The Web Hosting Industry is Alive and Well
After a turbulent and somewhat scary hiatus, webmasters don't need to worry too much about the general health of the hosting industry. Bandwidth is a critically important issue for adult sites because their media-rich content demands a lot of it. The amount of bandwidth you choose to purchase can make or break your site. The most significant brake on rapid uptake of broadband connections is that they are currently just a bit expensive, a situation bound to change as the installed base widens.
When so many dot-com startups went under over the past year or so, hosting companies and telecoms could not expect to escape unharmed-if a weak link in the chain breaks, the rest of the chain is inevitably affected. The result was a market in which sudden lack of demand left hosts grossly over-supplied. Many went bankrupt or fell prey to takeovers, the casualties including biggies such as PSINet, Exodus Communications, and 360Networks. 2001 was a year of reaction in the form of widespread restructuring through mergers and acquisitions, resulting in a healed but somewhat different landscape. The situation had both similarities and differences in Canada (see sidebar) but for the US, as Liam Eagle summed it up in "Mergers and Acquisitions Consolidate Web Hosting Industry in 2001" (Web Host Industry Review 12/2001):
2001 had an unmistakable effect on the geography of the Web hosting industry. What was once a breeding ground for startups and small providers is quickly becoming a market best suited to the giants. As IT outsourcing needs become more complex throughout the business and e-business worlds, the large, fully equipped service providers are becoming the companies best suited to meet those outsourcing needs. And with the big companies buying the small, and the medium-sized companies banding together, Web hosting leaves 2001 as a more consolidated industry, and one with every reason to expect that its distillation will continue.
In that same issue, Rawlson King ("Web Host Industry to Restructure, Focus on Logical Infrastructure in 2002") sums up the current business climate:
With the longest expansion in U.S. history officially over, hosting companies will focus on isolating and providing the most profitable service offerings. These offerings will mostly consist of full service, quality-of-service hosting and IT security solutions. Many first generation Web hosts are still confounded by their own heavy emphasis upon infrastructure. As a result the next generation of complex hosting providers will not exclusively focus upon deploying state-of-the-art Internet data centers. Instead, this next roster of complex Web hosts will focus upon providing logical, enhanced, and specialized Internet services.
He also draws attention to a renewal of focus on security and data protection in the wake of the US terrorist attacks. Nothing too worrisome for the adult webmaster in all that, especially the focus on specialized services. After a turbulent and somewhat scary hiatus, webmasters don't need to worry too much about the general health of the hosting industry. But they do have their own issues, and high-bandwidth hosting has to be one of the most pressing. Here's why.
Bandwidth
Everyone knows you can't be too rich, or too thin, or have too much bandwidth. We talk about it all the time, but, what the heck is bandwidth, anyway? Whatis.com gives the following definition:
Generally speaking, bandwidth is directly proportional to the amount of data transmitted or received per unit time. In a qualitative sense, bandwidth is proportional to the complexity of the data for a given level of system performance. For example, it takes more bandwidth to download a photograph in one second than it takes to download a page of text in one second. Large sound files, computer programs, and animated videos require still more bandwidth for acceptable system performance. Virtual reality (VR) and full-length three-dimensional audio/visual presentations require the most bandwidth of all.
2001-A Year to Forget
For most hosting companies, 2001 was a year to forget. The continued dot-com implosion, coupled with a sagging economy, led to the demise of numerous once-mighty hosting firms, and consolidation, closures and layoffs were rampant.
Web Host Industry Review's "2001 Year in Review" issue is one-stop shopping for perspective on industry developments during a very turbulent year.
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So bandwidth is basically the amount of data (traffic) that can be sent between two computers in a certain amount of time. More bandwidth means a faster connection. In terms of a Web site, more bandwidth means more users can be accommodated at the same time, and faster response time. Bandwidth is a critically important issue for adult sites because their media-rich content demands a lot of it-it's a broadband medium.
Consider that a page with three 10K images and 2K of HTML needs 32K of storage, and at 100,000 views a month, that comes to 3.2 GB to be transferred each month. For a ten-page site, that adds up to 30.2 GB, and is the minimum bandwidth the webmaster has to purchase. However, that's just plain ole' pictures. Digital video is somewhat more storage intensive at 13 GB for an hour, which would require 1,300 GB for 100,000 views over a month. And, of course, visitors to adult sites have an insatiable appetite for storage- and bandwidth intensive content such as streaming video. The kind of bandwidth normally offered by free or budget hosting services can obviously support only a pretty limited adult site. Lack of adequate bandwidth is a bottleneck that limits the content you can deliver or deliver with acceptable response time.
Beating the Bottleneck
Although their services are varied, hosting companies are basically selling bandwidth-Internet connectivity of greater or lesser capacity. Because of this, it is important to select a Web host that can potentially offer you a lot of bandwidth.
The amount of bandwidth you choose to purchase can make or break your site.
Ordinarily, webmasters contract with the host for a certain amount of bandwidth, with some kind of surcharge for any additional amounts consumed. Both the basic deal and the fine print are critical to getting what you need at good price, and especially with no unpleasant surprises down the road. Here's a horror story, found in Putting the Focus on Bandwidth (www.tophosts.com):
Some hosts advertise "unlimited bandwidth," but what does this mean? Is it really unlimited? After consulting with several top companies, I can say that unlimited bandwidth isn't unlimited at all. WebHosting.Com, which offers unlimited bandwidth, will actually only provide 12 gigs. If you need any more than that, the company will suggest that you look into a dedicated server. If you exceed the 12-gig limit on a regular basis, expect your site to be deactivated.Pagecreators.net, a hosting company based out of Minnesota, has come under fire for allegedly scamming clients with its fine-print stipulations. The large print offers unlimited bandwidth, but the contract tells another story. Hidden in the small print, underneath all the jargon and legalese, is a clause stating that bandwidth over a certain amount is subject to a usage fee of $1 per kilobyte. One former customer discovered a charge of $9,000.00 on his credit card bill, and when he tried to contest the charge, he was told that his contract clearly outlined a rate of $1 per kb.
There is not room here for a buyers guide to high-bandwidth hosting apart from that caveat emptor caution, but one nice result that came out of a bad previous year for the hosts is that there is currently an over-supply of bandwidth available, so that webmasters may expect to find discount pricing. For some price comparison shopping, the sidebar lists 15 of the companies adult.tophosts identified as among the current best.
Going into 2002
But let's not forget your market. The availability and actual use of broadband Internet connections "downstream" in users' homes are measures both of the potential market's size and the size of its demand for the services.
Broadband or "high speed" connections are mainly digital subscriber line (DSL) or cable connections, and the USA is rapidly becoming very well connected.
The Yankee Group forecast that three quarters of households in the US can access high-speed Internet services at this time, if they want to do so-66% cable modem and 45% DSL). At the beginning of last year, only 60 percent of households were passed by cable modem or DSL service providers.
And more and more users are taking advantage of the opportunity to purchase these lines all the time. The number of high-speed lines in the US amounted to 9.6 million in June 2001, according to the Federal Communications Commission, which reports that the number of high speed lines increased by 250 percent between August 2000 and June 2001. Most of these (7.8 million) were residential or small business lines. The most significant brake on rapid uptake of broadband connections is that they are currently just a bit expensive, a situation bound to change as the installed base widens.
In general, the hosting industry has made it through a bad patch and currently has lots of bandwidth to offer at good prices, there's an extensive and rapidly expanding high speed market looking for services, and you the webmaster have a ton of rich content all dressed up and waiting to go out-not a bad state of affairs.
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