Quote:
Originally Posted by TheDoc
So you assume a tube that size makes no money, so you would have to charge them a really low rate? Why think this and a bigger factor, why care?
Think about this.. If I ask you to host me and you say a price I don't like, because you have to make a profit, I will just go to a host that can give me my price or I will host with you.
You not making a profit, is your fault.. simple as that.
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EXACTLY MY POINT! The tube customers want the host to be a CHARITY.
My point is not that they are not making a profit, their margins are slim more than likely. I've heard time and again "I can't afford that, the tube doesn't make enough", etc.
The point is that they want HIGH END 16+ HDD servers for FREE, and want to pay MY COST on bandwidth (
which is the LOWEST available on the market). So if I don't want to be a charity and try to make a LITTLE bit, then like you just said. You will go else where to a host that does want to be a charity.
So the only reason I would accept them as a customer, is not because they are making me a DIRECT profit, but because their BW usage lowers my costs ELSEWHERE in the business where I can make a backend profit. However, if my COSTS are already as low as is available currently on the bandwidth market - I really give two flying shits if they sign up with me, because I make nothing on the front end or the back end of the business on the customer.
So the companies currently hosting these tube sites are benefiting from their bandwidth usage (thusly increasing their overall commitments), and possibly locking the tube sites into a 1 year contract at a rate that is higher than the newly negotiated rate they get too after adding on the new bandwidth; but once they reach the point where the MARKET for BW is at its lowest (an example $6/Megabit), and adding more bandwidth won't get you below $6/Megabit, then there is no further benefit to giving out free multiple $4,000 machines and BW at cost.