The Joomla! Community Magazine™

Hosting: Awesome Revenue Stream or Big Headache?

Written by | Thursday, 31 May 2012 17:00 | Published in 2012 June
As web developers we have all dealt with the decision of how to best provide website hosting for our clients. It can be a great source of passive income if you make the right decisions or it can be your worst nightmare losing you precious time and coveted client relationships. In this article we will analyze the different hosting methodologies and what to look out for to make sure a hosting company is the right fit for your business.

Affiliate Model: Profitability: Lowest | Server Experience Needed: Low

The affiliate model has the lowest risk but also the lowest profitability. You simply choose your preferred host, sign up for their affiliate program and each client you refer to them you receive a percentage of the sale. You or your client then will deal directly with the hosting company for support or billing.

Pros:

  • Support and server management is provided by the host
  • No need to deal with billing

Cons:

  • Minimal control over hosting environment
  • If the client has a bad experience with host it will reflect on you
  • Low profitability

Reseller Model: Profitability: Medium | Server Experience Needed: Low

The reseller model allows you to add more profitability without the need of server management. You simply buy a block of websites that you pay monthly for and resell them to your clients at whatever profit you see best fit.

Pros:

  • Increased profitability
  • More control over individual accounts
  • Server is still managed by host

Cons:

  • Support will fall on your shoulders
  • Billing is handled by you
  • Minimal control over hosting environment

Server Model: Profitability: Highest | Server Experience Needed: Medium to High

The server model provides the highest profitability but also requires a vast knowledge of servers and resources to maintain them. The server model can range from going through a hosting company for a dedicated or virtual private server or renting / buying your own equipment at a data center. Many growing businesses end up up in this model without a host that is the right fit or the proper knowledge. This will typically result in disaster through hacked websites or data loss so proceed with caution.

Pros:

  • Potential for best profitability
  • Complete control over hosting environment for advanced capabilities
  • Potential greater efficiency for staff

Cons:

  • Management of server will mostly fall on you
  • Support will fall on your shoulders
  • Billing is handled by you

Some important questions to ask a potential host:

  • Is your support phone and /or ticket based?
  • What are supports hours of operation?
  • If phone support is provided will I receive senior level support if needed right away or will I have to schedule a ticket for a higher level of support?
  • Is your support based in the country you live in?
  • What kind of credentials does your first tier and senior level staff have?
  • If VPS or Dedicated Server: What does your managed services included simple upgrades, tech support, proactive management, etc. This is very important to match to your knowledge level as you don’t want to be stuck trying to accomplish something you have no knowledge in.
  • How many days of backup do you provide?
  • Do you charge for restoration of these backups?
  • Are backups stored on the same server?
  • Are backup stored in the same data center or a different one?
  • If VPS or Dedicated: Are backups site or machine level backups?
  • Are there any secondary backups in place?
  • What kind of uptime do you guarantee?
  • Is your hosting truly geared specifically for a Joomla environment?
  • Is your support staff truly highly knowledgeable in Joomla!?
  • How are they trained to stay on top of Joomla!?
  • For shared hosting: How are SSL certificates handled? Will my site get its own IP address or will I have a separate IP address for the certificate?
  • What city / facility are your servers hosted in?
  • What kind of hosting management tools do you offer? I.E. CPanel, Plesk etc.
  • What kind of security measures do you take to ensure a safe hosting environment? Make sure to do your homework here to know what a good response.
  • Can I host my own DNS or do I need to use yours?

Be sure to thoroughly do your homework to find a host and model that is a good fit for your skillset. It will take you far less time to do thorough research now rather than switch models or hosts later. Also remember that more than anything with hosting you get what you pay for.

Hosting can be an excellent additional passive revenue stream for your business. If it is done properly and expectations are realistically set with your client you can have a successful hosting program. If not expect angry clients and lots of stress.

What other tips or experiences have you had?

*Please refrain from bashing hosts. Comments will be moderated.

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Gabe Wahhab

Gabe Wahhab

Hi, I’m Gabe, an entrepreneur and owner of Savvy Panda a Joomla Web Design & Inbound Marketing firm in Milwaukee, WI. I also own jInbound and Master Inbound. I am the editor of the Business Matters section of the Joomla! Community Magazine and am a Co-Founder of Joomla! Day Midwest and the Milwaukee Joomla! Users Group.

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