The Alpha Red thread, a *MUST* read.

[Klen]

Originally Posted by Ycaza

Just sayin hi, and if we are all truthful, I am glad to see them go, its impossible to compete with them and offer good service.

Yeah i dont understood how the fuck they can offer 100 mbit for only 400$ monthly.I noticed they patch that with expensive cpanel fee and expensive managment but what when someone take only server and nothing else.

[Quagmire]

Originally Posted by Sin_Vraal

Bottom Line: If your a cheap ass bastard, get Cheap ass hosting. If you want quality hosting go get premium hosting. $4 and sub $4 IS possible , it IS profitable and a successful business model WAS implemented (Alpha Red)

To be honest, my first thought when seeing the lawsuit article yesterday was that they went down that road to prop up a 'below cost' business model.

So would you say that this scareware fiasco is due to greed rather than necessity?

I'm just looking for honest opinion here and wondering if I was the only one thinking that...

[Techie Media]

Originally Posted by txl;[/IMG

The only place for qualuty[sic] hosting is with techiemedia.

There are several Quality Hosts out there, but thanks Dave for your props.

[Juicy D. Links]

Originally Posted by Techie Media

There are several Quality Hosts out there, but thanks Dave for your props.

Jimmmmmmmmmmmmm blackjack!!!!!!!!!!!!!!!!!!!!!!!!!!!!

[Juicy D. Links]

I sale BW for 2.99 hit me for masssive pipes

[Spudstr]

We sell bandwidth for 6/Mbps, sometimes sub 6/Mbps. But we also charge a flat box fee as well.. All our plans as of recent are this model. Weather its premium network @ 20-25/mbps or value at 6-8/mbps with a 30Mbps minimum commit.

As far as whoever said using quality hardware, every and every box we sell is a dell 1950 or dell 2950 OR an ibm x3350. Occasionally we'll do supermicros but still supermicro brand motherboards and not desktop systems.

We run dual cisco 6509's with sup720-3bxls and have a full 10GE network to our distribution stacks. Even with the couple hundred machines we have in our network and the prices we do offer, we run a great operation with a handful of techs and are profitable. Going from a single gigE and 10/100 connection when we started to 20Gbps of connectivity now and pushing over 3Gbps in just under 3 years with practicably no debt is amazing growth.

I have always been on the boards and willing to help customers or anyone and give a hand or have a tech help someone out. We might not have been around for 10 years but we have been around for a few and are a well kept secret.

I encourage any other owner, from natnet, mojo, choopa, webair or whoever feels free to contact me. We are not going anywhere and don't plan on going anywhere anytime soon. My door is always open and my office is 703-579-4501 or I can be reached on my icq number below.

[Juicy D. Links]

Cisco 6509's give me a hardon

[ladida]

Don't know much about hosting, but Vraal's post is spot on. Alpha didn't fall because of beeing cheap, but beacuse of microsoft. Choopa is selling low for years now, and they control huge amounts of bandwidth. Are they dicks, i dont know, same as i don't know are any of you other here, but saying it's not possible is stupid.
This thread is not your best move Brad. You said they bring it, some people brought it, you didn't reply... Just makes you look jealous..

[Techie Media]

Originally Posted by Juicy D. Links

Jimmmmmmmmmmmmm blackjack!!!!!!!!!!!!!!!!!!!!!!!!!!!!

JUICY !!!!!!! I was in Atlantic City (Harrahas) last weekend for 3 nights with the mrs. Will be going again in1 or 2 weeks. You need to come in yo

[Brad Mitchell]

Originally Posted by Sin_Vraal

You know to be honest, every host here knows Alpha Red didnt fail b/c of low prices.

Actually Sin this is fundamentally where you and everyone else, including most hosts even, are out of the know.

Brad

[dubsix]

Originally Posted by Brad Mitchell

Actually Sin this is fundamentally where you and everyone else, including most hosts even, are out of the know.

Brad

THey weren't paying their bills, they were NOT massively profitable.

Brad, thanks for continuing to be a "beacon of sense"

[montel]

Originally Posted by Enemator

why not, there are plenty of customers that need help!

[Snake Doctor]

Don't you just love the implication that you somehow don't care about your business unless you pay 3 times more for hosting?

I always thought good businessmen did whatever they could to cut expenses. Some of us have been in the biz a long time and know the difference between a good host and a bad one, a fast server that's properly configured and a slow as shit one that isn't......I've had bad experiences with expensive hosts and great experiences with cheap ones.....price was never the factor that determined how good a host was.

I guess when you insist on having such a high margin in your business you have to justify it somehow, and I guess the way to justify it is to say the other side is skimping on something or won't be around very long.

Funny though, I remember the mom and pop hardware stores and other retailers saying the same thing when Wal-Mart moved to town. Wal-Mart was retailing items for less than the wholesale cost of the small stores.....and they complained and complained and said sure they may be cheap but it won't last because it's below cost, and nobody who works there can help you with questions about complicated products......but Wal-Mart still thrives and those old mom and pop stores are now boarded up vacant buildings.

[zentz]

i have a couple of servers on natnet one of the most expensive hosts around and 1 server on alphared. on alphared i host streaming videos for my tube site and i am so far happy with this combo.

i would never host my main domains/sites on alphared but i think this combo work pretty well.

[NoWhErE]

Originally Posted by Snake Doctor

Don't you just love the implication that you somehow don't care about your business unless you pay 3 times more for hosting?

I always thought good businessmen did whatever they could to cut expenses. Some of us have been in the biz a long time and know the difference between a good host and a bad one, a fast server that's properly configured and a slow as shit one that isn't......I've had bad experiences with expensive hosts and great experiences with cheap ones.....price was never the factor that determined how good a host was.

I guess when you insist on having such a high margin in your business you have to justify it somehow, and I guess the way to justify it is to say the other side is skimping on something or won't be around very long.

Funny though, I remember the mom and pop hardware stores and other retailers saying the same thing when Wal-Mart moved to town. Wal-Mart was retailing items for less than the wholesale cost of the small stores.....and they complained and complained and said sure they may be cheap but it won't last because it's below cost, and nobody who works there can help you with questions about complicated products......but Wal-Mart still thrives and those old mom and pop stores are now boarded up vacant buildings.

[GTS Mark]

Originally Posted by zentz

i have a couple of servers on natnet one of the most expensive hosts around and 1 server on alphared. on alphared i host streaming videos for my tube site and i am so far happy with this combo.

i would never host my main domains/sites on alphared but i think this combo work pretty well.

That is what i recommend as well to our publisher's that are setting up tube sites. Buy some cheap ass hosting for your movies and then host your pages on a quality host.

[pstation]

fwis, cogent sells bandwidth as cheap as $4/megabit http://telephonyonline.com/mag/telec...t_throws_down/

when you factor in that they bill using 90th percentile and every customer wont be utilizing 100% of their pipe 24/7, there definitely is room for profit to be made. at least from the view I see it at.

[HorseShit]

I would like to be contacted on icq Brad

[webmasterchecks]

Originally Posted by Sin_Vraal

You know to be honest, every host here knows Alpha Red didnt fail b/c of low prices. Everyone here can live up to the fact that

A) They were rocking hosting like nobody else.

B) If people cared, then they'd not host there. People apparently DID like Alpha red, b/c despite all the name calling they pushed some serious traffic. If the service was bad, it wasnt nearly bad enough was it, cuz if it was. people wouldnt be hosting there.

C) James was a dumbass and fucked his business with Scareware. Low prices didnt. I suspect he was making a dime or two , otherwise microsoft wouldnt have taken the time to beat him like a red headed step child.

D) Everyone who has posted in these threads are vultures (myself included). Posting under the pretense of giving advice while 'nice' is really self serving.

And for the record, Dave is a dick. Judging from the only time I met you Brad your kinda cool, and you do your clients a great service. but in this thread your sounding like a dick too, and Dave is right.


Bottom Line: If your a cheap ass bastard, get Cheap ass hosting. If you want quality hosting go get premium hosting. $4 and sub $4 IS possible , it IS profitable and a successful business model WAS implemented (Alpha Red)


EVERY SERIOUS HOSTER KNOWS THIS PRICING IS INEVITABLE. People said the Sky was falling when Cogent came out. Yet we are all still here dragging our sorry ass feet peddling bandwidth for pennies when we used to sell it for 1000/mbit.

great post. 11 years ago it was 1000/meg, 7 years ago it was 600 a meg, 3 years ago it was 180 a meg, now people selling at $20/meg are "overpriced", does anyone need a chart to predict where its heading?

[Sin_Vraal]

Originally Posted by Quagmire

To be honest, my first thought when seeing the lawsuit article yesterday was that they went down that road to prop up a 'below cost' business model.

So would you say that this scareware fiasco is due to greed rather than necessity?

I'm just looking for honest opinion here and wondering if I was the only one thinking that...

Yea I think Greed definately plays into it. Its not like he was the only person who can sell at 4/mbit, he was merely one of the few people willing to sell at 4/mbit.

When Cogent first came out, I dropped my prices from 450/mbit to 60/mbit. I went from pushing 300mbps making 150/mbit to pushing 3gbps making 50/mbit. Meanwhile everyone else spouted doomsday prophesies about cogent etc till they jumped on the bandwagon.

AR similarly took advantage of the recent changes in the market and kicked ass.

I'm sure he was supplementing AR with scareware dollars to some degree... But then again most of the hosts here have something similar going on (not illegal operations part lol) like side business , someone to fund them, extremely large customer paying above market rate, etc. It helped their business along , but it didnt make it.

[SpeakEasy]

Originally Posted by zentz

i have a couple of servers on natnet one of the most expensive hosts around and 1 server on alphared. on alphared i host streaming videos for my tube site and i am so far happy with this combo.

i would never host my main domains/sites on alphared but i think this combo work pretty well.

How's that working out for you during those 8 hour downtimes?

[Sin_Vraal]

Originally Posted by Brad Mitchell

Actually Sin this is fundamentally where you and everyone else, including most hosts even, are out of the know.

Brad

Brad,

This is Henry from Swift BTW, I dont want you to feel that Im trying to take advantage of you anonymously.

I appreciate what you're trying to do BTW, but we are not a cartel like the phone company is. I'm not trying to de-rail your thread, but if we are gonna swarm AR like vultures lets at least call it like it is. Its a feeding frenzy and everyone wants some of it. Lets at least give them the credit they were due for building such a massive book of business. They didn't fail b/c their business wasn't sound. they failed b/c he was selling scareware! Everyone knows not to fuck with with Microsoft, so why did he do it?

Lets suppose Alpha made $1/mbit which I'm absolutely sure they did. They were pushing 200+ gigs / second.

That gives them 200k / mo MINIMUM to play with. (NET EARNING)

now let me suppose I had their bandwidth biz.

I have 45,000 Square feet of US based office and datacenter. Even if selling bandwidth was the ONLY thing I did, and I didnt sell small dedicated servers, colocation, and consulting services. I would only be slightly in the hole each month.

I DO sell other things b/s high bandwidth servers however (just as alpha red does, and indeed EVERY other host here does)

the bandwidth I give away free (which I currently do) to my colocation clients for instance (Colocation is a term for someone who just buys rack space in your datacenter, and puts their own servers there, and manages it themselves), allows me to acquire thousands of cabinets all paying me a minimum of 800-1000 dollars per cab.

and ofcourse the 1000's of little dedicated servers that use zero bandwidth really, and net you 100/mo.

I also sell PREMIUM network services. I have a bad ass full mesh network consisting THE BEST providers on the planet click here if you dont believe me. I make good money from that as well. Leveraging that kind of buying power would lower the costs on my premium network dramatically I'm sure.


If I had their bandwidth business, at the end of the day I'd be making coin off of alphared's business. Its called Economies of scale

If my biz would make money, then I'm sure AR's biz would be too.

You have your servers at Equinix. Alpha Red has/had/whatever their own datacenters I believe yes? Most of the truly large hosts do. Basically their colo costs are a 10th of your own. You have to be able to put up Millions up front, but essentially once you can, your colo isnt that bad.


This is where fundementally I AM in the know.

If any of the hosts here want off this roller coaster (cheap OR premium hosts), I would love to chat with you about acquiring your business. ICQ in the sig. or contact henry at swiftco

[sandman!]

Originally Posted by SpeakEasy

How's that working out for you during those 8 hour downtimes?

what 8 hour downtimes ?

[Sin_Vraal]

Originally Posted by SpeakEasy

How's that working out for you during those 8 hour downtimes?

You know, I said the same thing to one of my friends. MANY times actually (downtime isn't a rare thing there), and you know what he said?

"Even if I'm down I still save more money hosting there than I do with you, paying your higher rate"

I didn't really have much to say after that.

[Sin_Vraal]

Originally Posted by WireSix-Ryan

THey weren't paying their bills, they were NOT massively profitable.

Brad, thanks for continuing to be a "beacon of sense"

I'm SURE their profit margin was absolute SHIT, but I'm betting the amount of profit they DID do overshadowed most of the hosts here.

Would you rather be, hey look I'm wicked profitable, I make 50% profit margin off my 500k gross / year company or would you rather be hey look I'm making billions this year off of my company that has 2-5% profit margin?

I'd REALLY love to know what they actually net each month, that would be VERY telling.

Think I'm lying? Go look at Grocery stores, Boeing , oil companies etc.

[borked]

A very eye opening thread all around.

[SpeakEasy]

Originally Posted by Sin_Vraal

You know, I said the same thing to one of my friends. MANY times actually (downtime isn't a rare thing there), and you know what he said?

"Even if I'm down I still save more money hosting there than I do with you, paying your higher rate"

I didn't really have much to say after that.

LMAO dude I was referring to the natnet downtimes ...

[Moose]

Originally Posted by Sin_Vraal

Originally Posted by WireSix-Ryan
THey weren't paying their bills, they were NOT massively profitable.

Brad, thanks for continuing to be a "beacon of sense"

__________________________________________________ ________________

I'm SURE their profit margin was absolute SHIT, but I'm betting the amount of profit they DID do overshadowed most of the hosts here.

Would you rather be, hey look I'm wicked profitable, I make 50% profit margin off my 500k gross / year company or would you rather be hey look I'm making billions this year off of my company that has 2-5% profit margin?

I'd REALLY love to know what they actually net each month, that would be VERY telling.

Think I'm lying? Go look at Grocery stores, Boeing , oil companies etc.

I'm not sure if you are blind or just don't understand. Ryan is obviously in the know as many others are. But slowdown and reread what he posted.

[sandman!]

Originally Posted by WireSix-Ryan

THey weren't paying their bills, they were NOT massively profitable.

Brad, thanks for continuing to be a "beacon of sense"

you magically have access to the alphared books ?

[Brad Mitchell]

There are so many false and inaccurate assumptions in this thread on every level from so many different people. Henry, I appreciate your taking the time to share more information with everyone here. Fundamentally, what you are talking about in generalities is true. However, the business and economics get tremendously more granular, even with great economies of scale. It is clear that I am misunderstood by several on many levels and that is understandable. I think next week more will come to light. I am hopeful to have the time to do a bit of writing for the board here, for everyone's benefit.

Enjoy your weekend everyone

Brad

[Sin_Vraal]

Originally Posted by Moose

I'm not sure if you are blind or just don't understand. Ryan is obviously in the know as many others are. But slowdown and reread what he posted.

Yes, I am aware their have been bill paying issue.s However consider how long they have been in business. They must have been paying SOME bills havent they?

If you are referring to the latest in non bill paying... OF COURSE he wasnt paying his bills!! he got sued and decided to bolt and run roflmao.

[Sin_Vraal]

Originally Posted by SpeakEasy

LMAO dude I was referring to the natnet downtimes ...

[webmasterchecks]

Originally Posted by Brad Mitchell

There are so many false and inaccurate assumptions in this thread on every level from so many different people.

brad, this is a great thread, you should explain that out and keep it going

Originally Posted by Sin_Vraal

You know, I said the same thing to one of my friends. MANY times actually (downtime isn't a rare thing there), and you know what he said?

"Even if I'm down I still save more money hosting there than I do with you, paying your higher rate"

I didn't really have much to say after that.

its an interesting point that prices like $4 meg allowed business models (and experimentation/exploration of others) for the first time that made less money per bw used, like cogent allowed the mass proliferation of free hosted galleries.

You can try things without having a large exposure of hosting costs, and as these are sites that make money, but its not critical that they are up 100% of the time

So from another point, as the value of content goes down and cost to transmit that content go down, this ultimately gets more alternatives to consumers that are buying your clients content.

Ultimately, the tube sites showed up because of low bw cost

[Snake Doctor]

Originally Posted by Brad Mitchell

There are so many false and inaccurate assumptions in this thread on every level from so many different people.

Well since this is your thread, that you stared, and it's a "MUST READ", then please tell us point by point how everyone that disagrees with you is wrong, or is making false and innacurate assumptions?

I think alot of times your points make sense, but you have this habit of looking down your nose at your cheaper competitors and those who host with them and imply that we don't care about our business or don't care about downtime because we're not overpaying you to host us.
That rubs me the wrong way.

[Karupted Charles]

Originally Posted by Snake Doctor

Well since this is your thread, that you stared, and it's a "MUST READ", then please tell us point by point how everyone that disagrees with you is wrong, or is making false and innacurate assumptions?

I think alot of times your points make sense, but you have this habit of looking down your nose at your cheaper competitors and those who host with them and imply that we don't care about our business or don't care about downtime because we're not overpaying you to host us.
That rubs me the wrong way.

A lot of things rub you the wrong way Lenny. As to your Wallmart point try to find a rep at wall mart that actually knows anything about the product. The mom and pops knew the product helped you find it and helped you pick out what was best for you. You paid for the premium just like you pay to deal with awesome techs at nat net or mojo. Comparing AR to Wallmart is spot on but not in the way you wanted it to be. They are bottom of the barrel self help not in the same league as the quality mom and pop shops they try to run out.

[sandman!]

Originally Posted by Snake Doctor

Well since this is your thread, that you stared, and it's a "MUST READ", then please tell us point by point how everyone that disagrees with you is wrong, or is making false and innacurate assumptions?

I think alot of times your points make sense, but you have this habit of looking down your nose at your cheaper competitors and those who host with them and imply that we don't care about our business or don't care about downtime because we're not overpaying you to host us.
That rubs me the wrong way.

have a drink and chill out a little.

[webair]

Originally Posted by Snake Doctor

Well since this is your thread, that you stared, and it's a "MUST READ", then please tell us point by point how everyone that disagrees with you is wrong, or is making false and innacurate assumptions?

I think alot of times your points make sense, but you have this habit of looking down your nose at your cheaper competitors and those who host with them and imply that we don't care about our business or don't care about downtime because we're not overpaying you to host us.
That rubs me the wrong way.

he has a right to his opinion...Here's mine =)

*** Alpha Red clients get out while you still can! ***

[HorseShit]

Do you people really think AR is going anywhere? Clueless

[SpeakEasy]

Originally Posted by jdavis

Do you people really think AR is going anywhere? Clueless

Truely an Idiot.

[HorseShit]

Originally Posted by SpeakEasy

Truely an Idiot.

Who is, you?

[SpeakEasy]

Originally Posted by webair

he has a right to his opinion...Here's mine =)

*** Alpha Red clients get out while you still can! ***

I will have to agree with you on this.

[Snake Doctor]

Originally Posted by Karupted Charles

A lot of things rub you the wrong way Lenny. As to your Wallmart point try to find a rep at wall mart that actually knows anything about the product. The mom and pops knew the product helped you find it and helped you pick out what was best for you. You paid for the premium just like you pay to deal with awesome techs at nat net or mojo. Comparing AR to Wallmart is spot on but not in the way you wanted it to be. They are bottom of the barrel self help not in the same league as the quality mom and pop shops they try to run out.

I pointed that out in my wal-mart analogy. Sure the mom and pop know their shit and wal mart employees are clueless, but at the end of the day the mom and pops are still bankrupt and wal mart is still growing.

Brad has to justify his higher prices, you have to justify paying his higher prices, that's why you're in here having this discussion.

If nothing else the cut rate hosts are a blessing to you as well, because they're the reason hosts like mojo have had to cut their prices from $150 to $15 per meg over the years.

Hosts like AR and Choopa are to natnet/mojo/techiemedia what cogent was to level3 and gblx.
Cogent is definitely lower quality, but it's still more than "good enough" for what most people are using it for....and it forced the prices down on the higher end stuff.

[Lightning]

Wow this was some good reading for a Sunday morning. Some people are simply clueless. I quarantee this thread will get bumped back up in the future, may not be next week or month but it will be back, and I can see a whole bunch of hosts saying "We told you so"

[webair]

We tolddddddddddd you soooooooooooo! =)

[famous]

Originally Posted by ladida

Don't know much about hosting, but Vraal's post is spot on. Alpha didn't fall because of beeing cheap, but beacuse of microsoft. Choopa is selling low for years now, and they control huge amounts of bandwidth. Are they dicks, i dont know, same as i don't know are any of you other here, but saying it's not possible is stupid.
This thread is not your best move Brad. You said they bring it, some people brought it, you didn't reply... Just makes you look jealous..

yeah they didnt fail from being cheap but they are getting sued for spyware that they used thier own hosting for. So if fucking surfers over pays 10xs what hosting does then i guess the hosting end would not need to be profitable

[SpeakEasy]

Originally Posted by jdavis

Do you people really think AR is going anywhere? Clueless

Look who is clueless now... I told you you were an Idiot, you should have believed me last week.

[Brad Mitchell]

Originally Posted by SpeakEasy

Look who is clueless now... I told you you were an Idiot, you should have believed me last week.

We finally saw eye to eye on something!

Brad

[Snake Doctor]

Originally Posted by Brad Mitchell

What I can say with confidence and without hesitation is basically if you "need" to buy bandwidth at $3-$6/megabit to be profitable then you're fucked for now. Hundreds have built a business upon costs which don't truly exist in the marketplace. Because a few companies have retailed at these rates successfully for some amount of time there is now a completely inaccurate perception of reality.

You don't know because it's not your job to, you're not a host. What you *think* you know about peering and wholesale rates is entirely incorrect, this even applies to some of my host competitors.

You may choose to believe that this range of retail rate for server, bandwidth, support or even just raw bandwidth is sustainable. It is not, it is completely below cost for even the largest buyers of bandwidth in the marketplace. What you see or have seen in the marketplace is a complete pharse.

I hate to beat a dead horse here, but there are like half a dozen companies right now offering to match Alpha Red's pricing to get their customers.

I've also seen at least 2 $4/mbit specials with a server included in the past week.

It appears this "pharse in the marketplace" is going to continue, in which case, maybe it's not a pharse at all but just the way things are going to be from now on.

[Sin_Vraal]

Originally Posted by Snake Doctor

I hate to beat a dead horse here, but there are like half a dozen companies right now offering to match Alpha Red's pricing to get their customers.

I've also seen at least 2 $4/mbit specials with a server included in the past week.

It appears this "pharse in the marketplace" is going to continue, in which case, maybe it's not a pharse at all but just the way things are going to be from now on.

Snakes Right ... I totally just got beat down by him b/c I had a more than 3 line sig (which offered 4/mbit)

4/mbit isnt going, in fact if you arent able to deal with it, you should consider selling to me!

that is all.

[Rodent]

Originally Posted by Sin_Vraal

Snakes Right ... I totally just got beat down by him b/c I had a more than 3 line sig (which offered 4/mbit)

4/mbit isnt going, in fact if you arent able to deal with it, you should consider selling to me!

that is all.

Shhhhhh the oracle said such pricing is not possible