Hosting Industry Demystified

Is Your Web Host A Secret Reseller?

Web hosting resellers have been around for almost as long as the Web hosting business itself. In the beginning, Web hosting companies who had made large capital investments in servers and infrastructure began recruiting third-party companies as a type of commissioned sales force to help them recoup their investment faster. These third-party companies were given incentives to ‘resell’ hosting services with volume discounts, advanced technical support and private labeling that made the primary host completely transparent to the reseller’s customers. In general, the more hosting customers that a reseller can deliver for the primary host, the greater the discount the reseller receives and the more money they can make marking up the hosting service to end users. Interestingly enough, many of today’s large primary hosting companies actually began as resellers and later bought their own servers and added support staff by reinvesting their profits. View reliable web hosts under $10.

Today, there are thousands of resellers operating under their own brand names who would prefer that their hosting customers never know they are really reselling another company’s hosting services. Should you be concerned with whether your hosting company is a reseller? The answer is yes and no. Resellers can sometimes offer you more attentive and personalized support because they don’t have as many customers to deal with as the primary hosting company they are reselling for. Resellers also can offer value-added benefits to their customers by including other services in their hosting packages such as search engine promotion, Web design, database management and other Web-based applications. And even though resellers are acting as middlemen, their hosting packages may be priced as low as, or even lower, than the primary host’s retail hosting packages depending on the volume discount they receive and the margin they need.

The majority of resellers are legitimate businesses offering a good value to their hosting customers through an established and reliable primary hosting company. But just because the primary hosting company is reputable and trustworthy doesn’t automatically mean all of their resellers are. If for any reason a reseller can’t pay or chooses not to pay their hosting bills, they can be shutdown by their primary host with no warning to you. It’s also highly unlikely that you would have any recourse with the primary host (if you can even find out who they are) since your hosting contract is with the reseller. Resellers don’t have any real capital investment in equipment and infrastructure so it’s very easy for them to go out of business for any reason. They’ll just resurface tomorrow under a different name and start reselling hosting for another hosting company — leaving their existing customers with a pile of headaches and nobody to turn to for help.

So how do you know if you are dealing with a primary hosting company or a reseller? The first rule of thumb is to ask! A reputable reseller will most likely be honest and even tell you who their primary hosting company is. If the reseller is truly offering value for their hosting customers, their hosting packages should hold up even to direct comparisons with the primary host’s retail packages. But, if a reseller really doesn’t want anyone to know they are a reseller, it can be hard to know for sure. You could ask to visit their data center in person and see what they say. You can also try domain lookups, running trace routes or go into hosting forums for info on them.

The bottom line is that you need to very inquisitive and careful when choosing a reseller for a hosting company, just as you should with any new supplier with whom you are contemplating a contractual relationship. Regardless of whether your host is a reseller or not, the most important thing is that you reliably get the Web services you need for a fair market price. Make sure your host’s systems are redundant to avoid problems during peak periods and have uninterrupted power supplies in case of a power failure. Find out if their Internet connections offer the speed and bandwidth you need. And make absolutely sure that all of your data is backed up daily so if you ever have a problem, you can get up and running quickly with another hosting provider.

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