New Concept in Reseller Hosting – No Upfront Payment

This deals with the method of payments in the reseller hosting. Please note that it does not pertain to affiliate accounts but reseller account working under own brand name.

Old Concept.

The reseller would be charged with a monthly subscription for a particular usage of server resources. The parent host while showing generosities, should exercise control through following mechanisms:-

1. Fixing number of domains.
2. Charges to be paid by reseller on “allotted space” and not “used space” of his customers.

These mechanism had following disadvantages:-

1. These are invariably planned in a way that the reseller would need to run in a chain of continuously upgrading the account before he could reach some level of profit or immediately after reaching marginal profit levels.
2. The other option of keeping higher costs would also limit his marketing.
3. The reseller has to pay fixed amount irrespective of his growth ie number of customers.

** Overselling: Later a trend started where some of the hosting companies started allowing their resellers to oversell means they shall pay on “used space” and not what they allot to their customers.

This brought about tremendous downfall in prices and also caused to old companies to make hue and cry over “overselling” and confusing it with “over usage” (while both have different implications).

Later almost all hosting companies got into race of lower cost and exceptionally high offerings leaving very little for resellers or smaller companies to manipulate in this business thus ending up with.

New Concept

Lately the concept of reseller without any regular upfront payments have started ie the reseller pays nothing to start with, The billing mechanism is:-
1. The customer of the reseller pays to the reseller.
2. The reseller retains his share and pays to rest to the parent company.
3. Every thing done in a billing application ie automatically without hustles.
4. Complete branding and automation.

** Advantage
1. Reseller has nothing to loose here.
2. Unlike the first case he has to pay irrespective of the fact that he has some customer on his inventory or not.
3. Offering normally include domain names and few other applications to reseller like thus a wider scope of sale.

So free reseller offers are the name of the day now which shall sooner or later be replacing other method.

 

It is a new concept of hosting, yes.
I don't know what happen to the hosting world recently. It is possible to have billions of GB for 99 cents a year stuff.
I had my first site in 95. Best deal I could find was $9.99/month for 5Mb
My hosting today (but it's not "no upfront payment though ) is 20 bucks/year for 250Gb and 5,000Gb bandwidth.
And when I check the market out there, I've been ripped off

 

Your server is incredibly oversold to get a price like that. You're essentially paying $20 a year for an entire harddrive's worth of space for a year (so they lose money on the hardware), and I won't even get into the BW costs if you used all your bandwidth.

 

The concept above ie "no upfront payment" is not based on overselling. You pay when an accuont is sold not any downpayment for nothing.

 

None is sure but we can make pridictions.

 

The concept of this is overselling, yes. It is to make a good deal seem so good, more than the regular inflow of signups will occur. So, instead of 10 signups a day (depends of course), it would be 100+. That is the concept.

I support this overselling, but not for huge quotas such as that. Companies that sell that much doesn't mean they are a rip of your money, as it depends on the quality of the company. So, the best thing to do when looking at a hosting company (no matter what the deals are), best look at customer responses.

I am with SurpassHosting.com which fits under the oversell. The difference is, good overselling hosts know how to accommidate to the growth rates of other websites. Surpass, for example, will add more storage if needed, to accommidate the load on the server. The key to being a good overseller, is to upgrade when needed. The point of oversellin gis most people will not use their quotas they paid for (like me). The amounts are just a gimkic that, if the host is actually good, will be guarenteed.

Abit of a ramble, but i tall depends on the company in general. If everyone used their quotas up, I'm sure they'd be out of business.

 

On topic (which I using a 2nd post for), this form of reselling, I didn't find to be new? How new do you mean? Within the last 3-6 years? I've remembered many hosts giving setup ~ free services.

so, what type of reseller do you mean?