9 ms·

I've had a "droplet" going at $7/mo for about half a year and probably used it less than ten hours so far, and not doing anything too heavy when I use it. Ever

by biztos 7y ago

I've had a "droplet" going at $7/mo for about half a year and probably used it less than ten hours so far, and not doing anything too heavy when I use it. Every time I think about turning it off I say "yeah but it's only $7 and I like to ssh into it sometimes." I've had a "shared hosting" setup on Dreamhost for at least 15 years, also using pennies per month in capacity, at most. I get that it can be a brutal, low-margin business, but I also wonder how many "small" customers are extremely high-margin like me, and whether that can aggregate into a better overall margin than you might guess? Or will you always have a few outliers running at capacity and calling the help desk and blowing out your margins?

lozaning 7y ago
One of the interesting metrics from my time working in global escalations for one of the worlds largest electronics manufacturers is that most customers don't call in for support, but on average we get 3.5 calls per user per account lifetime. The 80/20 rule in in full effect here. The 'needy' customers are extremely resource intensive.
- ForHackernews 7y ago
  Unless you're a business that differentiates itself with good customer support, you can just fire expensive customers.
  - mandelbrotwurst 7y ago
    You could, but there would be a significant risk of serious reputational harm.
  - mywittyname 7y ago
    This is probably what I would do. Keep around the high margin customers like the OP, but do something with the Complainy Pants Inc; either force-migrate them to a higher cost service tier, throttle them until they leave, or maybe just slow down their service. The key to remaining competitive in cut-throat industries is knowing where to spend your limited time and money.
    - busterarm 7y ago
      And now you've discovered the business model for Planet Fitness.
      - fishtacos 7y ago
        "either force-migrate them to a higher cost service tier, throttle them until they leave, or maybe just slow down their service. The key to remaining competitive in cut-throat industries is knowing where to spend your limited time and money." How does this apply to Planet Fitness in any way?
        mywittyname 7y ago
        Lunk Alarms are exactly this: a mechanism for ridding your company of high cost / high maintenance users to focus on the more profitable ones.
- steve_adams_86 7y ago
  I've sat in on some really gross calls in which my CTO at the time berated DO support for issues that didn't _really_ exist in an attempt to get better rates, or practically yelled at them when minor hiccups occurred in our infrastructure. It was very painful to sit in on. They were remarkably patient and cool about it. I suspect there are many people like him out there sucking up their time and resources.
zippy 7y ago
you, personally, may be a high margin customer, but some, and perhaps a lot, of the $5/no customers are potential liabilities due to not patching software or libraries or choosing terrible passwords for their services, databases, etc. one decent incident can cost a multiple of a year's revenue for the account.
- jimmaswell 7y ago
  is this just about cpu power from exploits?
  - zippy 7y ago
    no, more like someone's instance gets pwn-ed and is now part of a botnet and DO is getting calls and or isp-blocked and has to devote staff time to the incident.
  - jethro_tell 7y ago
    in my experience, it's more about trying to keep your IP space clean for the rest of your customers and bandwidth. You either get your IP space blacklisted or some idiot starts burning 1Gbps on ssh attempts and you start getting abuse email from the .mil space which is awkward. Plus, you gotta pay for the bandwidth. That 5/mo customer is much more likely to disappear than pay for the data they used.
    - derefr 7y ago
      > That 5/mo customer is much more likely to disappear than pay for the data they used. Is there no such thing as prepaid, "the VM stops when your credits run out" VPS hosting? Seems to work well-enough for Twilio.
isbvhodnvemrwvn 7y ago
Shit, you've just reminded me that I have to finish some ansible playbooks I started in september. The VPS they were supposed to configure only had some hardening an no traffic since then.
sillysaurusx 7y ago
I’ll never forgive DigitalOcean for deleting my portfolio site after 5 weeks of nonpayment. 5 weeks. Deleted everything. Yes, I screwed up. But I would have happily paid them. They deleted the backups too. When we inquired as to whether the backups could be restored now that we’ve paid them, they said it was impossible. Blame me if you want and say it’s my fault. It certainly is; I admit that. But why was I paying them for backups that they wiped along with my server? Meh. (The card expired.)
- kbar13 7y ago
  "i was able to pay rent but i forgot and got evicted and it's the landlord's fault!!!!!111"
  - shard 7y ago
    I haven't decided whether DO did the right thing or not, but to be fair, your analogy should be more in the line of "they evicted me and burned everything of mine in the apartment".
    - freehunter 7y ago
      But landlords kind of do that... there’s even an entire TV show dedicated to it, called Storage Wars. People didn’t pay the bill for their storage locker so the owners of the locker sell off all the stuff inside.
      - penagwin 7y ago
        Context really matters though. Is the storage locker being bidded off because the owner died 5 years ago? What if the last payment was 8 months ago, and you haven't heard from the owner since? It's a completely different story if you were late by 1 day and they sold all your stuff the next day. I guess the question here is if DO waited long enough before deleting their droplet. They were over a month late, and I'm assuming they sent notifications....
    - adar 7y ago

by biztos 7y ago

lozaning 7y ago

One of the interesting metrics from my time working in global escalations for one of the worlds largest electronics manufacturers is that most customers don't call in for support, but on average we get 3.5 calls per user per account lifetime. The 80/20 rule in in full effect here. The 'needy' customers are extremely resource intensive.

ForHackernews 7y ago
Unless you're a business that differentiates itself with good customer support, you can just fire expensive customers.
- mandelbrotwurst 7y ago
  You could, but there would be a significant risk of serious reputational harm.
- mywittyname 7y ago
  This is probably what I would do. Keep around the high margin customers like the OP, but do something with the Complainy Pants Inc; either force-migrate them to a higher cost service tier, throttle them until they leave, or maybe just slow down their service. The key to remaining competitive in cut-throat industries is knowing where to spend your limited time and money.
  - busterarm 7y ago
    And now you've discovered the business model for Planet Fitness.
    - fishtacos 7y ago
      "either force-migrate them to a higher cost service tier, throttle them until they leave, or maybe just slow down their service. The key to remaining competitive in cut-throat industries is knowing where to spend your limited time and money." How does this apply to Planet Fitness in any way?
      - mywittyname 7y ago
        Lunk Alarms are exactly this: a mechanism for ridding your company of high cost / high maintenance users to focus on the more profitable ones.
steve_adams_86 7y ago
I've sat in on some really gross calls in which my CTO at the time berated DO support for issues that didn't _really_ exist in an attempt to get better rates, or practically yelled at them when minor hiccups occurred in our infrastructure. It was very painful to sit in on. They were remarkably patient and cool about it. I suspect there are many people like him out there sucking up their time and resources.

zippy 7y ago

you, personally, may be a high margin customer, but some, and perhaps a lot, of the $5/no customers are potential liabilities due to not patching software or libraries or choosing terrible passwords for their services, databases, etc. one decent incident can cost a multiple of a year's revenue for the account.

jimmaswell 7y ago
is this just about cpu power from exploits?
- zippy 7y ago
  no, more like someone's instance gets pwn-ed and is now part of a botnet and DO is getting calls and or isp-blocked and has to devote staff time to the incident.
- jethro_tell 7y ago
  in my experience, it's more about trying to keep your IP space clean for the rest of your customers and bandwidth. You either get your IP space blacklisted or some idiot starts burning 1Gbps on ssh attempts and you start getting abuse email from the .mil space which is awkward. Plus, you gotta pay for the bandwidth. That 5/mo customer is much more likely to disappear than pay for the data they used.
  - derefr 7y ago
    > That 5/mo customer is much more likely to disappear than pay for the data they used. Is there no such thing as prepaid, "the VM stops when your credits run out" VPS hosting? Seems to work well-enough for Twilio.

isbvhodnvemrwvn 7y ago

Shit, you've just reminded me that I have to finish some ansible playbooks I started in september. The VPS they were supposed to configure only had some hardening an no traffic since then.

sillysaurusx 7y ago

I’ll never forgive DigitalOcean for deleting my portfolio site after 5 weeks of nonpayment. 5 weeks. Deleted everything. Yes, I screwed up. But I would have happily paid them. They deleted the backups too. When we inquired as to whether the backups could be restored now that we’ve paid them, they said it was impossible. Blame me if you want and say it’s my fault. It certainly is; I admit that. But why was I paying them for backups that they wiped along with my server? Meh. (The card expired.)

kbar13 7y ago
"i was able to pay rent but i forgot and got evicted and it's the landlord's fault!!!!!111"
- shard 7y ago
  I haven't decided whether DO did the right thing or not, but to be fair, your analogy should be more in the line of "they evicted me and burned everything of mine in the apartment".
  - freehunter 7y ago
    But landlords kind of do that... there’s even an entire TV show dedicated to it, called Storage Wars. People didn’t pay the bill for their storage locker so the owners of the locker sell off all the stuff inside.
    - penagwin 7y ago
      Context really matters though. Is the storage locker being bidded off because the owner died 5 years ago? What if the last payment was 8 months ago, and you haven't heard from the owner since? It's a completely different story if you were late by 1 day and they sold all your stuff the next day. I guess the question here is if DO waited long enough before deleting their droplet. They were over a month late, and I'm assuming they sent notifications....
  - adar 7y ago