MaximumASP Weblog

SQL 2005 Service Pack 2

Microsoft has officially released Service Pack 2 for SQL Server 2005. This anticipated service pack provides support for Vista and the new Office 2007 suite, as well as fixing over 61 bugs. The Database Administration team at Maximum ASP is currently testing the new and updated features of Service Pack 2. After thoroughly testing SP2, the shared SQL 2005 customers will be notified of when SP2 will be applied to the shared servers. Following the upgrade of the shared SQL 2005 server, dedicated and Virtuozzo customers will be contacted about upgrading to the new service pack. Those dedicated and Virtuozzo customers who are prepared can install Service Pack 2 immediately themselves.

Cinderella Story or the Work Horse?

After being in this business for nearly 10 years now, one thing seems to recur time and time again -- the Cinderella Story. It seems like every year or two, a new provider or an existing provider that has been recently reinvented does one of the following things:

1. Undercuts the competition with ridiculously low pricing on hosting plans, servers, bandwidth, or disk space. Pricing that doesn’t make sense no matter how you cut it.
2. Takes something that many other providers have been doing for years and calls it something different, or hypes it in some new way and attracts uninformed (note I did not say unintelligent) buyers.
3. Grows their low-price-amazing-and-crazy deals-call-it-something-new hosting company to incredible heights and then sells it to the highest bidder. The highest bidder then realizes that these "crazy" deals are not making satisfactory margins or any margins at all and raises prices. Customers begin to leave and look elsewhere for other hosting providers. The highest bidder attempts to keep costs low and does not scale support to keep up with customer needs, or it has problems with the integration of their new hosting company. The founders of the acquired company use capital from the sold company, setup a new hosting company and begin taking customers from the old company with - you guessed it - "crazy" deals. The process repeats itself again in two to four years.

Take the flip side of this situation. Let’s call it the Workhorse. Tried and true, these companies have been around since before the dot com bust, have stayed true to their business models over time, and have pulled off the one thing you would think any hosting customer would die for: They have provided consistently solid support for 5 to 10 years! These companies have not had meteoric growth; instead, they have focused on solid, repeatable growth year over year and have used this consistency to scale their business to provide increased quality and service for their customers with minimal disruption, if any.

I am always amused to read forum posts on the various web hosting-centric bulletin boards where I see a customer bash one flash-in-the-pan host and move to another flash-in-the-pan host only to do the same thing eight months later. You would think that people would learn over time, but, alas, many do not seem to be getting the picture.

To tie these two together, I would simply like to reference a few Business 101 teachings:

1. Pricing - You can name any price you want, but a sustainable business model must have margin built in. Margin must consider raw material and input price fluctuations (servers, power, racks, personnel, etc.). Any business model that sets a price with little or no margin is not sustainable for the long term. Customer-acquiring plays through loss-leader product development have shown that time and time again they do not work. Ultimately, the current company or an acquirer will have to adjust pricing to make the model work, whether it be due to current business needs or future scaling requirements. When this happens, many of these bargain-shoppers jump ship. You have to be in business to make money - it is that simple.
2. You can polish a turd, but it still smells like a turd. Calling a server a "Centralized Hyper-Neural Processing Device" does not change the fact that it is a server. Calling a back-end network with 100Mbps port limits a private network and portraying it as something new and different does not make it something new and different. It is still just a back-end network with a high rate limit. Come on over we will show you ours. It has been around for years now.
3. The pattern of firms buying three-and-out hosting companies without sustainable business models - only to repeat the same mistake several years later - does not help our industry at all. It drives multiples down, creates customer ill-will and churn and promotes a sense of constant flux in the hosting marketplace.

Workhorses are the hosts that deserve the real credit - the folks that have put together a solid business model that has proven itself year over year. It would be nice for some of the general hosting consumer mass to notice these companies and find a place where they can stay, but alas a rapid influx of new customers could be disruptive to the consistency on which these hosts thrive.

In the meantime, I guess the workhorses will just have to weather the storm of paradigm shifts as flash-in-the-pan providers commoditize the market, fail to scale their support, and generally prove that there is no way around the Business 101 principles. As Ron Burgundy might say, "Stay classy, Workhorses" ... and as I would say, "Down with the commoditizers, and long live hosting consumer education!" To the hosting public out there, I ask you to search for substance in your host. Do not be lured away from this focus by the shiny objects referred to above as the Cinderella hosts ... she doesn’t look so good with the makeup off!

95th Percentile

If you've logged in and seen our new bandwidth UI, you've probably noticed a new piece of data labeled "95th percentile." One of the new features of the new bandwidth system is tracking bandwidth by megabits per second (mbps). For our higher bandwidth customers, this method can be used instead of tracking based on the total amount of data transferred.

To gather this data, we take a sampling every five minutes which will give us a roughly 8,640 readings per month. We use this data to figure out how much of our pipe you are using and then bill you on that value. To get this reading, we take the 95th percentile of the data. This is also called Burstable billing.

The 95th percentile gives us a value which roughly tells us that 95% of the time, the usage is below this amount. What we do is take all of the data we gathered up over the month and sort it. We then take the top 5% of the values and throw them out. The highest value that is left becomes your billable utilization.

The advantage for the customer is that the peak values are thrown out. Many of our higher bandwidth customers use a steady amount of bandwidth, but periodically they need to burst up. Let's say, for example, every morning at 8:00 am you need to replicate many gigs of data from your local servers up to the web servers hosted at MaximumASP. This process only takes about 30 minutes. With burstable bandwidth, we’ll allow you to get as much bandwidth as needed to accomplish this process as possible. And, as long as this temporary spike in traffic accounts for less than 5% of the total data, we won’t penalize you.

The vast majority of our customers are still billed per GB of transfer. If you are noticing peaks in your bandwidth and would like to be switched to burstable billing, please contact sales.

New Bandwidth Tracking

As you may have noticed, the bandwidth stats in the control panel now have a new user interface. Behind the scenes is also a whole new bandwidth tracking system.

We are now using a hardware based system using equipment from Foundry and InMon to monitor all bandwidth. In the past we used a software based solution which wasn’t nearly as accurate or as in-depth.

• We are now tracking data on all ports. In the past we only tracked ports 80, 443 and ports 21.
• You can now break down the data by ip address and port. Previously, we only identified the total traffic for an account regardless of how many IP addresses were associated with the account.
• Data transfer between devices within our network is differentiated from data from the outside world. The only data you pay for is traffic crossing our network boundary. For example we won’t bill you for the traffic between your web server to your database server.
• We can now track throughput as well as the volume of traffic. For our higher bandwidth users, this means that you can choose to be billed on the portion of the pipe you are using instead of having to worry about bandwidth overage charges. Having a set price for bandwidth can work better for those who continuously worry about overage charges.

For the vast majority of customers this will only mean better reporting of their data. If you are doing a lot of traffic off ports other than 80, 443 and 21, please make sure you log into the control panel and check out your bandwidth usage to make sure there aren’t any unexpected surprises.