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Hosting Giants Teaming Against Small Businesses
BlueToast writes "Hosting giants SoftLayer, ThePlanet, Hosting Services Inc., and UK2 Group are teaming up to wipe out small competitors like SimpleCDN. Though ThePlanet isn't directly involved in the slicing of SimpleCDN's throat, ThePlanet runs the sales chat scripts for SoftLayer (check your NoScript). As a loyal customer of SimpleCDN, I really do not appreciate the disruption of service to a company I have been with for over a year. SimpleCDN's president wrote, 'Absolutely no valid reason or warning was or has been given for this termination, and our best guess currently is that these organizations could not provide the services that we contracted and paid for, so instead they decided that terminating services would be the best solution for them.'"
Softlayer and ThePlanet merged a few months ago. And UK2/"Hosting Services"/100TB simply resells Softlayer's services.
100TB has a bandwidth pool deal with Softlayer, then oversells like mad. SimpleCDN used 100TB [I -believe-] to get excellent bandwidth deals.
Seems like 100TB [and perhaps Softlayer] weren't happy with this.
It's unfortunate to see obviously overselling hosts not even try and make right by their sales pitch. However, those "to good to be true" deals really are "to good to be true". You get what you pay for. Best of luck to the SimpleCDN team and their future endeavors.
UK2 also confirmed to us many times that their business model fully supports 100TBs of transfer, and SimpleCDN has been utilizing these servers for many months now without problem.
Again, more emails from Ditlev and UK2...
"We have no problem with anyone doing 100tb/month - month after month, our business model fully support that"
The 100TB website still advertises 100TBs of transfer with each server, along with "As you would expect unmetered bandwidth from 100TB is truly unmetered and unshared, with no limits and no small print. Unmetered servers use exactly the same SoftLayer network as their 100TB equivalents and are fitted with 1000Mbit ports."
So 100TB is still advertising and selling this service to others, but for some reason SimpleCDN is turned off? Why was SimpleCDN singled out, while this "offer" is still being made to others?
Why was the service provided for months, until one day a demand was sent requiring us to immediately shutdown all servers?
I still have absolutely no frigging idea what it's about.
No sane company terminates "right the hell now" a paying customer, even if it is unprofitable. Unprofitable customers usually are shown the bill or the door hoping to either convert them to profitable customers, or to take their business elsewhere without causing too much fuss. My gut feeling agrees with the AC that over-use of bandwidth may be the case. However, sane business practice demands to try and straighten the situation before starting using the scissors. I don't see any of that in the only side of the story commented thus far - unsurprisingly, since TFA comes from that one side.
Well UK2 today said that the decision "... was out of our hands." So who would that leave?
You ignorant tool, have you ever submitted a story to Slashdot? If you had, you'd know that they don't hit the front page right away. Sometimes it's hours later, many times it's days. If you do post a story, it's not like you sit there, wait a few minutes, and then start replying to people, because you may very well be sitting there for days.
I'm guessing that "BlueToast," whoever that is, even if it is a sockpuppet, as you so flagrantly accuse him/her of being, likely posted this in the middle of the day or early evening. It hit the front page at 5:11am US Eastern/2:11am US Pacific time. Given that the story is about a U.S. provider, I'm guessing BlueToast is probably sound asleep right now, and SimpleCDNNOC's claim that he/she is up in the middle of the night working for his/her customers not only plausible, but probable.
By the way, on what are you basing your accusation of "flagrant over-use of bandwidth?" Do you have a copy of the contract that SimpleCDN and their providers? Do you have the metrics showing how much bandwidth they're using, and how much is/was available?
Slashdot is "News for Nerds, Stuff that Matters." Let's see... News? Yes, I think this is pretty damn newsworthy. For nerds? Well, it's squarely in the IT/technical realm, so yeah, I think that it would be of interest to nerds. Stuff? It's definitely stuff. That matters? Well, if you're one of SimpleCDN's thousands of customers, or someone who consumes those customer's content or data, or if the submitter is right in that this activity may spread to other hosting providers (which it sounds like it may), then that would be a big green checkmark in that column as well.
I could just as easily accuse you of being a sockpuppet for one of the nasty evil companies that is screwing SimpleCDN, posting on Slashdot as an Anonymous Coward to try to add insult to the injury you've already caused, and my accusation will be just as valid and appropriate as your little rant.
I guess that's just a long way of saying Anonymous Coward - if you think this story isn't worth reading, then don't comment. If you can't do that. STFU. Now get off our grass!
I can't use SimpleCDN because they're gone.
I can't use Amazon's CDN because they're jerks to wikileaks.
I can't use VPS.net's (UK2/100TB) CDN because they're jerks to SimpleCDN.
I can't use anyone who runs Softlayer's CDN because they're in kahoots with UK2.
I can't use anyone who runs Layer3 because they gave in to Comcast (netflix story from a while back) and will probably jack up my prices.
I can't use Akamai because I don't have deep pockets.
If Google comes up with a CDN I can't use them because they steal everyone's privacy.
Sorry, that's your problem.
Either be the real provider or be held at the mercies of your suppliers. YOU should have known that. It's certainly the case in almost every business.
Thank you, Mr. Genius. Did you know that Slashdot uses hosting services, so technically, it's at the mercy of its provider. They should know this. So if their provider suddenly decides to take down their servers, hey, that's Slashdot's problem, right? I run some gaming web sites, with Linode as my hosting provider. If Linode suddenly decides to shut down my servers without warning, I suppose that would be my own damn fault, right?
Okay, so let's take this to its logical conclusion. That means that really, when you think about it, the only people who should be trusted as hosting providers are the massive telecoms, right? Because they're the only ones who can really guarantee that no upstream provider will shut down your service, since they own the wires that go to your house.
That's a brilliant solution, consolidate all service in the hands of one or two companies. I'm sure nothing could possibly go wrong with that.
Oh wait, AT&T depends on its wire suppliers, which depends on miners in Chile, who depend on wheat growers in Russia... Looks like we need to just consolidate the whole damn world into the hands of AT&T and let them rule us as dictators...
I used to work for UK2 out of Chicago and I can confirm their shadyness. They advertise 100TB of transfer but if every server on every rack they have at SL utilized this they would be out of business.
Ask their sales guys to explain how it works, grab some popcorn, and laugh as they fumble their reply or ignore you.
100TB = SHARED bandwidth, as in all servers on a rack or switch share the 100TB. That is their deal with SL, or at least it was a few years ago.
This guy probably caused an overage so they pulled the plug on him.
When I worked there I did the same thing to other accounts for various other reasons. Sorry, but this is not unheard of I'm afraid.
For the record, OP: Hosting Services Inc. *IS* UK2, and they also resell BOTH The Planet and Softlayer's servers. There is only one real Hosting Services DC and I don't think that runs dedicated boxes. In all, UK2 has somewhere around a dozen brands, maybe more by now, that are spread out through these data centers.
Oh and Ditlev is a PR expert, I would not trust anything out of his mouth. Just saying.
No... in the case of bandwidth, you can actually do this, and I think that was the point. My ISP does this all the time. It's because "bandwidth" is a damned flaky metric in the consumer space. I pay for 10 mb/sec (supposedly) DSL but rarely, if ever, do I actually get that -- even locally, from home to business -- because they grossly oversell the capacity they actually have in place. My ISP specifically says in the service agreement that they don't have to supply the designated plan bandwidth, and if you can't connect as you need to, tough cookies. Legalese to that effect. I would bet you dollars to doughnuts that if you added up the bandwidth my ISP sells against the pipe they actually have, you'd find a mismatch of several orders of magnitude. This allows them to sell bandwidth for less than they pay for it by making it up in volume -- it's an inferior product, that's all.
I've fallen off your lawn, and I can't get up.
I spent 7+ years in the hosting industry. I can tell you right now that when Ditlev said his model "fully supports" customers doing 100TB month over month, my "bullshit meter" went through the roof. At best that was a simplification of his business model (sure, ONE customer can do 100TB month over month, as long as 100 other customer's don't - or perhaps he means 'sure, you can do 100TB for 3 months, as long as you don't use your server at all the other 9 months of the year').
So here's the real deal for you. The cheapest bandwidth I've ever heard of, ever, in the hosting industry was about 2 dollars/megabit, and this was NOT premium bandwidth, and it was single provider (Cogent). That price was let slip on the WHT forum, in fact, so I'm not giving away any privileged non-public information. Chances are good the top companies get even cheaper pricing (bigger than hosting providers) plus even hosting providers these days do a lot of peering to try to cut costs. But they also typically offer blended bandwidth from multiple providers (upping their cost/megabit), so the math below is still probably being too nice to them.
But let's go with this $2/mbit. There are 1000 megabits in a gigabit. That's $2000/month for a gigabit line. Now at best, a gigabit line can do 125 MB/s (in one direction - and since most these high-end bandwidth deals are typically charging on only the busier direction with the other way being 'free', that works for this example). 125 MB/s * 60 seconds * 60 minutes * 24 hours * 30 days = 324,000,000 MB / 1024 = 316,406.25 GB / 1024 = 308.99 TB. That's 308.99 TB for $2000. $2000 / 308.99.
That's $6.47 per TB. They're offering 100 TB. That's $647 COST per server (and I'm not even including the cost of the actual hardware here; that $201.15 lowest-cost server on their site is a quad core Xeon 3220 box that has some cost attached to it, and it eats power which has cost attached to it, plus you've got to factor in support burdern, infrastructure burden, etc, but hey, let's say by magic that's all free!).
Each server UK2 runs at that price is costing them 3x what they made on it in revenue, minimum.
Generally this works because every individual customer is not pushing 125 MB/s 24x7. Not even close. Most probably don't even push a third, so they're flat-out profitable. Others don't even push a tenth, others, not even 1 TB (I know this to be true personally, as I have a buddy with a 100TB server who does not push 1 TB a month - he's on 100TB because they actually had one of the best deals on a dedicated server from a cost per MB of RAM and HZ of CPU, on TOP of the 100 TB of 'free' bandwidth). They're making their money, like (news flash) EVERY OTHER HOSTING COMPANY - overselling. Do not listen to them say they can totally make money if every customer pushes max each month. They can't.
You want proof they can't? SimpleCDN represents a high-usage customer; possibly even approaching the 100TB on each server, if their software was good enough to not have CPU/RAM be the bottleneck. A CDN or other content streaming site is probably the single worst customer I can think of for an overselling operation; and lo and behold, they've been shut off. Case closed - they cannot actually provide every customer 100 TB a month. They can provide a certain % of their total customer base 100 TB a month, and then it's not profitable anymore.
Good news for all the rest of 100 TB's customers is that with SimpleCDN gone, now there's probably more chance of them getting away with 100 TB/month for a few months without being shut off. :)
Now to be clear, I'm pinpointing UK2 group here, but this could be Softlayer. If UK2 group is getting a super deal on bandwidth from Softlayer and it's Softlayer who is essentially overselling (plausible), then they're the ones likely pushing for the shutdown of SimpleCDN. Whoever's business model actually has the oversell in it (or both of them) is the one who's happiest to see SimpleCDN go.
Truth is, a company as large as SimpleCDN s
Yes, there is plenty wrong, if you have signed a contract with the customer saying you will sell your service to them you can't just go and change your mind later and say you'll take their money but don't have to give them service because you dreamed up some new rule after they paid you. It's utter crap, how can you not see this?
Don't think for a instant that I disagree with you, but unfortunately there's a big difference between what is right, and what "is"
Right now just about every TOS type document has "we reserve the right to alter this agreement without notice at any time" clauses. It is time to test that, though. Just because you were arbitrarily forced to agree to something to use a service, doesn't mean it will stand up in court.