So I decided to see what slapping some ads up on the page would do for me. So I sort of slipped them in without any fanfare and watched the stats. What I learned, was that ads are not worth it. I mean, I don’t have any immediate need for money. I am not living off the land here. I don’t need the ads, but I thought it would be an interesting experiment.

I made about a dollar a day. I stuck my ads “below the fold”, which is an ad no-no, because I wanted to keep them away from content. What I mean is, I didn’t want the reading to be cut off by ads. And I didn’t want them to be blatant. Ads detract from content any way you slice it.

Furthermore, they are an insult to your readers. We, readers, don’t like ads for lots of reasons. One fundamental reason is that they are a jab at our intelligence. Do you really think that the place we go when looking for anything is your ads? I mean, the shit that filters through adsense is amazing. I mean, let me paste the ads on the front page right at this moment.

Weird.TV Videos Online
Weird, funny, stupid videos to send your friends—Free from MSN Video.

Last Holiday Movie
Starring Queen Latifah. Check out the Trailer. Now playing

First, adsense did a horrible job of categorizing my content. Granted this is partly my fault. I didn’t add a keywords metatag or jump through any of the other hoops that people who use ads normally do. But how hard can it be to get the general gist of my content? I mean the first paragraph on the page describes what it’s about. I know the scanning system cannot be perfect but come on, this blog has no penchant towards “stupid videos” nor Queen Latifah. I mean, I don’t hate Queen Latifah but, get the hell off my blog.

Second, they are stupid. I don’t think my readers are the type who would randomly decide that they need to see videos of some dumbass lighting his pubes on fire. Nor do I think I have a strong Queen Latifah fanbase.

Granted, if I were making real money on these ads, I would keep them. As anyone would. I don’t have ill-will towards blogs that use ads. Sometimes is just an easy way to make good money. You wrote the content that brings the readers, so you may as well get a little something in return. In adblock, I whitelist all the blogs I read that I think deserve some money for their work. And of course I click some ads. But if you are making 15 dollars a month, buddy, let it go.

80% of my readers use firefox. I think it is safe to assume that at least half use Adblock. That means that 40% of my readers don’t even see my ads to get the chance to click them. So check your stats, if they show that you have the type of readerbase that doesn’t tolerate ads, don’t put them up.

Would I be adverse to using ads ever again? No. But the right kind of ads. Ads that are visually pleasing, relevant to my readers’ interests, and non invasive. If I can find an ad solution that can serve good ads and won’t detract from my content while staying pretty, I’ll use it. It’s a tall order. But it’ll fit.

Bottom line, Ads don’t work everywhere. So don’t paste them up where they clearly don’t belong. A lesson learned by Koray, shared with you. Take the advice and run with it. Or don’t. Or comment and tell me why ads work everywhere. Tell me why there are 15 ads on the site you made for your grandma, and why it’s appropriate. That’s all for today. I need some more coffee.

Before I start this I want to say that I am not trying to stir anything up with Dreamhost or it’s Customers. I know for the most part everyone who uses Dreamhost loves it. What I am trying to do is understand their latest business move.

One TeraByte of bandwidth for under 10 bucks a month. Hah, why can’t more hosts do this? If anyone came up to me and said “Hey, my host is giving me 1TB of bandwidth for 10 bucks a month” I would say “You better drop your cheapo host then huh?”. No doubt they would reply “Hey! Dreamhost isn’t a cheapo host!” and I would tend agree.

This is a classic move made by two types of hosting companies. The first being startups. Startups that don’t have the money to pay the bills often make grand offers that no sane person would believe to drive initial sales up. It works until it catches up with them and they end up dropping customers.

The second type is soon-to-be-failures. It’s a desperation move. They notice sales dropping and they try to prop them up with the same unbelievable offers.

This is what confuses me. Dreamhost has been around since 1997. They are from from startups. And dreamhost hosts more than 190,000 domains according to it’s site, so it can’t be in monetary troubles. So why would they do this? Because they are good guys? Sure they are a hosting company with a friendly down-to-earth approach to doing business, but can they follow through?

1TB is a big big chunk of bandwidth. To offer some contrast, The cheapest server we maintain is $100.00. We have 100mbit burstable. And our bandwidth cap is 2000GB a month. Are you really telling me that a shared hosting plan costing >$10.00 can offer 50% of that? Yes you are. I’m not buying, and furthermore, for a meager 79.95/mo you can get 2.2TB. It doesn’t add up.

Do I think this decision will bite them in the ass? It’s hard to say. They aren’t stupid. They have survived in a business that changes constantly. And they have made a name for themselves on out of the ordinary offers. They have a 97 day money back guarantee. Weekly, every Dreamhost user’s bandwidth & space cap is raised. Yes those are all great, but this takes the cake. Thats a really corny cliche by the way, takes the cake. It really makes no sense. I only used it because I can’t think of something better right now. Just stop using it, for future reference.

This was just an interesting unexpected move, that I wanted to make mention of. It’s a claim that not many hosts can make. Even if this is a limited time offer. They don’t seem to have an affinity for writing checks they can’t cash (I am full of cliche tonight), lets hope it stays that way.

It would be nice to see an entry written about how they plan on supporting and executing this written in the Dreamhost Blog. I for one would like to know, I am (sort of) in the business after all.

Have opinions? Tell me. I know some of my reader’s use Dreamhost. Are you worried they are setting themselves up for failure, or are you happy you just got a huge jump in bandwidth? And I know I have a few industry watchers reading.. do you think this is a reasonable offer? I’m really interested in what other people think. After all, I may be blowing this out of proportion.

I went back and forth about how to approach writing this entry. I played with ideas in my mind, came up with nifty witticisms, formed paragraphs & structure. I knew I didn’t want to make a “looking back” post. However I did want to write about what I was looking forward to from the new year, both from this site and others.

Moving along.

This was an interesting year to say the very least. It was a year of change. I think I must of changed the site at least 5 times, ranging from simple redesigns to full blown CMS moves and a few domain changes. I know I said I didn’t want to recap this past year, but that needed to be said. I finally settled down and moved back to wordpress (which I love oh so much) and got the site together. And ever since things have improved at a rapid pace.

Now in 2006 I have amazing ideas that I want to reach fruition. But I am not going to make an idiot of myself by announcing them now. I do that all too often anyways. I guess I should list a few. Just a few. So you don’t get bored with me, and so this post has a point.

Multiple Authors

Gasp. This really shouldn’t be called “Multiple Authors” but I thought it might make your heart skip a beat. Conceited of me, no? In actuality, Koray Online will play host to a joint project of a friend and I. You see that new “Asides” section up there? Yeah you do.

I will change the title, and for now you can read some old, rather washed out, asides posts I made. But in the future this will be the home of said project.

It will be an “Around the web” type project that picks the best articles, stories, entries, news posts, and more from lots of sources. Me and my co-author will write an article about each one. The articles will all be a bit different in format of course. Some will be reviews, some will be summaries, some will be elaborations, and some will be something I haven’t thought of yet. I know you are saying “Koray, we have sites like this. In fact, most blogs do solely this.” but I don’t caaare.

We plan to do it better. Or at least we will say we do it better. I do want it to be a one stop shop of interesting and informative articles about interesting and informative articles. If you don’t like that, I don’t know, just ignore the section.

And to clear things up, The main page here will be run by me and only me still. But a section like the one proposed will require frequent good writing. Writing with a partner who I know and trust ensures I won’t spend less time on the main site.

If you have interesting ideas for this, let me know. I love ideas. I do want this to be something you bookmark or subscribe to, and if there is something I should do to set this apart let me know.

Other things

I also plan on continuing to make changes to the site. Upgrading features and the design. Little things really, nothing to get your panties in a bunch about. Just things to make browsing the site fun(ner).

Besides that, I figured I would let you know that I am moving my hosting to Media Temple. Why? 9rules has partnered with them and I figured I would hop on board. As soon as I get my site moved over I’ll throw my nifty “Partner” badge up and that will be that. Expect no more than an hour’s downtime when I attempt the move. Shouldn’t be too hard.

And as soon as I move, I will be upgrading to Wordpress 2.0. To facilitate multiple authors. I do want to get the new section under way as soon as possible.

I also wanted to mention Blogmad. As some of you may know, I am a beta tester for BM. I’m not usually a fan of traffic-trade programs, but this is so much more. Its a way to network, rate, find, and talk about blogs. And with the credit system, you can expect a 1:1 return on your traffic. Refer people, get traffic. It’s a great system.

I’m not going to start the hype machine now. I’ll write up a real pre-release review post sometime soon with some cool exclusive screenshots and a feature outline. But until then, you can read the Newsletter or read the DevBlog.

And finally..

I wanted to mention 9rules. 9rules just released Communities, which is an amazing way to find great content on the network. Taking the familiar categories to a whole new level, it allows content to be easier to discover. With planned Category “Experts” or leaders, to write articles featuring articles from blogs on the network. There is a lot more coming, but I am probably pushing it with what I have written already. Don’t want to give away too much. Please go check it out.

I know this entry was written pretty laid back. And it felt damn good. But I just really wanted to go over everything I had planned and it was hard to piece things together. So I figured I would just go with what I had. Expect more posts very soon.

Disambiguation is key in any business. If questions arise, answer them. You have to be forthcoming, absolute, and transparent. But questions shouldn’t arise. Being clear from the get go is how to get customers, in anything you do.

Be honest

I find myself saying this all the time, people are not stupid. Don’t put your company on a pedestal, don’t make yourself seem too terribly distant, and be truthful. Don’t promise what you can’t deliver.

I am a firm believer in a more grassroots humble marketing effort. Word of mouth works wonderfully in the hosting business, and I imagine it applies to a lot of things. Winning over the people is smart. Be a humble company, people like that down to earth feeling.

Be professional

Just because you should be humble, doesn’t mean you shouldn’t have your shit in order. You can’t expect people to stick with you when you offer less than promised. People have expectations, being clear is the best way to avoid expectations you can’t fulfill. Don’t claim to have a staff of 500 when you have 5 of your friends working the phone line. People will know the truth after they end up speaking to Jim five times in a row.

And people will know you don’t own a datacenter with 5,000 racks when they, and everyone else hosted with you, share one IP.

Perhaps the most important element of appearing professional is the web design, especially for net based firms. A clean professional design screams “You can trust me, I am not a guy in russia waiting to run off with your credit card.” Having an out of the box, poorly functioning, badly designed site is not good for business. Would you buy from “Just Another Generic Company #432″?

Work your shortcomings as features

This is standard practice for some, and crazy to a lot of others. But don’t be afraid to market your downfalls as positives. This is another plus to the “Clean and Clear” method of doing business.

You don’t have to have 500 people working for you. Spin it and say you have 5 dedicated support technicians who work full time to get to know each customer and their problems. And say you have 2 dedicated IT guys, who work day and night to monitor each server and diagnose each problem. Suddenly a familiar name becomes a welcome thing. Instead of your customer going “Wow this must be a budget company, I’m not sure I like this” they find themselves going “Oh! I got Jim again! And look, he remembers my name, and he even knew which server it was without me having to dig around for the crazy 10 digit server ID that every freaking datacenter seems to have.”

Only have a few servers in operation? Thats fine. Let them know. You be sure to tell them that you have 5 of the very best servers co-located in some of the best datacenters around. Explain that this lets you keep prices down, and support top notch. Because its easier to diagnose a problem when you are working on 5, rather than 5,000. What usually makes this approach desirable by the customer, is when you say you only take a certain amount of customers at any time. This gives them that very important sense of familiarity, comfort, and safety. People like being at the center of attention. This also saves you from growing pains. Trust me it hurts when you have too many customers for the hardware.

Have A Purpose

Always have a mission. And let people know your mission. If you say “We are here to provide such and such a service, for such and such an audience, at such and such a price, with priorities on such and such.” you clear up a lot of people’s questions from the start. Believe it or not, it is not cool to be mysterious and shady.

This also lets you keep your eyes on the prize. Changing priorities as a company is not a good thing to do. Jumping around from specialty to specialty makes customers wary of your abilities. Don’t be a web design company one day, and a marketing firm the next. By all means grow, expand on to new things, but don’t up and drop something.

Put emphasis on support

This may go without saying, but you need to be putting a lot of time and effort into support. I don’t care what industry you are in, support is what makes or breaks a company. Sure a good product doesn’t hurt either, but support is what brings in those refferals.

A lot of companies talk about their industry leading support. If your company is 5 months old, you don’t have industry leading anything. This is the kind of stuff that gets companies in trouble, don’t make baseless fact. But I digress, I guess, put support on the frontburner.

Have knowledgeable people answering phones and emails. I hate it when I need to get referred to a “specialist”. Why the hell wasn’t I talking to a specialist in the first place, don’t all problems require a flipping specialist? Why do I need a middle man to tell me I need a specialist? I think I know.

Answer emails timely. In fact, right away. I don’t care how large you are, there is nothing that warrants a 7 hour turnaround on questions. In anything I have done, I have never been so under staffed and over worked that I couldn’t have someone answer an email within 30 minutes.

I think thats all for this post really. It was just meant to touch on a few important notes, and offer a bit of advice. I’m sure I jumped around a bit too much, and I am sure I was a but redundant on more than one occasion. But I think you get the general idea, and you may have picked something up. Now on to other things..

Whats going on at the rules

First up, two contests with two pretty cool prizes are taking place. Both by fellow 9rules members.

The first contest is for an entire year of (mt) hosting, along with a possible Flickr Pro account or a $20 iTunes card. You can read up on the contest at PaulStamatiou.com.

The second contest is for an entire set of invincible comics. You can read up on that contest at Freak Comics.

Erraticwisdom has compiled a list of the 10 best redesigns of 2005, you can check it out here and Digg it here.

Lastly, Phu Ly of IfElse has launched his new photoblog. It has an excellent design, and so far, great photography/commentary. Check it out here.

So I spent almost all of last night restoring and repairing a partner-company’s server after it got hacked. I feel bad for the owner because his sys-admin left him and he is pretty green in the tech part of the job.

So I first had to search for a way to copy the backup files from a slave drive back to the primary. Sounds easy right? No. Cpanel doesn’t work like that. Which made it hard.

I had to mount the backup partition, rsync everything in /home and all the apache, bind, etc files. It took ages. And then I had to update cpanel and apache. Then I had to run chkrootkit to be sure he wasn’t rooted. I finished up by hardening php, obscuring some things, and hardened /tmp.

Whats my point? Practice security. Run Chkrootkit every day. Have a good firewall. I suggest visiting eth0 and doing just about everything. This guy had no security and he got hacked. So yeah, please just do some of the basic things that really decrease your chances of being hacked.

What else.. hmm. I guess thats it. I’ll write something that you actually care about tomorrow or something. This was just.. something that bothered me so I got it off my chest.

So after much deliberation, we have decided to downsize CollateralFX.

As many of you know.. I started a ‘hosting’ venture a while back with a few friends. It started out pretty small but rocketed upwards in a short amount of time. Of this, I am most proud. We managed to do what many upstart hosting companies can’t do: grow.

But now we have grown to such a level that the rewards of our business don’t merit to work we put into it. I mean, I love most of our hostees but we have reached a point where we just put too much of ourselves into this.

So yes, we are downsizing. Dropping monthly hostees at month-end and moving yearly hostees to a smaller box of their own until their payterm expires. The company will all but disappear once the yearly hostees’ terms expire.

But there is good reason for this. We are regrouping, strategizing, and refocusing our efforts in the niche hosting market. This includes Game servers, Shoutcast servers, Chat servers, Ventrillo and Teamspeak server, etc. We will get a DBA and rename our company Lithic Servers. Yeah, we spent tons of time coming up with that name.

The market for these things is just not as saturated as the plain jane hosting market. Less competition and less work. As lazy as that sounds, the less time we spend wasting time on server maintenance and the like the more time we have to spend on the individual hostee.

As for a bit of proof, take this bandwidth graph of our hosting server. Compare it to the bandwidth graph of our gaming server. As you can see, the bandwidth difference is amazing.

Anyways, I have gained a lot of wisdom throughout this little experiment and I thought I would share it with those of you looking perhaps into starting your own hosting business.

1. Don’t start as a reseller. As cheap and easy as it seems, you will only lose money in the longterm. People are smart these days, and they know they can get it cheaper straight from the horses mouth. Not to mention they want to talk to the provider, not the middle man. Go for a dedicated server to start with.
2. Be sure you have money. Hosting is not a “Get Rich Quick” business. It requires a lot of time, patience, knowledge, and money. You are going to have a lot of unexpected expenses, not to mention the obvious ones.
3. Your datacenter is your lifeline. Be sure to do a lot of research on your datacenter before deciding to lease a server. They must have an excellent support policy. If you don’t have support from them, how can you support your customers? I suggest LayeredTech. I really do. Right now, they are the best out there. In my humble opinion of course.
4. Try to move to co-location when you get bigger. Pretty soon your demand will catch up with supply and you will be forced to turn away customers. The best way to deal with this is to purchase a server and co-locate it at a datacenter. This way all you pay for is the space and the bandwidth. Costs will drop and profits will rise once you are able to buy your own hardware.
5. Be professional with support. People don’t want you to be their buddy. I am not trying to say you shouldn’t be friendly, but if you try to hard to be personal friends, they will realize you don’t have much of a support staff. They want cold hard support. Fast and efficient. But don’t be afraid to throw in a “And have a nice day” at the end of your emails.
6. Love it. If you don’t love what you do, you’ll want to close up shop real fast. You have to love the hosting community. The hosting atmosphere. And the customers. If you can’t get joy out of providing hosting for your customers, you are making a mistake. Because thats pretty much the only reward you get for a long time. Money isn’t instant.

Take this advice, and file it away. It will do you a world of good down the road.

And as a side note: Anyone I am hosting right now, as a friendship type thing, will keep their hosting. Don’t freak.

First off let me say, some of us are people people, and some of us are not.

Case in point, Nick, my co-founder at CFX. He is a great Sys-Admin, and he does great support. But when it comes to dealing with ornery customers he just can’t do it. Now I will admit the customer has to be very ornery before Nick flips but, still.

Today I had a potential customer IM me asking about Shoutcast Servers. I explain my rates and where the servers are located and what hardware they run, etc. and he tells me its all fine and dandy but my co-worker has a bad attitude.

A few pasted conversations later and I see what he meant. Nick more or less flipped out on this guy for asking the most inane questions. And not just questions, he accused Nick of scamming him and trying to pass a reseller as a real server because we let our resellers bind their name servers to our shared IP.

Anyways, Nick was pissed and this guy was cocky as all get out but I think we came to an agreement. He then went on to tell me streaming music without a license was illegal but a few lines from the copyright act quickly changed his tune.

ANYWAYS, my point is, if you are pissed off easily, don’t go into customer relations.

I also wanted to talk about a few other things but, I totally forget what they were. So.. they will have to wait.