Are you familiar with the concept of booking a plane ticket for a flight, then arriving at the airport and you are told that you cannot board the plane because it is full? How is this possible if you have booked and paid for your ticket?
Welcome to the world of excessive sales.
Everyone excels – from air travel companies to mobile operators. Overpayment is a business model where a company sells a resource more than it actually sells to a group of customers because they know that a large percentage of these customers will never use 100% of the resource.
For example: Airlines book their flights regularly because they know that not everyone will make the flight. In this way they can ensure that their flights are full regardless of the fact that a percentage of people will cancel or not arrive.
Cell phone companies outperform talk time – offering huge bundles of minutes talk time possible to customers at a very low price given that they know it is not humanly possible to use all those minutes that have spoken within a month. Why do they do that? It provides a very attractive and competitive package to potential customers (Wow! Look at how many minutes of my talk time I have, for very little dollars).
Over the past two years, the concept of oversold has started to appear in the hosting world. What does it mean to think you really get 350GB of hard disk space and 3000GB bandwidth for $ 5 per month?
Basically the overpayment of the hosting square is what makes you seem to get a really good deal – lots of hard disk space and bandwidth for a little money. Hosts know that an average website may not use more than about 150MB to 250MB of website hard disk space, so why should it offer 350GB? Can you really use the entire 350 GB?
First, they show it because it makes it stand out as exceptional value for money. They don’t always resist a good deal, or getting something for nothing in practice, although most people, in the back of their minds, know that if the offer is too good to be true to, it’s probably incorrect.
Let’s see if the hosting company can offer such huge packages and it’s still right.
- It is definitely true that not everyone will use all this space. Then the trick comes with calculating the odds and working with the averages. If they have a sufficient number of clients and have been working for a long time, they can soon determine the percentage of clients who tend to use the percentage of disk space. They can then assign their redundancy features based on these numbers.
- On the other hand, they should be prepared for the small percentage of customers who use the space. Someone may buy the package for off-site backups, or upload videos or large pictures. The host company should be ready for these customers and be able to provide them with space if they really need it. Therefore the hosting company needs to be able to increase the size of additional devices more quickly in the form of additional hard disk space or servers to meet this demand.
- Many hosting companies provide reseller services, selling a certain amount of hard disk space and resource bandwidth, then cutting resources into smaller packages and selling them again. The risk comes in the event that both the host parent company and the seller sell excessively! This can quickly lead to a shortage of resources and the customer will suffer.
- Most hosting companies, whether operating under the principle of excessive selling or not, have terms of service that govern how the account is used. This is to protect the web host from abuse and practices that could harm their business or infrastructure. This usually includes spam and illegal websites practices and what web space and bandwidth can use. Some web hosting providers do not allow streaming video, for example. These terms of service can help a web host to control the use of its infrastructure and can contribute to good packet management and customers using this infrastructure – whether or not they are in oversold.
Unfortunately, there is no way to know if a hosting company operates on a resale basis or not, unless you use your common sense regarding the prices offered. Over-selling in the hosting industry isn’t necessarily a bad thing, it’s just something you might want to be aware of when purchasing a hosting package. If your hosting provider is providing a good service, it monitors its server usage and is able to increase its resources when necessary – what more can you request?
If you are interested in over-selling, ask your hosting provider whether or not they have their own infrastructure – if they are resellers and offer massive packages you may want to be careful before registering.