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Why VPS are so cheap here as compared to hostgator/site5/godaddy etc?
I know that VPS with GD, HG, and Site5 are managed, but prices are so high. Hostgator Semi-managed with
CPU
1 Core,
RAM
1 GB,
Disk Space
60 GB,
Bandwidth
1 TB
is @ $39.95/month without cPanel. Same plan with GD is for $32/month.
Site5 unmanaged plan with:
Cores:2, Memory: 1GB, Disk Space: 50 GB, Bandwidth: 800GB, is @ $25/month.
However @ LEB/LET we can get unmanaged VPS @ maximum of $7/month even with more resources.
So my question is that why is this huge difference in price?
(PS: Above prices and specs are for references only, I am not advertising anything)
Thanked by 1sz1hosting
Comments
because there ripp off lol also well established company's and big in the industry
Because providers selling you VPS for $7/month usually don't spend millions on marketing and advertising.
They're much larger and generally have better infrastructure in place than most hosts. Also as rds100 pointed out, most top-dogs spend a lot of money for advertisement.
These big companies value consistency and stability over raw peak performance. They probably don't use RAID10 SSDs but they are probably much more stable than most LEB providers.
Lower operating costs and infrastructure.
HostGator has lower operating costs when they exclusively use SoftLayer/ThePlanet for their dedicated servers and probably for their VPS and shared as well? I don't know about post-EIG-acquisition but I digress...
Probably most to do with customer naivity, pricing is relative to shared hosting rather than being valued on its own.
Plenty people on shared hosts lack technical experience and would not be familiar with sites like this, or running lots of boxes. Naive customer hears that VPS is better for performance and so pays $20 more a month but isn't comfortable moving away from their host... that kind of thing.
IIRC shared hosting in the early 2000's was going for $3-6 a month and could be paid for monthly, now they all want yearly to get the same kind of price/value. I imagine a lot of them paid a lot in time/money for the infrastructure in place to deal with shared hosting rather than the newer kid on the block. Along the same lines, the companies advertising here are young and built from scratch, without having to worry about an existing customer/code base.
GoDaddy and HostGator usually have noobs as their customers. They search "hosting" in google, and they are both in the top 3 results.
As well, the developer creating their site might just say to get hosting at ______ (their referral link) and they'll get extra profit from their work.
They don't oversell as much I guess, and they offer support..
When I first started reading LEB, I got the "too good to be true" feeling with a lot of offers, specifically with providers like CVPS and BlazeVPS. Maybe this only holds true for me, but if I was a small business owner, I'd probably feel the same.
After my experience with several hosts in the "lower-end" segment, I wouldn't trust many of them to host an important site.
Edit:
Customers are not naive to pay more to other providers; We (likely) don't know the operating costs beyond assumptions that larger hosting companies incur. I've actually considered bigger providers recently; Linode, AWS, and Google now have more competitive offerings. In my opinion, GoGrid was the best provider I've encountered; It's just difficult to justify the cost of using a service like that for personal sites.
Many people here are too heavily infested by the so called low end virus
, can't understand the nature of price and marketing in sales.
if the big name spent the money for advertising/marketing, I don't understand with DigitalOcean, the price and the commission for their refferal..
I always wondering, are the lEBs provider making profit? especially for RamNode, iwStack/Prometeous, Backupsy.. As long as I used to play with Hosting provider (I had played with HG, Site5 before knowing LET/LEB) IMAHO, I could say the support is great/same, they are even better if compared with those big name..
Simply because 99.9% providers at LET oversell beyond imagination.Those who don't(using KVM or XEN HVM) either choose very cheap,5 to 7 years old outdated hardware or either do it as a hobby without intention of earning much profit.If you have 100 vps on an E5, that is overselling in terms of ram & I/O as well, so don't think of overselling in terms of RAM or disk space only.
Note: I am not complaining & I do not think it is wrong to do it in LET market since I think it is kind of necessary to do it in this market.
Client acquisition costs are much higher for those companies than LEB companies.
I tried more than 12 LEB providers. Probably like 15 or more. They have different quality of their services and commitments, some of them are good and some of them are bad. But one thing I never noticed - which is "outdated and obsolete hardware". The minimum I had seen is 5520. I've seen delimeter with 5420 but that's still a good processor.
Can you explain more with examples? Just because they are LEB providers doesn't mean they are trying to feed you bullshit.
I can't support the quote: "the bigger the better".
In the past I personally had sites with Hostgator, and they don't really care about you as a customer. Why should they? They have 10,000's of them. You are only a number.
But the (good) LEB providers are happy about every new customer, and treats them like pure gold, because often they are, and they will do everything to keep them
Why are they so cheap? Yes, a lot are, but most of the time these extreme LEB providers haven't calculated every cost factor and have to close her business in the next few weeks to come. Or they simply are happy with a 1% profit rate.
I don't think they invest less money in the hardware. Sometimes the bigger companies are more experts in reducing quality (hardware, support, etc...)
I cannot give any examples because I do not like pointing fingers at anyone. L5520(4.5 years old) & L5420(5.5 years old) are also outdated processors, with very low passmarks.Using them as a dedicated server for low to medium usage should be fine but definitely not in a virtualized environment with several other users on it.
And even if someone is using an E5 with RAID 10 disks & putting 50-100 vps or even more than that then it is also over-allocating to the extreme, which proves my point.
Dual E5 + Large RAID 10 array with 50-100 VPS is not over-allocating to the extreme.
Even with that kind of setup I would say 50 is fine, not more than that.
Based on what? Where do you see the contention occurring?
I always run out of CPU before I can commit even 60% of my RAM, disk or network per server. (by run out, I mean I see less than 30%id (where I draw my line.)) Mind you, this is KVM with Windows guests; Windows guests are terrible on CPU usage.
Based on several years experience of working for different hosting companies(not working for anyone right now & none of them whom I have worked for were LEB providers), cpu usages, server loads, node stability & complaint tickets from clients.
Sorry, my 'based on' comment was a little ambiguous. I meant where did you see the biggest contention being.
Quotes, please. I'm interested too
You want to know the providers I have been working for or something else?
CPU & network both.But then I am one of those who are ready to pay a premium price for a good vps where I can use(not abuse) plenty of resources with freedom.So may be what I said based on my experience is just my own opinion only but that is really how I feel.
because they aren't run by 16 and 17 years olds
Also in addition to all the points above, the non LE providers have a lot of staff. A dedicated 24/7 support team. That sure adds to the cost.
In general it is more to do with reliablity.
And they'll probably not suspend you if you use your VPS and the load goes up.
VPS here are cheaper because:-
Some are run by 16 yr olds living at home and so have low outgoings (no rent/food/utility costs)
Some will not be paying ANY tax (you know who you are)
Some will be happy to make $2000 at the end of the month ie are happy to make a wage rather than work for someone else for the same money
Some do not provide any/little support
Some will not be here in a few months so it's a pump and dump scheme
Some don't care about the money, they like what they do.