Is starting a web hosting business worth it?

DarthHazard Level 1

July 10, 2017, 10:25 am

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Is starting a web hosting business worth it?

I've noticed that a lot of people have been starting there very own web hosting sites recently. But the problem is that the market is already saturated with so many sites that obviously competition is going to be extremely high. Because of this you usually have to lower prices drastically or offer special offers that could hurt your profits. The biggest issue is that there are hundreds of well known web hosts which the majority of people will go to. This means most of the time you can only attract a few small customers that may move after a while. So why are people starting their own web hosting business and is it worth it anymore?

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vinaya

vinaya

If you scrutinize every online niche, you will find there are already hundreds of thousands of people already doing business in that particular niche. There is no niche that has not been touched. Therefore, you can do business in any niche. However, you have to think wisely. For instance, if you want to do web hosting business, you will have to come up with different marketing tactics and try to target the customers properly. Since there are already big players in the hosting business, you can do this differently by trying to attract local customers.
Market is saturated does not mean, you cannot work on that area. When the world wide web is saturated on a particular niche, you will need to work hard.

7 years ago

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overcast

overcast

If you have some spare money which you want to invest then sure. If you want to lose that money then even fine. But the thing is that if you wish to make money from hosting business. Then I am guessing it's lot harder than you think. It's not going to be any easy from here onward. And many business collapsing in this industry can show you why is it so. Learn from other hosts strategies.

7 years ago

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vinaya

vinaya

Any niche you can think of is already saturated, whether it is web hosting business, online store, even blogging. You can find blogs on every topics you can imagine. You can find all kinds of online stores. However, this does not mean, you avoid doing it. It is true that web hosting business is saturated. There are big players in the market and it is difficult to compete with them. No one will buy from a new business when there are already trusted sellers. However, if you develop a marketing plan and target people who are still new to website business, there is money to be made.

7 years ago

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overcast

overcast

The thing is unless you are getting cheap hosting packages for top notch support like OVH and Vultur and kimsufi. You are not going to be in demand. And that reduces your chances of the earning money. So your data center and the reseller account needs to be properly thought out. I have seen people using the top data centers and that helps them retain the customers.

7 years ago

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vinaya

vinaya

That's true. When the market is already glutted with cheap hosting from reputed hosting companies, a new hosting company can hardly survice. Namecheap offers shared hosting for $9.88 for the first year. This is less than $1 a month to host three websites. A new hosting does not have this kind of luxury.

7 years ago

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overcast

overcast

Yes. I think bundling the services seems to be the only way for that reason. i guess if the people locally are approached through that it'd be surely something to consider. I am sure there are plenty of people who bundle service. And that is making them money.

7 years ago

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vinaya

vinaya

Combining hosting services along with other services such as website development, marketing, SEO etc. can be one of the ways to promote your hosting business. Another way to approach the customers is by targeting the locals. In my town there are not many hosting companies. If I want to launch a hosting business, I will have to market it to the locals.

7 years ago

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overcast

overcast

These days some of the hosts like the kinsta are scamming people with view based plans. And you can find that it is driving people away from the hosts such as that. I'd say you can take this as an opportunity. And target that market.

7 years ago

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vinaya

vinaya

Thanks for the advice. Currently, I am paying around $6 per month for hosting service. My host provides reseller hosting for $16 a month. If I choose to become a reseller of this company I have to pay extra $10, by paying extra $10, I will be able to sell 25 hosting accounts. I am thinking about becoming a reseller host.

7 years ago

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overcast

overcast

Not sure how does that plan works. I know few reseller sites where you pay 20$ per month for your own account. And you can have as many accounts as you want for the sales. Only cpanel costs will add up.

7 years ago

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vinaya

vinaya

I also don't know how this works. The idea I have is just a basic idea. Since I am already paying for hosting my website, I thought paying more and selling hosting will not only generate me money but also lower my hosting cost (for my website).

7 years ago

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overcast

overcast

It is a good idea. But it may cost a lot if you don't get the clients. So you have to go out and hire someone to get you leads. And that's kind of difficult. I'd say on that note you have to find worthy business.

7 years ago

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vinaya

vinaya

I have been dilly dallying this project for a long time and I am not launching my business until I am sure about having a few customers. I am interested in this business not because there is a lot of money to be made, I want to do this business because I have a lot of websites and if I manage to sell few hosting accounts, I will be able to recover hosting cost for my websites.

7 years ago

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overcast

overcast

I think if the business today handled on terms of cashflow then they can be worth it. And you can easily manage them. But in real world it does not work like that. And it turned out to be lot slower too.

7 years ago

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Tronia

Tronia

I think that you will have a very hard time establishing yourself and your business. Web hosting is particularly over-saturated with different offers... so you have very big competitors AND the free hosting sites which will always decrease your traffic.

Unless you are prepared to work your booty off and you are EXTREMELY knowledgeable in this area, have good connections already established and so on, then don't go into it. You will also need quite some money for advertising and campaign to even get noticed.

7 years ago

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galegatling

galegatling

It really depends on what your best niches are. I mean for instance, you can make a forum about a certain concept which you think are not very popular and populate it with another popular contents. Such as tech forum with health and fitness on it, or music or gaming, or you can have all. In that way, people will feel that they always have a category which they will belong.

7 years ago

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mcbryan080990

mcbryan080990

Well if you have budget i advice that you should upgrade because everyone now has internet access and most people already aware of online transaction and services. Maybe it will cost you but i assure its worth it because aside from it will attract potential customer it easy way it will double your income because everyone can access your website all over the world. Imagine how website works in different countries. It makes distance possible. If you don't have knowledge about web hosting your business you can watch tutorial on different platform like Youtube or other open source tutorial website. It is important that your ready too and have the knowledge before you start in web hosting your business.

7 years ago

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hermessantos

hermessantos

Overall, I think this type of service only makes up for you if you do a website development job for your clients and also offer hosting.

I find it difficult to compete with big companies like godaddy, hostgator, among others.

So when you create a website for a client, you can recommend it to your hosting with the advantage that the support will be included. If he opts for a private hosting, he is the one who should have the job of contacting the company when necessary. I think this might work well for website developers.

7 years ago

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keen2write

keen2write

Depends, If your wanting to do this kind of thing I suggest try get a few members first who would join you.
You don't want to dive in and purchase the whole reseller accounts and to then see nobody is interested it your services. Well that is my though on it anyway. Try find members who would join and buy your hosting is the best bet.

7 years ago

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PedroP

PedroP

Yeah, pretty most every niche out there is saturated. Unless you are a pioneer and come up with something way different than what's already there you will face some competition naturally. The main idea is to think of how you can provide something new within a niche and how to provide a quality service while keeping costs and revenue balanced.

7 years ago

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hermessantos

hermessantos

I think there are still opportunities for this area of action. However, much caution is needed. You definitely need to deliver more than your competitors already deliver.

7 years ago

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itommy

itommy

Yes of course, joining web hosting field is still have opportunities to get benefit from this industry but to be honest you will have to compete with big hosting companies to get clients for your hosting services. I saw more hosting companies appeared but disappeared later because they could not get clients for their sites.

7 years ago

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zeedollar

zeedollar

Trying to compete with big companies like 1and1, godaddy and bluehost who send around $50m a year just on advertising is really a neckbreaker. But if you have a good promotion strategy that can get you clients in no time, then i suggest you go for it. But always make sure your services match those big guns when it comes to support and uptime, unless you will just be shooting your self on the foot.

7 years ago

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whatareyou420

whatareyou420

If you've got a bunch of money, sure...you might be able to make some money. Keep in mind that running a website can be quite expensive if you expect to get serious traffic. If you want to be a web host that makes a profit, that's going to cost you even more and it'll take time to get people signing up. You better have pretty stellar service from the start because you won't being going very far if you get bad reviews early.

7 years ago

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coolavender

coolavender

I think you can give it a shot but don't spend too much hoping to be in the leagues of biggies in web hosting like GoDaddy, Namecheap, bluehost, or hostgator. There are many bloggers who simply want to take their blogs to the next level but won't be that big enough to warrant moving to known web hosts.

The truth is these web hosts give jaw dropping discounts on the first term to attract sign ups. The rates go dramatically up come renewal time. To lock the discounted rates, they will entice people to sign up for three years hosting. That can be too much for people who may just be in the process of getting their fingers wet in self-hosting.

On the other hand, if they settle for a one year plan, they may not be able to afford the renewal which means that all their efforts for the first year would have gone to waste. This is where the other players come in. Many of them offer rates that are not bound to change during renewal and that can be a big come on for someone who's testing the waters but sees some potential in starting a blog or a website.

7 years ago

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ajlancer

ajlancer

HI there thanks for showing a nice point for hosting business. Yes! I agree to your described. The market is competitive and each and every business has lot of competition not only for web hosting business but also all. Despite of people take initiative for starting his own business. If you opt to start web hosting, you can and it is really worth if your luck very well. Rather, I can tell you, for start resell hosting business in locally. I have seen my one of friend doing business for web hosting and reselling. And last 7-8 years he doing same business and he has lot of clients. And I guess by selling resale service he earning much money each month and years as charging extra fee. That is risk free at all.

Regards by Ajlancer

7 years ago

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kgord

kgord

I would think you would have to be very technically savvy to do something like this. I am sure this is something that sounds good on paper but may not be worth it in the long run. I would think about it strongly before committing.

7 years ago

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zackd

zackd

I'm sure if you have a ton of money to invest and spend on building the company then yes but if not, you'll be eaten alive by other big companies that are cheaper and have more volume.

7 years ago

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zackd

zackd

I personally was thinking about doing this then pulled out because my friend who did it and was a failure told me unless I have 10's of thousands of dollars to invest then it's not worth it.

7 years ago

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Soulwatcher

Soulwatcher

Take this from a person who lost over $1200+ in the early 2000's trying to break into the hosting business. Don't waste your time or money, the market is way over saturated and web hosting companies are failing by the day. If you want to throw your money away by all means go ahead and try it.

7 years ago

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Corzhens

Corzhens

I think you need ample technical knowledge to handle a web hosting service because you will be dealing with servers and bandwidth. One of the foremost consideration in a web hosting business is the capital for buying high efficiency servers that I think you cannot operate with only 1 server because running for 24/7 requires a backup. I cannot say if it is profitable but you can definitely earn if you will have lots of clients.

6 years ago

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