Unmetered bandwidth in the shared hosting environment. A new trend? A new concept?

Why this article

A certain rather well known and fairly reputable hosting company that was offering budget hosting switched to offering shared hosting with unmetered bandwidth usage. Soon after that we heard of another company, with even more experience than the first one, switching or at least experimenting with a similar offer.

This resulted in at least two long threads at Webhostingtalk.com, discussing this type of offer. I participated in those threads - I just had to - but I've also decided to express my point of view here, for you to read. Besides, as a side effect, I'll be able to put my thoughts in order.

Unmetered vs Unlimited

In the shared hosting arena the word unmetered has its share of fans. Often times when discussing the use of the word "unlimited", people have argued that it's just a matter of semantics, that it must be obvious to anyone that unlimited hosting can't be really taken at face value, so there's no harm done when hosts use it in relation with bandwidth or space. They argue that unlimited means "as much as a regular/normal/standard/average website may need". Thing is, there is no true standard/regular/normal/average website.

Some people acknowledge the fact that unlimited is not an acceptable word to use when describing bandwidth, that it can be considered deceiving, but sustain that "unmetered" would be the right term for it. Well now, let's see, is it really?

Unmetered means -- in this context -- "unmeasured". However, some of the companies offering it explicitly mention an initial limit that once reached will be upgraded upon request (no charge). So their system does in fact measure the data traffic consumption. What they don't do (or claim not to do) is to put a limit to the consumption. True, they don't do that - at least not directly.

Reasons for hosts to offer unmetered bandwidth

Back to basics: a business exists to profit. That's its purpose, and the role of its employees is to do whatever is needed to maximize profits.

So, how would offering unmetered bandwidth increase profits? By sheer volume. Significantly increased sales with smaller profits per account could potentially translate into higher total profits.

In the case of serious businesses, the decision to gamble by offering unmetered bandwidth is based on mathematical reasoning and it's a calculated risk: statistics - the cornerstone of all rational overselling decisions.

However, hosts have devised a way to not take that risk, for in order to qualify for unmetered bandwidth a website must fit certain requirements. But, I get ahead of myself.

Why would unmetered sell better than a quota?

Obviously it's all in the perceived value, for it's never what you sell, but what the customer thinks he's buying. The targeted customer (for there is a certain type of customer at whom this offer is aimed) will feel that he gets more for less. After all, isn't unmetered bandwidth supposed to give more than its fixed quota counterpart?

Another reason is one that I heard from the customers themselves: they don't get to worry about being charged for going over their bandwidth allotment. It's a sort of guarantee that higher traffic won't translate into higher charges. It's risk reversal all over again -- or at least that's how they see it.

The business proposition ultimately is: "Worry-free hosting! Sign-up now and you don't have to worry about hosting ever again! You'll get everything you need for a fixed fee."

The target market

Obviously there must be a target market for all product/service offers and it doesn't take much to suspect that the target market in this case isn't formed by the people with websites that will take advantage of the full power of the offer.

To ensure that things will be manageable, certain types of websites are typically not eligible for unmetered bandwidth:

- Those that offer file downloads (software, video, mp3s etc.)
- Those that host image galleries (they are notorious for both high bandwidth and high server resources usage)
- Those that contain popular forums
- Portals and other types of communities
- Adult websites
- Chats

It's also relatively common to see a restraint like "90% of the files must be linked from HTML/PHP/ASP etc. type of pages." Translated, this means that the website must be content driven.

*Note that some hosts are more restrictive than others and some are less restrictive, meaning some go to greater lengths to protect themselves while others are willing to take more chances (we'll see if it's really so).

Most of these restrictions are also used by the hosts offering unlimited bandwidth, which is not that strange if we remember that unmetered bandwidth in shared hosting is almost directly derived from the concept of unlimited bandwidth.

Now, if we examine those restrictions, it's very hard to imagine a website that can use huge amounts of bandwidth (to actually take advantage of the unmetered bandwidth offer) and not fall in one of the categories above. So, what's the point then?

Well, the point is simple. Unmetered bandwidth as such would be overselling taken to a whole new level. However, in order to ensure profitability (or long term sustainability if you will) hosts have taken these very serious safety precautions. In my opinion, the more restrictions the more I feel it's talk the talk but rarely - if ever - walk the walk, meaning they make it virtually impossible for a customer to take them up on the unmetered bandwidth offer.

Why? Well, it's not just because of all those limitations above. Should it happen for a website to get through that maze of rules and end up being eligible for unmetered bandwidth, the host will still stop it from taking what would constitute the true advantage of the offer.

There's one clause that gives the host all the power, one clause that is above all the others. "One ring to rule them all." That is the "server resources abuse" clause, for everything bows in front of this little but powerful rule.

If your website uses so much CPU power and memory that it affects the performance of other websites on the server, the host will suspend it.

You might ask yourself: Why go through all that trouble of specifying types of websites that are not eligible if you have this clause?

To answer that we must look at the effect of those limitations: Only websites with very little chances of using over a few GBs per month are eligible for the offer. As a side effect, those websites stand little chance of tripping over any resources abuse threshold. So the mighty powerful clause will most likely be very rarely used - and this is a great thing for the host.

Often times customers have no idea what's written in the TOS (such a boring read puts off almost anyone) and that clause comes to them as a shock, especially as with most control panels of today there's no way to verify the host's claim. In that shock they might publicly voice their dissatisfaction of having their website suspended, and being "blackmailed" as some put it into upgrading their account. That's a kind of publicity most hosts can do without.

How do they, the hosts, explain it?

One idea is that bandwidth limits are no longer meaningful, that much more meaningful are for example the usage of CPU and memory. As per the description of unmetered bandwidth the ultimate thing that limits bandwidth consumption is the amount of server resources used.

Personally I would have little against this change, provided that:

1. The individual data transfer consumption would indeed not be monitored by the host.

2. The resources usage would be measured and visible in the control panel so that the user will be able to know at any time if he used too much resources that month/day/hour/instant or not. Also the user should be guaranteed a certain level (share) or resources.

If the first condition is not satisfied, then the very idea of unmetered is disputable. After all, if you sell something and you meter each user's consumption, why call it unmetered? However, one might say this is not that important. That it's just semantics. Maybe.

But speaking of semantics: based on the underlying definition, unmetered bandwidth as it is currently advertised is in fact the old unlimited bandwidth repackaged in a nicer, somewhat less deceiving wrapper.

Now let's take a look at how things have arrived at this point (unmetered bandwidth I mean). As one WHT user (Umbillycord) used to suggest in his signature, the bandwidth allowances have reached such huge dimensions that this bandwidth quotas war starts to make little sense, especially when the whole war is fueled by overselling, rather than decreases in real costs.

Instead of increasing the bandwidth each month, in a never ending attempt to either be cheaper than the competition or to simply keep up with it, a person might semi-rationally come to the conclusion of just calling it unlimited/unmetered and be done with it.

This is what happens (at least in part) with this unmetered bandwidth trend. The limits of overselling have been pushed times and times again and the bandwidth quotas along with it -- the next ground breaking limit to be used becomes "no boundary".

One idea that I like

I like the idea of shared hosting being limited by the amount of resources used, instead of bandwidth. Unfortunately measuring bandwidth is a tough to break standard.

Limiting plans based on resources rather than bandwidth would be a step forward in the industry and it would make all the difference between unlimited bandwidth as it had always been advertised and a true new concept that could be named "shared hosting with unmetered bandwidth and specified server resources".

Everything from the customer's perspective

Leaving aside any subjective factors, let's try to weight unmetered bandwidth and see if we can use it to our advantage (our because I'm referring to us, the customers).

Unmetered bandwidth often comes in the price range of approximately $10, from a host that specializes in budget shared hosting. The main benefit of unmetered hosting: no worries for small sites that they'll go over their quota and pay huge amounts for the extra bandwidth.

However, considering that most sites eligible for unmetered bandwidth would hardly go over 5GB of monthly data transfer, the same effect could be obtained by signing-up for a plan with 10Gb of transfer at $10 or so, which is easily achievable.

Life shows us that more often than not, hosts that charge more per Gb of transfer provide a better service overall; the ratio of $1/GB of data transfer is often times considered as the point from where a host can make a profit without overselling.

The only possible (a more appropriate word would be "remote") way of getting more out of a plan with unmetered bandwidth is to have a website that fits the restrictions and manages to consume high amounts of bandwidth while using low amounts of server resources.

My way

It won't come as a surprise that I'm not pro unmetered bandwidth plans in their current form. If I were to choose between buying a plan that suits my website's needs and one that comes with unmetered bandwidth, I would go for the one that fits my bandwidth requirements.

Sure, everyone can decide according to his/her own priorities or point of view, but for me unmetered bandwidth in shared hosting is not yet the revolution I was expecting. No, I'm not waiting for the ultimate budget hosting offer. I'm waiting for a change in the way server resources are sold.