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Thursday, November 18, 2010

The Good, the Bad and the Ugly Marketing of US Hosting Providers

A few months ago when we were about to launch our first web application to the public, we were evaluating a VPS (Virtual Private Server) solution.  Fortunately (or unfortunately), the local hosting providers were quite expensive and technically inferior compared to the US-based providers.  In addition, we try to avoid providers that require 12-month contracts.  We don't want to be stuck with problematic providers for a year if we find out they cannot deliver what they promise during the first week after we sign up.

Doing the shopping requires a  lot of reading on the internet, then actually signing up and see if there are surprises.  It was an interesting exercise.  We realize that every company has a different marketing personality and we are able to categorize these personalities into the good, the bad and the ugly.

The Bad
Dreamhost
Some comments around the internet gave high marks to a US-based provider called Dreamhost.  So we went ahead and tried to sign up.  During the signup process, after we entered the credit card, clicking next didn't seem to take us to the next step and there was no error message.  We didn't know if the transaction went through or not.  After a few minutes, we logged in to the Dreamhost account management system and found that our account was indeed created, but it was in a pending status.  What happened here?

It didn't inspire much confidence for customers that there was trouble getting past the very first step.  So we decided to do nothing and see if Dreamhost knew a problem had occurred and took proactive action to contact us.  So far Dreamhost didn't contact us.  Until today we are still able to log into the Dreamhost account management system with our account status as pending.

We have no way to know if Dreamhost is a good provider.  What we do know is that a technical problem had occurred and Dreamhost didn't know about it.  Can they find out problematic accounts by scanning their account management system?  Probably.  But to us that doesn't matter.  We left and probably would never go back, and we will discourage anyone from signing up with Dreamhost.

Rackspace
Next we went to Rackspace.  It is another US-based hosting provider and was credited for providing hosting services to Youtube.  It has opened a local office here and its website has a localized web domain.  We visited their local website to check out their plans.

So their first plan caught our eyes for 4xx dollars per month.  It was a great deal because the hardware options were extremely powerful.  However we had a question on the contract terms.  It didn't say if the price was only valid if we signed a long term contract.  We tried to contact their sales.  There is a link on their website that launches some kind of a chat window.

After a while, a live sales "person" came online at the other end.  We asked about this particular plan and asked if we needed to sign a long term contract.  This other "person" asked if we had trouble signing up and could walk us through the signup process.  We said we only wanted to ask if we needed to sign a long term contract if we wanted to get the 4xx dollars per month plan in our local currency.  This "person" then said the price was in fact in US dollars, not our local currency.  We asked how that was possible.  We went to their local website and common sense said that it should be in the local currency (since there's no US$ in the front).  This "person" said they are a US company so every dollar value is in the US currency.  So this "person" made the assumption that local customers coming to this local Rackspace website know that Rackspace is a US company, and hence only the US currency should be used.

We were quite annoyed by that time.  This "person" wouldn't stop but kept saying he/she could walk us through the signup process for that plan.  We politely said if you had put a simple US$ in front of the prices we wouldn't have this "conversation".  You wasted our time.

We tried to ask simple questions but were bombarded with pushy behavior to get us signed up.  It was also funny that such a "big" company had trouble using the right currency on their website (now I think about it, maybe they did this on purpose).  That sure is an effective way to push potential customers away.

Openx OnRamp
We needed to serve ads from our web application with the openx ad server and we wanted to see if the free Openx OnRamp service can help us.  We submitted our application to use this service.  For many days we didn't hear anything and one day we got an email from openx telling us that we downloaded a white paper from openx and asked us to contact them.  First of all we didn't download any white papers from openx and you were lying.  Secondly, please tell us if you had denied or approved our application.  The silence is killing us.  Well it doesn't matter anymore because we will never use this service ever again or recommend it to anyone.


The Ugly
We tried to find a hosting provider that can provide hosting services for our openx ad server.  The name Arvixe kept popping up so we decided to sign up to see if it could meet our needs.  Their plans are very reasonably priced and there's no contract.  Customers can pay month-by-month if desired.  We opted for a monthly payment option just to test Arvixe out.

After signing up and logging in, we immediately went to install openx in our hosting account.  The installation is done through another software known as Softaculous that can be launched from the Arvixe account system.  After the openx installation, we realized that there was a problem with the openx plugins.  So we contacted Arvixe's customer service by submitting a ticket through their support system.

Arvixe has a 24-hour customer service team so within a few hours we got a response.  It told us to reinstall openx in our hosting account.  We did that but the problem was still there.  We contacted customer service again.  After exchanging a  few messages, one of their staff said that we had to get support from openx and they couldn't help us resolve the problem because openx is a 3rd party thing.

It is always easy to blame someone else for your own problems.  We said Arvixe advertised openx hosting.  Now you are telling me to go somewhere else for an installation problem which obviously came from your own system.  We even googled the problem for Arvixe and the problem might be related to Softaculous.  We asked Arvixe to resolve the problem with Softaculous, but if you insisted us to go somewhere else to solve this problem, we wanted a full refund immediately and we would take our business elsewhere.

We reinstalled openx again for the one last time and to our surprise, the openx plugin problem went away.  We started putting in ads to the openx ad server and so far it is able to serve ads properly without problems.

We were about to leave Arvixe but somehow they quietly admitted their fault and quietly fixed a technical problem without telling us.  We will wait and see but we are staying with Arvixe at the moment.  But it doesn't give us a warm feeling that we were told to go somewhere else for support.

The Good
We were hoping to give Dreamhost our business but we couldn't even sign up.  Perhaps our fate was destined to find another hosting provider.  We were very glad we did.

We found the following US-based company Linode.

We had never seen such a clean and error free signup process.  It accepted our credit card (we are outside the US so we thought our credit card might have caused Dreamhost the glitch) without problems.  Once we paid we were given full control to our virtual private server.  In a few hours we were up and running.

Linode doesn't require customers to sign a contract and we can pay month-by-month.  So far we have zero problems.  In the future when we expand we may signup more servers with Linode.  We are not afraid to recommend Linode to our partners and friends.

Lesson Learned
Some companies like Linode are technically superior.  This is a big marketing win because it gives potential customers a safe feeling that their businesses are in good hands.  Some companies are technically challenged.  But that doesn't matter.  What matters is companies can take a step forward, own the problems and solve them, instead of ignoring them or telling their customers to go away.  Some companies just want to close sales using whatever means and simply won't listen to what their customers are saying.  Whatever these different companies do, it has a big impact on their company's brand images.  Potential customers may never be their customers.  These potential customers may tell their partners and friends never to patronize these companies.  Losing 1 potential customer can mean losing 10 more potential customers.

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