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@rds100 The DC is located in Tampa, FL. I am an hour North-East of Orlando, FL. So, about a 3 hour drive.
@Jeffrey this mens you would need to rely on remote help from the DC staff. You need to negotiate with them in advance how much help they are willing to provide.
@rds100 Yes, I have already talked through this issue with them. The only thing they will charge are OS reinstall fees.
And how much is that? What if someone purchases and cancels after a month? If even 1/2 the customers do that, you might be losing money if it's more than $15 or whatever the price is.
@concerto49 If they cancel without a valid reason, I will not offer refunds, just like I have in the past, it works. I have came up with really good pricing for these low-end machines that appeals to cheap buyers and is sustainable
It's not cancelling and refunding. Every time you have a new customer you need an OS reinstall. If these don't come with IPMI or KVM over IP, you'll be paying for it each time a customer leaves.
Hence as I said, for the prices you're offering, this reinstall fee can already strip you off any profits and even push you into the negative fast.
@concerto49 Hmm, haven't thought of that yet. As these servers will be reused, and not rebuilt like newer machines. These machines are currently not built and the processors are lying around in a closet, as long with the 1GB Ram sticks, as the DC doesn't order them in 1GB anymore.
Anyone know of any DC's in the US with old hardware laying around not being used?
@Jeffrey, Hmm.... looking elsewhere already or just for more options/expansion/sanity?
@pubcrawler
It's not sustainable not matter how much anyone makes it as without owning a DC, having someone living there or having IPMI.
Why?
Imagine you rent 10 servers. @ $20/month, you're lucky to make $5 out of that.
Imagine 2 cancel. You need 2 OS re-installs. Usually the price of that is $15-20 MIN. Some places charge a lot more.
You make $50 from it. You spend $30 on OS installs. After all the work, support etc of 10 servers, you get $20/month. A chargeback hits and you're gone. A DDoS comes, eats your bandwidth and you're gone.
Many other factors to consider.
That isn't the problem. You can buy hardware from ebay, fully fully test it and do the same. The problem is no staff on site and remote hands fee. Why would a DC not charge you $100/hour and instead give you all this for free? Either that or colo cost won't be cheap. If the DC has to race to the bottom in terms of prices that bad, quality hits.
I thought about doing this, but properly - with some SuperMicro FatTwins. It just wasn't worth the investment, although we do get some free remote hands per month right now.
These "race to the bottom" plans have not worked out so well in the end, in my experience. I'm sure @Nick_A can comment on this also.
I don't recall race to bottom dedicated servers though. Price of dedicated is really crammed. Atoms and L5420's are practically the same price in places.
The low end for dedicated... has potential... but have to be real close to facility and doing on hands on with stuff like this or custom servers. These have too many hours on them, failure rate, hands on costs for installs, etc.
My point is that you'd probably want extensive background knowledge and funding to do it on a scale that's worth your while.
Just for more options and expansion.
Can you guys give me a list of well known Floridian datacenters? Thanks!
GoRack?
^ --- GoRack and they've been shedding customers lately it seems.
@Jeffrey reinstalls can be automated, if these things support PXE booting (99% they do). I doubt they have IPMI though.
Still i recommend you find a DC close to you so you can go and do things yourself whenever necessary.
@rds100 The closest Datacenter to me is HostDime in Orlando, FL, which is an hour and a half away.
They still permit those in datacenters haha.
@GetKVM_Ash They most likely won't have 80GB IDE's, as they are very, very low in stock in them. Lol. They don't sell them anymore.
OK, I'm 90% sure these are what the LEB Dedicated server plans will be:
Intel Celeron's or Intel Pentium 4's
180GB IDE HDD's
1GB Ram
500GB Monthly Bandwidth
Pricing - One option will be contract, and the other will be non-contract.
Contract Plan: $50 Setup fee, $5/month after for a year.
Non-Contract Plan: $25/Month
Hosted in Tampa, FL
It makes zero sense.
what happens after a year on the contract plan?
So $110 total for a year. What happens if nobody orders a non-contract one, and you have 40 contract dedicated customers filling the rack. That totals $4400/year, or $367 per month. Are you telling me that you can have a full rack of that hardware colocated (I imagine you won't own the hardware?), for $367 per month?
Taking in to account billing panel licenses, payment processing fees, hardware issues, and the time you're putting in... There is surely no way that you're able to make any money from this? Even with selling out the entire rack, surely you wouldn't break even?
Only way I can see it happening is if they're literally giving you the hardware and a full rack for it for free. Even in that scenario, you wouldn't make that much by selling 40 dedicated machines at $5 a month.
confused
@liamwithers you do have a point. however, the datacenter is providing me a rack free of charge for these machines, as they have plenty of empty racks and they have nothing else to do with these older units. These units cost less than 10 dollars a month to run. I will be making money either way. Think of it like a cell phone contract, if you leave the contract early, I will charge a fee for leaving the contract early. However, I am thinking about making these contracts 6 month contracts. After every 6 months of billing, you have to pay that 50 dollar fee again. Makes sense?
@titanicsaled after the contract is over, you can renew it by paying that 50 fee again or you could switch to a non contract plan at no charge.
Ok. It will be interesting to see what will come of this.
If used as a comparison to a phone contract, then it doesn't make sense. You'd only pay a one-time fee as payment for a phone, and if you keep that phone you don't pay at renewal time, and in fact frequently get a free upgrade. However, some upgrades do come at a cost. There's never any fee to renew the same contract though. It would make more sense to recoup the additional $50 after the first 6 month period by splitting the cost in to monthly payments, but by that point you're more than doubling the initial $5/month fee as it'd go up to over $13.
If they cost "less than 10 dollars a month to run", then why charge $5 a month? Surely you'd only charge $5 per month if they were costing less than $5 per month to run, which I assume they are not. Even with the $50 contract/renewal fee, that's putting you up to only $13 per month, which given the age of the hardware and likelihood of failure on drives etc. It doesn't seem a logical business model. Personally I don't think a profit of $3 per month is enough on a dedicated server. Especially if you're not looking at other fees that you'll have, such as billing panels, transaction fees etc.
This sounds like a bad idea, but if you think you can handle it, it will be interesting.
You should have the option to switc out the hdd for a ssd.
@liamwithers you do have a point. i will further investigate into the offers I will be offering for these dedicated machines. @RobertClarke We will see.
And @curtisg I'm not sure if this DC has SSD's, if they do, these machines won't be offered at lowend prices.