Ask LH: How Can I Set Up My Own Hosting Service?

Ask LH: How Can I Set Up My Own Hosting Service?

Hi Lifehacker, I’m a student who just started doing some work on the side building websites for local businesses in my spare time — thanks for introducing me to Codecademy and making that possible). I’ve decided to look into hosting the websites myself as another form of income. How do I go about setting up a server to host websites? Are there student discounts for buying servers? Thanks, Host With The Most

Student picture from Shutterstock

Dear HWTM,

Our genuine advice is this: there’s not much money in setting up a full-blown hosting service yourself, but there is (potentially) a decent amount of pain. Hosting is a commodity market these days, and those companies that do make money from it do so because they have sufficient scale to handle large numbers of sites. That’s hard to replicate from your own home or even a small office, especially in terms of having decent connection speeds.

As you’re only dealing with small scale sites, we’d suggest setting up hosting through a cloud-based provider such as Azure or AWS. That lets you retain administrative control, allows you to host in Australia if you wish, and you can still opt to charge your customers a fee which lets you build in a decent profit margin. You’ll still gain the experience of managing those (virtual) servers, but you can let someone else worry about the hardware and network uptime. It’s also relatively inexpensive to set up a sample site and see what the likely monthly expenses will be.


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  • As somebody who has done exactly this, I have two pieces of advice:

    Firstly, for the love of God, DON’T!

    Secondly, if you do, in order to stand out you’ll have to provide amazing service. You can’t compete with GoDaddy (and similar) on price or on features. You can compete with them on service, but only if your service is better. This means that when a website goes down at 2am for no good reason, you will be getting up and fixing it. Trust me, this is not fun.

  • While it’s possible to buy a server and host personally, this is doomed to fail. As the cost and hassle factor involved in getting a symmetrical broadband connection and a dedicated IP, not to mention setting it all up and maintaining 24/7 simply doesn’t make sense.

    Which means HWTM is looking at becoming a reseller. There are some decent hosting companies with AU datacentres that offer reseller accounts. At least this takes away the hardware worries but not the need to provide constant, immediate customer support

    The profit margins are likely to be razor thin since most shared hosting options tend to be sufficiently generous and reliable that the average user will simply go with whoever is cheapest.

    I’d stick with continuing to offer a website design/set-up/install service. A couple of people I know do that and make a reasonable living from exploiting the noob/lazy factor.

  • Pretty much agree with the above comments, though if you are still up for it you could go with a reseller plan with a reputable hosting company. If you wanted to be a bit more hands on you could look at hosting from a VPS. There are a few places that offer full whitelabel reseller packages that inslude their own tech support as well which is pretty good. The best way to market this would be to offer a design and hosting package to your clients.

  • My first hand experience – becoming a reseller by buying wholesale hosting space is really the only option, and even then with AU-based hosting it’s difficult to be competitive.

    In my anecdotal experience, I have had a number of customers continue to pay my (more expensive) web hosting due to my service level, and if you can offer this, including basic (under 30 minute) website updates into your hosting cost.

    For example, by deploying a CMS and hosting it as a reseller, you can make basic website updates in less than half an hour, which helps to justify the additional hosting cost to a customer who is unlikely to be very savvy at updating their own site. That way you are paid for the site set up and design, and end up with an ongoing hosting/service contract that generally won’t require much upkeep. This won’t suit for every client, but I’ve found it works quite well.

  • I love the diplomacy… “That’s hard to replicate from your own home or even a small office…”
    Hard?, it’s absolutely, 100% impossible!

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