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WEB HOSTING ARTICLES

The Sky Is The Limit - Only $1/Month...
By: Imagion Web Hosting
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    2004-09-10

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    We do not have a plan offering unlimited emails, bandwidth, and storage space because it is not possible to "give away" services like that for very long. It isn't tough to reason that it is impossible to make money with a web hosting plan that offers so much up-front, but doesn't charge enough to cover its costs.

    So, let's begin with a question:

    "How can companies offer so much for so little?"

    Here are a few thoughts to ponder:

    Many of these "unknown" companies are scams, pure and simple. They are started up, typically charge an annual fee, and tout the monthly rate (paid annually) as if it compares to a regular web hosting company's monthly rate. The catch here is that in many cases, these companies obtain a significant number of customers and then eventually file for bankruptcy. What happens to the pro-rated amount for the remainder of the customers' annual premium? Well, that is a mystery, it is rarely ever refunded back to the customer. We've seen several posts on message boards of where this has happened, and this is why we do not try to compete in that "super-low-cost" market.

    If ANY web hosting company charges less than is reasonable for services such as emails, bandwidth, etc that it offers and it sounds too good to be true, then it probably is not true, or won't be for long. Here's the deal. Many of these companies , some of them are the largest hosting companies around, are left over from the Internet boom when venture capital was flowing like honey in the Promised Land. These companies still live by the flawed idea of "give it away to get market share; then raise prices." That idea worked for Microsoft with their "Word" product because there was no real competition at the time. In the hosting business, now almost a commodity, giving it away is ridiculous because when you finally start to raise prices --guess what?-- your customers will just go to the next best deal. This time, they'll want someone more reputable and straight-forward about pricing; companies like Imagion.com!

    Furthermore, these companies that are practically giving away hosting are doomed to go out of business eventually, and will leave customers stranded. This was the case with the DSL fiasco when Covad and several other major players claimed bankruptcy. The stranded customers were then SOLD to other companies and resulted in a nightmare for many of those affected. Well, similarly, in the hosting business, once their magical venture capital runs out and their flawed business model fails, their customers will face the same situation. At that point, many of those customers will most likely flood the market, if they care about service and reliability, and they will be looking for companies like Imagion.com, companies that put issues like reliability, service, and honesty at the forefront of its business model.

    It is possible to take advantage of these low prices in some cases but eventually, the customer will probably get "burned." If price and extravagant service offerings are THE most important, then maybe it's worth it to risk (just hope they don't get an annual payment and then drop their service). However, quality service, reliability, and superior support comes at a price.


    DISCLAIMER: The content provided in this article is not warranted or guaranteed by Developer Shed, Inc. The content provided is intended for entertainment and/or educational purposes in order to introduce to the reader key ideas, concepts, and/or product reviews. As such it is incumbent upon the reader to employ real-world tactics for security and implementation of best practices. We are not liable for any negative consequences that may result from implementing any information covered in our articles or tutorials. If this is a hardware review, it is not recommended to open and/or modify your hardware.

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