Something you should all read...

[Eriksrocks]

I thought this was a very interesting piece by the CEO and founder of HostGator, one of Bluehost's main competitors. HostGator recently updated its hosting plans to unlimited disk space and bandwidth, and this is his opinion on the matter.

http://blog.hostgator.com/2007/10/06/selling-out/

The reality is, I can guarantee you that Bluehost is doing the exact same thing. It's called overselling, and anyone who knows anything about webhosts knows that it happens almost everywhere. They restrict your account based on CPU and memory usage. You'll exceed those limits far before you'll actually run out of disk space or bandwidth, and that's why everybody is complaining about the fatal "CPU Quota Exceeded" message.

Whether you consider it shady or not is your opinion. It's interesting how he explained that he was essentially forced to join his competitors (e.g. Bluehost) or lose sales. Really shows the dark side of hosting competition these days.

It was interesting and refreshing to hear it explained from the inside. At least he was honest.

Opinions?

[felgall]

If you read Matt's blog he said the same sorts of thing long ago.

For most shared hosting needs 500Mb of space and 2Gb of bandwidth is no different from unlimited because most sites will not ever need any more than that. For bigger sites that offer files to download you might multiply those figures by 50 but even that is way below what most shared hosting providers have been offering for years.

CPU usage has always been the limiting factor for any shared hosting. It is spelt out clearly in their TOS but they don't tell you about it in their features list while trying to sell you on their hosting rather than their competitor's. That's called marketing - tell people the good features they get in the ad and leave the bad ones for the agreement that everyone reads before signing up.

BlueHost actually doubled the CPU limits earlier this year.

Since they move accounts from one server to another if a server even starts to look like it is about to get overloaded they are not overselling. Only when many of the accounts on a server all grow really rapidly all at once is there the possibility of a server actually becoming overloaded before they have time to move the sites and rectify it.

The limiting factor in a computer these days is the CPU and so the portion of the CPU that the host makes available to each account will determine the hosting price. Shared hosting is only so cheap because the CPU is shared between a few hundred accounts (some hosts which are overselling put thousands of accounts on one server). Where you want a larger portion of the CPU then you need to have fewer accounts on the same server. With 450 accounts on a server BlueHost brings in just over $3000 per month per server. To get 1/20th of the CPU instead of 1/450th you'd need to be paying around $155 per month for the hosting so that the hosting provider makes the same money.

Web hosts like HostGator cover the full range of hosting from shared through reseller through to dedicated where you get the entire server to yourself. Where someone outgrows the CPU of their shared plan by a small amount then they have an interest in keeping them around so that once they grow further to the point where they need dedicated hosting that they can offer it to them. BlueHost only offer shared hosting for sites at the bottom end of the CPU range and therefore have no reason to take a loss on sites that have outgrown their hosting plan since there is no bigger plan to try to move them to.

[Eriksrocks]

Totally agree with you, couldn't have said it better. I'm not trying to make Bluehost look bad or anything, just pointing out to people that complain about their CPU limits that this is the reality in shared hosting.

[Korr]

I signed up for these hosts before everyone went crazy with the unlimited thing, and all of my pre-purchase research indicated that CPU time was going to be the factor to watch.

Yet I still see people signing up on various forums to complain when they can't run a X0,000 visitor per day website on a $8/month web host!

The confusion might persist because its hard to get a handle on affiliate marketers and many of them may be short-sighted enough to mislead customers in order to maximize up front sales. Personally, I think its better to inform about the product as much as possible. I also think that the complaints about overselling are a little bit ridiculous. Overselling is efficient!!! In fact just a few weeks ago I wrote that shared hosting is just like fractional-reserve banking.

(ah heck, the .png isn't showing up in the forum post, see the picture and post here if you're interested in my crazy theories of hosting as banking)

Yeah, once in a while the system crashes. The rest of the time, you get more than you really paid for. With shared hosting, the system admins can find the offending accounts and alert the owners for a chance to fix it or move on to some other level of service. With banking, the consequences are a bit more serious - and we still use the fractional system in global banking its still better than not "over-lending."