Kiriki, you nailed it. Explained this perfectly. Thank You Bob Evans CTO
> The bottom line is the value/price ratio. We should all be working to add > value. By any means necessary. > > The pitfall of low priced "services", is that it's hard to balance the > support level and lower price for services. > > If Bluehost and lower end web hosters can completely do away with the > support aspect, certainly SAAS can scale. But if a significant part of > your > value proposition is support, it's real hard to get down this low if any > human is ever involved, and if you pay a living wage to your workers. I > really expect at the ultra low end you have to be willing to do away with > live support, and just provide a product that works....with no support. > > Would people want to buy a web host for $3.95 but if they engage support > pay > $15/hour for it? Perhaps that would work... but I think the value > proposition gets skewed in this sense. Those customers paying this little > likely needs support in a variety of ways. The challenge is to do it all > right, so they don't... > > I agree with Bob, more likely they are subsidizing costs with investment > and > hoping to provide a profitable model in the future with enough market > share. > > Bottom line, is the industry needs to be increasing value, because the > flip > side.... working for no profit, surviving off investment only... there's > no > end-game. You see this cycle time and time again as market share is > grabbed, > then underperforming companies are rolled up. In this process value is > destroyed. > > Ultimately this is also why it's extremely damaging for investors to > constantly invest in companies that don't make a profit, and don't provide > a > successful economical model for the services/products provided. These > companies largely live on investor money, lose money, and in their wake > destroy value for the entire industry. Of course the end-game for the > investors is to make money... I'm always surprised how strong > investment/gambles are for non-profitable companies. I guess there is no > end > to those with too much money that have to place that money somewhere. As > the > rich get richer, there will only be more dumb money cheapening the value > proposition. After all, who needs value when you have willing investors. > > Bottom line is that if it's not worth doing... then maybe it should not be > done. Maybe the race to the bottom is not worth it. Maybe investments that > lose value for an industry should be limited. > > The giant pool of money is now weaponized. > > -Kiriki > > > > -----Original Message----- > From: NANOG [mailto:nanog-boun...@nanog.org] On Behalf Of Bob Evans > Sent: Wednesday, November 25, 2015 5:20 PM > To: Robert Webb > Cc: NANOG > Subject: Re: Bluehost.com > > For an ISP type service - it's almost impossible the make it up in volume > - all you need is one phone call to cost you $10 in support on a $3.50 > service. With that many customers you can imagine how many call to just > ask > what happened or vent after the event is over. > > I founded a cable modem business prior to docsis standard. Call center > with > 150 people in it. People would call for help with their printer just > because > we answered the phone. So support for a $3.49 web service must make > compromises somewhere in an attempt to reach profitability. > > I know of 3 very big ISPs - all barely making money for years. Providing > crummy service , priced cheaply and expecting to make it up in volume. > Their solution was to merge and lose money together. Still providing a > lowball price for service , they then took the profitable parts of the > business and sold those to others so they can re-org and improve cash > momentarily. The re-org produced the same low prices and crummy service. > So it's a cycle some people play just to win money from hedge funds, > investors and finally the public. What do they call it when one keeps > doing > the same thing over and over again expecting a different result ? > > Low priced services are difficult to make profitable - if you drove your > car > the way most low priced business services operate you would have a car > that > top speeds at the minimal freeway speed, wouldnt carry a a spare tire, > drive > around until the empty light turns on and carry as little insurance as > possible. - Gee, come to think of it, I've been in an airport shuttle van > like that in new york. > > Thank You > Bob Evans > CTO > > > > >> However, with thousands more users at that price point, you would >> think the income would be plenty for better services. >> >> Who makes more, the store with smaller quantities at higher prices or >> the store that sells more bulk at lower prices? Perception of value, I >> believe, wins. >> >> Robert >> >> On Wed, 25 Nov 2015 16:00:37 -0800 >> "Bob Evans" <b...@fiberinternetcenter.com> wrote: >>> Yes, I agree with you Joe - a hasty generalization, as "you get what >>>you pay for" doesn't really apply to as many goods in the same way it >>>does to almost all services. However, a $3.49 web site service should >>>have be a good first clue. >>> >>> Thank You >>> Bob Evans >>> CTO >>> >>> >>>> Walmart has cheap prices so "you get what you pay for."?? >>>> Hasty generalization but I can't disagree 100% with your opinion on >>>>this one. >>>> I am learning about the non-profit world of IT and the challenges >>>>are all around me. :) >>>> >>>> -- >>>> Later, Joe >>>> >>>> On Wed, Nov 25, 2015 at 12:27 PM, Bob Evans >>>><b...@fiberinternetcenter.com> >>>> wrote: >>>> >>>>> >>>>> Gee, for $3.49 for a website hosting per month , it's a real >>>>>bargain. >>>>> While the network person inside me says, Wow that's a long outage. >>>>>The >>>>> other part of me is really wondering what one thinks they can >>>>>really expect from a company that hosts a website for just $3.49 ? >>>>>Such a bargain at less than 1/2 the price of a single hot dog at a >>>>>baseball stadium per month. That price point alone tells you about >>>>>the setup and what you are agreeing too and who it's built for. >>>>>Goes along with the ol' >>>>> saying, "you get what you pay for." >>>>> >>>>> If they are down for 10 hours a month out of the average 720 hours >>>>>in a month - thats a tiny percentage 1-2 of the time it's >>>>>unavailable - in service terms of dollars it's roughly a nickel >>>>>they credit each customer. >>>>> Do I need more coffee or is my math wrong about a nickel for 10 >>>>>hours of website hosing ? >>>>> >>>>> However, maybe that is all many companies /sites really need. In >>>>>which case, it should be easy enough to build in backup yourself >>>>>using two cheap hosing providers and flip between them when the >>>>>need arises. Or pick a provider that manages their routing well and >>>>>works with you quickly, but, you'll have to pay more for that. >>>>> >>>>> Yep, the math spells it out - "you get what you pay for." >>>>> >>>>> Thank You >>>>> Bob Evans >>>>> CTO >>>>> >>>>> >>>>> > remember folks, redundancy is the savior of all f***ups. >>>>> > >>>>> > :) >>>>> > >>>>> > On Wed, Nov 25, 2015 at 2:21 PM, JoeSox <joe...@gmail.com> wrote: >>>>> > >>>>> >> I just waited 160 minutes for a tech call and the Bluehost tech >>>>>told >>>>> me >>>>> >> he >>>>> >> was able to confirm that it wasn't malicious activity that took >>>>>down >>>>> the >>>>> >> datacenter but rather it was caused by a "datacenter issue". >>>>> >> So my first thought is someone didn't design the topology >>>>>correctly >>>>> or >>>>> >> something. >>>>> >> Some of our emails are coming thru but Google DNS still lost all >>>>>of >>>>> our >>>>> >> DNS >>>>> >> zones which are hosted by Bluehost. >>>>> >> At least the #bluehostdown is fun to read :/ >>>>> >> -- >>>>> >> Later, Joe >>>>> >> >>>>> >> On Wed, Nov 25, 2015 at 10:04 AM, Stephane Bortzmeyer >>>>> >> <bortzme...@nic.fr> >>>>> >> wrote: >>>>> >> >>>>> >> > On Wed, Nov 25, 2015 at 08:41:55AM -0800, JoeSox >>>>> >> > <joe...@gmail.com> wrote a message of 9 lines which said: >>>>> >> > >>>>> >> > > Anyone have the scope on the outage for Bluehost? >>>>> >> > > https://twitter.com/search?q=%23bluehostdown&src=tyah >>>>> >> > >>>>> >> > The two name servers ns1.bluehost.com and ns2.bluehost.com are >>>>> awfully >>>>> >> > slow to respond: >>>>> >> > >>>>> >> > % check-soa -i picturemotion.com ns1.bluehost.com. >>>>> >> > 74.220.195.31: OK: 2012092007 (1382 ms) >>>>> >> > ns2.bluehost.com. >>>>> >> > 69.89.16.4: OK: 2012092007 (1388 ms) >>>>> >> > >>>>> >> > As a result, most clients timeout. >>>>> >> > >>>>> >> > May be a DoS against the name servers? >>>>> >> > >>>>> >> > bluehost.com itself is DNS-hosted on a completely different >>>>> >> > architecture. So it works fine. But the nginx Web site replies >>>>>502 >>>>> >> > Gateway timeout, probably overloaded by all the clients trying >>>>>to >>>>> get >>>>> >> > informed. >>>>> >> > >>>>> >> > The Twitter accounts of Bluehost do not distribute any useful >>>>> >> > information. >>>>> >> > >>>>> >> >>>>> > >>>>> >>>>> >> >> > > > >
