What Happened to Industry, Why Everyone Need Everything Soo Cheap ?

I agree, the cloud has taken a bite out of both colo and dedicated pricing!

I think it comes down to competition too–someone sees that a company has a server for $99, they price the same one for $89 to steal customers. Eventually it leads to a slippery slope where you’re pricing at ridiculous rates hoping that you make money over the long run all because you wanted customers in the short term.

The proliferation of the cloud vendors doesn’t help the dedicated server market either, as noted above. So now you get competition from outside sources, forcing you to price maybe even LOWER than you were already at just to stay competitive.

It’s the .99 cent menu, basically.

No you dont, remember people do business with people and not websites. Stop selling online and meet people and they will gladly pay you $20 a month for same hosting. Thats the traditional way of doing business, uptill last year we did not even have a functional website but we did have lots of customers who know me and my team personally.
If someone does ask me to match price or sell cheap, I am more than happy to refer them to list of providers who would be good fit for their budget.

Blaming young people – society’s answer to everything since…well, forever

Don’t budge, offer a first month discount, let them go get their cheap ass server, wait, they will leave and either come back to you or go elsewhere, cheap will not win, not many if any cheap providers seem to have a good service.

Don’t sweat it, just tell them why you cost more and won’t budge and let them get their cheap crap

My rule and today another person came back after trying cheap, they didn’t like it.

A few things missing here.

(1) Good is good enough, not only the quality of hardware has improved, also software needs now much less support then years ago. And if you really only need 10min the first month during setup you ask yourself why you should pay premiums for years.

(2) Competition, yes lots of and almost no way to make a difference. You can’t even do it the Apple way and sell pink colored servers (oh well it works someway if you offer MacMini Colo – people pay premiums).

(3) Prices and profit margins down everywhere except lifestyle and some business products. Grocery stores have a 3% margin on products.

(4) Low interest rates on credits. Good for buying hardware, makes it even possible to strech the break even for new hardware from 12 month to 24 month. See OVH with their new storage products (we discussed this topic in a previous thread). If you get a 5 year warranty on the products and a 5% interest you can calculate differently.

(4) The 99% problem with accumulated money in the hands of just a few. I guess almost everyone here were to busy trying to make a buck instead of following the political disussions to understand what is terrible wrong in the world right now. The majority of people are poor as a church mouse and more are coming because money is not generated by work but only by taking credits and with a credit saturation it’s more and more difficult. Some startups have an insane amount of money but the masses have not. One rich customer is not making you happy, but 1000 middle class customers do. But the middle class is dying.

In the end the problems here are the problems you have everywhere because it is not a failure of the hosting industry but the political economical system. Capitalism is unsubstainable and not working anymore. It needs new markets (imperialism) or new technological discoveries which causes more demand. And we have seen nothing new in the last decade and there is nothing new coming (except 3D printing and maybe biotechnology but even nanotechnology isn’t new but just an optimization).

Prepare for impact.

Yeah this is pretty spot-on, although people would rather complain about “people these days are so cheap and expect so much for so little”, rather than accept that the tech sector has literally existed in several bubbles where it was possible to extract unreasonable amounts of capital in a way that they no longer can.