Website Hosting: Explicit Time, Explicit Space

Most website hosting companies operate on an explicit time and explicit space basis. Due the to medium that most customers use to find a host (the internet), it is very easy to compare prices between companies. Some hosts have tried to package their offerings together now as a way to counter the increased clarity of pricing, or have added additional benefits that they believe to be valuable to their customers. Depending on the client, in addition to the value of space given for the price, benefits such as close to 100% network uptime, a dedicated vs shared server, email addresses, and customer support will also play a role in the ultimate package chosen. Customers are traditionally renting this server space for a fixed amount of time – usually monthly, though discounts might be given for renting for a longer amount of time. From the host’s perspective, if their server space goes unused, that is money left on the table. Website hosts can generally add some additional server space at not much cost, but generally won’t keep buying/selling servers to match customer demand (in part because of higher costs to refit the entire system to keep up with increased bandwidth, etc). Below are four examples of website hosts, each using a slightly different model to attract customers.

Network Solutions uses a traditional package approach. Offering three main packages, customers can choose between the amount of disk space, monthly data transfer, FTP accounts, and e-mailboxes. Packages range between $9.96 and $29.13 monthly and come with a free domain, with an annual contract. Prices go up a few dollars per month without the annual contract.

GoDaddy is another popular website host provider. Here, their pricing is focused on the amount of disk space, monthly data transfer, number of email addresses, total email storage, and a few smaller items (no long term contract required). While GoDaddy’s initial prices appear cheap at $4.29-$14.99 per month, this doesn’t include much more than the bare minimum. Like RyanAir’s approach to airline pricing, GoDaddy includes the minimum at a low price and charges customers for any add-ons that they require (such as domain registration/renewals).

Geocities (owned by Yahoo) is a website provider geared more to the beginner designer. Unlike Network Solutions and GoDaddy, you are not provided with a set amount of space to do whatever you please with as much as you are given space to create a personal website on. Prices range from $0 to $8.95 monthly, and vary based on domain name personalization, bandwidth, ad-support, and disk space. Whereas GoDaddy offered 150GB and 1,500GB monthly data transfer for $6.99, Geocities charges $8.95 for only 2GB and 100GB. The free version of Geocities generates revenues instead by ads placed on the customers’ website and is not meant for a very intensive site.

For small businesses, Geocities offers Yahoo! Web Hosting. For $11.95 per month (3-month minimum), customers are given unlimited disk space, data transfer, and email storage. I kept looking for the fine print, but really couldn’t find any. Ultimately, this must be an ancillary service that Yahoo provides its business customers, or is used as a way to introduce businesses to the Yahoo brand. Unlike other hosts, Yahoo has increased their liability by guaranteeing to all customers that they can have as much space as they like. There is a disclaimer that customers might be limited by the speed of their growth, and I’m sure this is to allow time for Yahoo to buy the additional servers needed. At a mere $11.95 per month, I can’t imagine that Yahoo’s shift to unlimited space can be profitable on its own. For any businesses out there, however, this is a really great deal!

Homestead uses a more Explicit Time/Implicit Space model for their website hosting. Much like Geocities, Homestead uses the approach that customers will be using the space for websites instead of giving them free reign. Homestead charges customers for their website-building software, which allows tech-challenged users to drag-and-drop and click their way through a five-page website. The service is free for the first month and $4.99 monthly after that. While space is obviously limited by the mere five-page limit, the space granted is now implicit due to the new focus of the monthly fee: the design service.