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To montyburns: easy, I've already got enough customers to pay the bills and put some cash in the pocket. Another 500 customers and I'll have a very tough decision to make, do I want to be a big business or do I want to quit taking customers, because at that point I'll be unable to control it all myself. Yes it is a given that any and all web hosts count on people not using 100% of their alloted resources 100% of the time. However, if 100% of my customers used 100% of their resources 100% of the time then yeah that'd be a slight problem. Nothing major just means I'd have to double the amount of servers I have online. Which would affect profits, by about 20%. I'd rather that not happen but it'd still be ok.
I've done this sort of thing a long time and got some extremely good pricing on my dedicated servers and the bandwidth. Not only is it viable, after a mere 2 and a half months in business I'm putting a couple hundred dollars a week towards my bills (after paying all the company's bills). Though I won't ever get rich.
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Sounds more like a sure way to get poor to me. I don't care what sort of price you get on a dedicated server. Servers are a dime a dozen and tossing another box online is a minimal investment. But unless you found some sort of magic formula for bandwidth that no other host on the internet has ever managed to find, you're going to be bleeding cash very quickly. Bandwidth costs are virtually fixed and have been for quite some time. They have not fluctated too far from the $3 per GB figure in years and don't look to change in any meaningful way any time soon. And that $3 figure is based on the pipe running at max capacity 24/7 which is never the case in the real world. To have bandwidth to spare for peak times you need to overbuy, so a lot is wasted during off hours. Actual real world cost of bandwidth is between 4 and 5 dollars per GB raw cost. So you're banking on all your customers using less than 20% of their bandwidth allocation just to break even. A lot of other web hosts have tried pricing structures like this and none of them last a year.
Heck, my site is using 30GB+ per month and I'm not even all that busy a site. I could get 7 accounts from you, spread my traffic out over those 7 and use 35GB of traffic for $28 a month. Meanwhile you've paid something like $200 for that bandwidth not to mention the cost of the server, salary for the tech(s) or fees to the NOC if you colocate, salary for the support people, etc. I'd sign up today and save a bundle over what I pay for hosting now, but then I'd just be forced to move again when you went out of business. I'm sure you're an honest guy that's trying to run an honest company, but with an unrealistic pricing structure like that, you're a sure target for honest guys like me who are looking for honest hosting for honest high-resource sites that will honestly break the bank. It would take 1000 "normal" 1GB per month accounts just to make up for 5 or 6 guys like me who followed the rules and never once exceeded your bandwidth limitations.
Really, I wish you the best, but take 2 cents worth of advice (and that advice actually costs me 10 cents, but don't worry, I can sell it for 2 cents and make it up in volume ) and drop your bandwidth allowances to 1GB or even 2GB per month. At least that way you'll attract less resource-hungry sites.