website last month, do I still have to pay for it?
As a website hosting company
we get this question all the time and most people don't see
anything wrong with asking it. So I wanted to take some time to
explain why we have to charge people even if they did not access
their website or it was offline for not being paid.
First, like every business we
have overhead and just because people don't see it we still have
to pay for it.
In order to keep websites
running there are several key elements in addition to the million
dollars of hardware in place.
Just like any business, a
hosting company has staff, offices, phones, power and rent to pay
every week. Just because you don't see it does not mean it is not
there.
When you call, someone has to
answer the phone, the phone has to be paid for as well as things
like insurance, heating and air conditioning, building
maintenance and general office expenses. Simple things like
printer ink and paper can add up to hundreds of dollars a month
all by themselves.
So running any business can be
expensive even before you have one single customer.
We are not unlike any other
business and we have a certain overhead that much be paid every
month just to stay open.
But lets talk about what your
individual website costs us over and above those costs.
Each server has
limited space and resources so we can only have a small number of
websites on any given server and with our system we run almost
real time backups so each website is stored on 3 servers with an
additional server monitoring the main website ready for failover.
This makes the cost on one
website much higher, however it provides much higher reliability
and security of data over the single sever models run on almost
all other networks.
The datacenter is an animal of
its own. It has a complete battery backup systems, a failover
generator and complex power distribution system that all have
components that have to be maintained, tested and replaced on a
regular schedule.
Racks of servers run 24 hours
a day and have limited lifespans.
Think of it like leaving your
car running in your driveway, rather than the car lasting 10
years it might only last 10 months if used non stop and never
turned off. Not to mention how much gas you need to keep it
running, probably more than $100 a day or more.
So keeping servers running 24/7
is also expensive and to store a website or keep it running we
have to keep everything running. Each server burns electrical
power, needs cooling which uses more electricity, back up power
which burns more electricity and when items wear out they need to
be replaced.
If you buy a new car for $30,000
and use it for 10 years, that is not bad. But if you pay $30,000
and it only lasts one year then that gets expensive. If you let a
neighbor drive it to work everyday and they keep it full of gas
when you need it, it still costs you money because the 50 miles
they drove today is 50 less miles you can drive the car over its
lifetime. It is also 50 miles closer to needing expensive
maintenance.
In our case, the average
computer nodes are in the same price range as that new car and it
wont last 10 years. Components like hard drives can be $2000 to
replace for each server, so having hard drives running all the
time gives them a very limited life span.
Since we can only have so many
websites on a server we have to split the cost of those expenses
evenly over all the websites and this is actually a large chunk
of what we charge each month.
That should be easy enough to
understand, we just can't keep your website online without it
costing us money.
But lets look at our bandwidth
costs.
You probably have an Internet
connection in your office and it is likely very reasonable, but
you are not hosting websites, so bandwidth volumes are low in
comparison to ours.
We have to have dedicated
fiber optic lines run directly to our data center. We are not
tapped into the local broadband access, we actually have lines
that run from the datacenter to the local telco hubs. To get that
we have to sign long term contracts for minimum usage. So we are
paying for the bandwidth whether anyone use it or not.
But don't think
that just because you didn't do anything with your website
that it was not consuming our bandwidth.
Just feeding the
bots is expensive.
Crawlers from
google, bing, yahoo and others crawl websites daily, so even
though you had no visitors or used they website yourself, the
bots were still accessing the website, consuming bandwidth
and causing hard drive accesses that further degrades the
equipment. Just like driving your car 50 miles a day.
Just having a domain name
pointed to our network costs us money.
If our mail servers need to
relay mail, respond to spammers trying to spam domains it uses
bandwidth and costs us money as well as CPU time on the servers
and wear on hard drives.
Name servers run 24/7 to
answer name requests from the bots to redirect them to your
website.
It does not matter that you
don't have anything on it, that costs us money and eats away at
equipment that we have to replace on a regular schedule.
Sure, we are a small company
and we have our own datacenter, so our expenses are much less
than larger companies. But lets look as just some basic costs
that we have to deal with regularly.
Replace 1 UPS
Unit $15,000
Server Nodes $25,000
Hard drive
replacement $800 each $2400/server
UPS Battery
replacement $5,000
Backup
Generator Replacement $10,000
Main server
node replacement $100,000
Hub
replacements $3500 each
Main Router
Replacement $25,000
IP Allocations
$2000/year
Those are just some of the
basic operating costs we incur as a result of leaving equipment
running 24 hours a day. As you can see, the cost is more than
many people spend on their homes and homes are usually paid over
30 years but ours are paid cash up front because we can't finance
equipment that might only last a couple of years.
So when you look at
your credit card statement and see a bill for $20
and are upset that you did not even use the website, understand
that it cost us $10 just
to keep it on the servers and the back end in place to make that
possible.
While most people think we
have 100% profits the truth is, if there were those types of
profits then everyone would be doing this. If it was that easy,
everyone would be making million of dollars a day with no
expenses.
But anyone that run a business
know having a successful business costs money and profits are
sometimes non existent. By the time you add in advertising costs
and average the customer acquisition costs the numbers are not so
appealing in the website hosting business.
If you go to Walmart and buy a
toaster oven for $20, how much do you think anyone made on that?
Nobody is making $20. It was built, shipped, stocked and sold.
The manufacturer gets his cut, the shippers, the store clerk the
cashier and the store has to use their $1 to cover millions of
dollars in overhead.
Our business is no different,
we have to pay for equipment, pay for bandwidth (our shipping),
pay people to answer the phones (our clerks & cashiers) and
pay for our overhead.
Now I wish we could run a
website off of an old laptop on a cheap broadband connection, but
nobody would be happy with the service and we could not support
enough customers to cover any type of overhead. Yes it would be
cheaper, but we would not have any customers either.
So our rule has to be,
if your website is on the server, regardless of whether you are
working on it, using it or it is down for non payment, you still
have to pay for it.
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