They’re Internet History

Well, that’s it. Yahoo! is finally shutting down GeoCities.

This is a sad moment for the Internet in general, and it’s especially sad for us. I’ve always felt a sort of special connection with GeoCities.. lemme ’splain you.

GeoCities was one of the first web hosts on the Internet, being started as “Beverly Hills Internet” in 1994. About four months before we started New Dream Network, in December of 1995, they became “GeoCities” and started offering FREE hosting.

By the time I had heard of them, we were already offering some PAID hosting, and I remember thinking something along the lines of “Damn it! They’re cheating!”

How could a bunch of (completely) broke college kids afford to compete with somebody just giving away hosting? At the time, I figured it could never last.

I was right.

15 years and $3.57 BILLION later.

But that’s not the only reason GeoCities has a special place in our heart.

The main reason is WebRing!

WebRing was a free service for people with related sites to automatically trade links, written by co-founder Sage (it’s not just me and Dallas around here!) back in 1994, while he was still in high school!

A couple of years later when he ended up at our college and we conned him into our play-company, we helped him run WebRing on our server(s).

WebRing itself never officially became a part of New Dream Network, since Sage had started it on his own years before. What we got out of it was Sage wrote DreamBook for NDN and put links to it all over WebRing!

In 1997, WebRing was starting to grow too big for us full-time college students to handle, especially with our newest little project taking off.

So, Sage got Starseed, Inc. to take it over for him. A friend of his from high school worked there and they made a deal where Sage got a percentage of Starseed, an annual “consulting” stipend, and certain creative controls, and they took over everything to do with WebRing.

It didn’t take long for Charley, the head of Starseed, to figure out that the best chance to make the most money off of WebRing was to sell it and sell it fast!

Greetings Geocities

And, sell it he did… to GeoCities!

I believe originally the offer they were going to accept was around $1 million.

However, irrational exuberance was on Charley’s side, and the timing couldn’t have been better for everything that happened next.

At the last minute, another bidder came to the table.. GeoCities however, decided they simply must have WebRing, and closed the deal at around $3.5 million!

Of course, this was all for GCTY stock options, and I’m sure they (rightly) figured that it wasn’t real money anyway.

Now the Starseed team (plus Sage) just had to wait and see which came first, the vesting of their options or the popping of the bubble…

The Vesting

Well, while everybody was nervously holding onto their approximately 1% ownership of GCTY, a funny thing happened. In January 1999, Yahoo! bought GeoCities for $3.57 billion, putting GCTY at more than ten times what it was when they did their deal!

And so, Sage’s options in GCTY were now converted over to YHOO. He still had another year before he could cash them all in though. And things were already a teeeeeensy bit over-valued.

Luckily, by the time Sage was able to cash out (and he did) in early 2000, Yahoo! had tripled yet again… meaning that Yahoo! had effectively purchased little old WebRing for about $100,000,000!

The Downfall

So, Yahoo set a team onto merging WebRing into their system.

By 2001 they were done, and everybody hated it.

Users were dropping faster than YHOO stock, and in 2002 an engineer from GeoCities bought WebRing back from Yahoo for an undisclosed sum (rumored to be around $10,000!)

Since then, I don’t really have any inside information on what’s gone on with WebRing. Just from the Internet Archive history, it looks like he more or less kept the Yahoo look and ran it “respectably” until around 2005:

… when they started to really pimp it out for ads!

Then in 2007.. Social Networking!

And today… Web 2.0!

Reminiscing

WebRing’s been around just about as long as the Web, and now that I ponder it, has been a sort of microcosm of the Web the whole time.

It went from a tiny ad-free community service, to hyper-growth, to showing ads, to being acquired for an INSANE price, to being forsaken, to doing anything to survive, to “social networking”, to “web 2.0″, to today!

Back in 1998, who would have thought WebRing would outlast GeoCities? Who would have thought DreamHost would outlast GeoCities?

DreamHost acquires Geocities

Well, not really. The thought sort of crossed my mind, “If they sold WebRing to that one guy, maybe they’d sell GeoCities to us!”

But then I realized.. Yahoo understands the only real value in GeoCities left is those millions of potential upgrades to PAID hosting.

If you go to GeoCities right now, Yahoo! has a big ad for their ($12/month) hosting.. with the first three months half off!

Whoop dee do.

“In honor of WebRing” or something, we are now offering to the first 1000 GeoCities users who sign up TWO YEARS of a completely free DreamHost account (including domain registration)!

No strings attached.

All you have to do is verify you are an existing GeoCities customer by creating a page on your GeoCities account (or editing an existing page) to have the phrase “I’m off to DreamHost!” on it!

Then when you signup for us, simply put the full url to that page as your “promotional code” and you’ll get a 2 year plan (normally $214.80) free!

And we promise to never shut down.

Free Hosting from DreamHost is Here

When we started DreamHost back in 1997, we were in it to make money. Throw up a server, get some customers, collect fat checks, retire at 35. Simple!

Somewhere along the way (I think it was shortly after the fat checks showed up) we developed a conscience and decided – No fat checks!

For us it wasn’t enough to just not be evil – we realized that the only way to really feel good about ourselves was to lose money hand over fist, and just hope that we broke even somewhere along the way…kind of like a non-profit!

We took a multi-pronged approach to Operation Money Loss! We resolved to:

• Provide our employees the most comprehensive health insurance package we could find, free.
• Give away free hosting to non-profit organizations.
• Match customer donations to selected charitable organizations.
• Offset our carbon footprint through the purchase of renewable energy credits and carbon offsets.
• Provide financial support to open-source projects that we use ourselves – Jabber, MySQL, Linux-VServer, and grsecurity to name a few!
• Consistently offer ridiculous coupons that, even now, seem like a bad idea.
• Keep all our company cash in the stock market.

I’d call that a good start, but it’s just not enough.

Today we’re announcing DreamHost Apps, a completely free hosting service for web-based applications.

Well, it’s free for now anyway. We’re flirting with the idea of a $50 yearly fee once it’s out of beta…but if you sign up RIGHT NOW to help us test things out we’ll let you use DreamHost Apps for free for ever!

But wait! If you’re reading this and you’re already a DreamHost customer (and why else would you be reading this), you don’t need to worry.. you can already log in to DreamHost Apps with your same DreamHost Web Panel login!

For you, it’s really just an Ajax-ified way to manage your easy one-clicks and any domain registrations. But, for the hundred or so people out there who’ve read this blog and aren’t DreamHost customers… but do want some free hosting of a WordPress Blog, Drupal Site, Zenphoto Gallery, Mediawiki Wiki, and/or PhpBB Forum (plus Google Apps and Gmail) and aren’t afraid to do a little “beta testing” (and unlike some other web shops, when we say beta, we mean it), today must be your BIRTHDAY!

Right now usage of DreamHost Apps is by invitation only. Lucky for you I like your face and I’ve posted about 100 invitation codes in the comments of this post. If a code doesn’t work, it’s already been redeemed – try another one! When the codes run out, I may even post more!

If you’re a current DreamHost customer you’ve already had access to DreamHost Apps for months! That’s because the exact same functionality (minus the free part) can be found under “Easy Mode” in the “Goodies / One-Click Installs” section of your account control panel. There’s no need for you to sign up for DreamHost Apps because you’re already living the dream!

DreamHost Apps customers do miss out on a few perks that paying DreamHost customers take for granted, though. Apps users can just forget about FTP access, SSH access, email, and even technical support.

DreamHost Apps is provided ‘as-is’, and unfortunately technical support is not part of the ‘is’!

You try providing tech support for a free service and let us know how that works out.

For all intents and purposes, DreamHost Apps are entirely self-contained.

You can install and delete any number of apps through the DreamHost Apps management interface, and you’ll use each Apps’ own web-based interface to make application-level changes. Upgrading to full-featured hosting is just a click away!

DreamHost Apps was assembled over the course of a few months by a small team of four hardworking DreamHost Employees, Pete V, Mike P, Joshua H, and me, Brett D. In fact, this is the first major DreamHost project that Josh Jones hasn’t been personally involved in writing in a very long time, so rest assured that your data is safe and your credit card won’t be charged more than it should be!

If you find any bugs, please post them over in our DreamHost Apps discussion forum.

We’ve been working on this for a while, and we’re kind of tired. We’re just gonna take a quick little nap if you don’t mind…

Please enjoy DreamHost Apps!

Speaking of scheming…

Sucks Sites.

I’m sure you’ve seen them. Wikipedia calls them gripe sites. They’re usually set up by disgruntled customers and then typically disappear a few weeks later once the creator has had time to cool down.

Oh yeah, they’re out there. NoDaddy.com, for example…but in their case it turns out they may actually be on to something!

Thanks to some great investigative journalism by Andrew Allemann over at Domain Name Wire, you can now read in great detail the lengths that GoDaddy has gone to to conceal its involvement in its own domain name warehousing operation.

Standard Tactics, LLC: How GoDaddy Profits from Expired Domains

The Go Daddy Group allegedly uses a complicated web of subsidiaries and anonymized whois records to hide its involvement in its domain warehousing/auctioning scheme.

Check it out. It’s a great read to get you into the Christmas spirit. If you’re the Grinch.

I guess when you’ve got a $2 million Christmas party to throw and a $3 million Super Bowl commercial to put on, that money’s gotta come from somewhere!

Democracy at DreamHost

As you may know, DreamHost was selected for the WorldBlu Most Democractic Workplaces 2008 list.  We’ve talked about it a little in previous blog posts, but have never really said much about the specifics of democracy at DreamHost.  I’ll start things off with a bit of an overview of the concepts of democracy that apply to how we run things.

Democracy?

When I first heard about WorldBlu and their list of the most democratic workplaces, the concept was new to me.  At first I was even a bit unsure how what I knew about democracy as a concept even fit in with what I knew about workplaces.  I knew DreamHost had been doing things in a unique way all along, but it hadn’t occurred to me that it might be part of a larger trend.  To figure out how it all fit together I did a bit of my own research, and here’s what I found.  Democracy as a concept has a few key ideas that I think are the most interesting to us here.

Access to Information 

Crucial to democracy is easy access to information.  For a workplace that means information about things like what the business does and how they do it, and how it was done in the past.  It also includes information about policies and past decisions, and anything else that might provide insight about the business.  This goes beyond the scope of what a person needs to get their day to day job accomplished.

Free Exchange of Ideas and an Open Dialog

A free flow of ideas and information is what democracy is really all about.  The theory is that flow of ideas will lead to decisions that will be in the best interests of the majority of the people while also not infringing on the rights of the minority.  In a business the best interests of the majority are sometimes difficult to define, but with an open dialog the interests of the business itself will be more in line with the individual interests of the workers.

Opportunities for Meaningful Participation

That open dialog and exchange of ideas can’t be just a dialog with no real weight, though.  It has to have the potential to have an impact on the decision making process, and the functioning of the company itself.  It has to be meaningful or it won’t be successful.  

Democracy is Not Just Voting

This is a key idea.  I think a lot of people here in the US might say “Democracy is Voting”, but voting is really just an implementation detail of the representational democracy we have here.  In the workplace democracy model voting may be useful as a participation tool, but it’s definitely not necessary.  In the case of DreamHost voting is not widely done, though we do have a polling system built into our own internal employee tools and it does get used to gather votes on specific issues.

How To Make Money

I know what you’re thinking, “Finally, a DreamHost Blog post I can USE!“

HA, you wish! Here we go…

Apart from being a mint, it seems to me there’s really only one way to make money.

Banking.

And I don’t just mean get money, like from people depositing it with you. Nor do I mean earn money that already exists, like you would from say, working or investing.

No, I actually mean it: MAKE NEW MONEY!

The fact that banks can actually create money is why they’re such a great business.. and also why the recent crash has been so hard.

How It Works, As I Understand It.

(Correct me if I’m wrong.)

For the purpose of this explanation, imagine there was only one bank in the world (which is actually a pretty good approximation, thanks to all those overnight intra-bank loans we’ve been hearing so much about in the news).

Let’s say their first customer ever, Joe the Plumber (yes, THE Joe the Plumber) comes in to Bank of the Universe, and deposits his meager savings of $250,000 (now FDIC insured!).

Great! Bank of the Universe (BofU) now has $250,000! Enough to run things for .004 femto seconds.

But, it hasn’t earned $250,000 .. it still owes that to JTP. And it definitely hasn’t created $250,000.. it just received it as a deposit. In fact, things aren’t too great for BofU at all … it probably has a deal to pay Joe some interest on that deposit. It’s also got to hold that cash / gold / pvc piping for Joe, pay rent on some buildings, employ some customer service people, manage a network of ATMs, and weave dozens of golden parachutes.

Not Great!

Which is why BofU has to make loans! Let’s say average guy John McCain comes in and needs a quick $250,000 for some campaign he’s running. “Sure,” says BofU, “you seem like a stand-up guy and this isn’t Fall 2008, take the $250,000 at only 5% interest!”

Well, now BofU is at least going to earn $12,500 a year! But.. they’re also kind of screwed when Joe Wurzelbacher comes in to get $20 for a back-siphon for the s-trap he’s funnelating.

But They’re Not

Because remember, BofU is not only the Bank of the Universe, they’re the only Bank of the Universe.. and so John just kept that loan in his account with them! And when he does spend that money, whomever he spends it with is just going to deposit it right back in their account with BofU!

In fact, just by making a little “John McCain owes us $250,000 at 5% interest” data base entry, BofU has now not only earned themselves $12,500 a year, they’ve also added $250,000 to the universe’s money supply!

Right now, BofU would be leveraged 2-1 (they owe Joe and John $250,000 each, but they only have the $250,000 Joe deposited in the bank). But, everything is fine. In fact, everything is so fine, they can go ahead and loan out that $250,000 AGAIN (maybe to Barack)!

And again!

And again!

And one more time!

And then?

And then?

And then?

Again!

It took thousands of years for banks to realize this, but when they’re big enough, they not only don’t need to back up their deposits with gold, they can actually pretty safely leverage their deposits at ratios of like 30 to 1, 50 to 1, or even 100 to 1.

And, the banks can earn a ton of moololah from this too. Not 100 to 1 (just because they’ve created this new money, doesn’t make it theirs), but at least 5% on that 100… instead of just 5% on that 1.

It just works out that very little of that actual money needs to be withdrawn by people on an average day.. and when they do there’s always those short-term inter-bank loans to fall back on!

(Except for in Fall 2008.)

But, despite the infrequent aberrations, overall I’d say it’s a pretty good system that works. It results in a much more efficient use of assets, which allows for faster growth and more “economic development”, than if everybody just did like the Russians and just hid their money in their sombreros.

And I should know, because we CREATE disk and bandwidth the same way!

As I may have mentioned before, we offer a lot more disk and bandwidth than we actually have on hand. We’re sort of like a “bank for computing resources.”

Of course, nobody deposits disk with us, but we go out and buy a little, and then sell a lot, and then nobody uses it. And in the end, for all intents and purposes, we’ve really turned that little disk space into a lot!

And, it’s a useful service because if everybody had actually gone out and bought that lot of disk space themselves, they wouldn’t have used 99% of it, and it would have been a waste! A big waste! A universal waste!

And so, we’re “leveraged” in disk. And we’re “leveraged” in bandwidth. And we’re “leveraged” in CPU. And the ratios are a lot more than 100 to 1.

And it works.

But.. when does our Fall 2008 arrive?

Should Be.. Never.

As similar as our businesses are, there are a few key differences between Banking and Hosting.

For one, we don’t owe our computer resources to our customers like banks do their money. We bought them. So there can’t really be a “run on the host” with everybody saying “give us back our disk and bandwidth we bought!”

For two, there can’t even be a “run on the host” .. what, is there going to be some awesome Internet news and suddenly everybody’s website gets 100 times the traffic and uses 100 times the disk?

For three computer resources are not money. Although it may be nice for us if they were… even if we were to somehow (remember, 100% hypothetical!) run out of disk or bandwidth or CPU, we’ll still have our money. And that means our people can still get paid, and we can buy more resources, or we can rejigger something, or whatever… but when a bank runs out of its leveraged resource, bam.

That’s It.

And I don’t just mean that’s it for the bank, I mean that’s it.

For this blog post.

Period.

(P.S. I hope all that stuff I said about banks is right.)

See Dallas Talk

I have a couple of talks coming up at events that you might be interested in. The first one is at WorldBlu Live , coming up in New York City next week, Thursday and Friday October 16-17, 2008. In their words: WorldBlu LIVE is the only conference in the world that connects you to directly to the top leaders of organizations on the WorldBlu List of Most Democratic Workplaces™ as well as other thought-leaders and mavericks who will share their unique stories, best practices, and leadership strategies for building a world-class democratic workplace.

I’ll be speaking about how democracy is used within DreamHost and how it makes our business stronger. A bit of DreamHost history will be thrown in to provide some basis. I’m looking forward to this conference and I think there will be a lot of really cool talks from really interesting people. Some of the speakers that stood out to me are Tim Westergren, the founder of Pandora, and Philip Rosedale, the CEO of Linden Lab (the Second Life people). Those are two companies doing things on the Internet that will have a long-lasting impact, in one way or another.

The other talk is in Atlanta on November 12-14, 2008 and is at php|works, a PHP conference with a sister Python conference, PyWorks, running simultaneously. I’ll be talking about how to optimize web applications for the users of shared and VPS hosting services like DreamHost. It’s an hour long talk so help me out by showing up with LOTS of questions. There’s a lot of other good talks too, and I’ll be there the whole time.

If you’re in NYC or Atlanta around those dates come say hi!

Hot off the presses

Earlier this year DreamHost was named as one of only twenty five companies worldwide to be recognized as having a democratic workplace by the WorldBlu Organization.

What’s that mean? It means that we listen to our employees. It means we’re transparent in how we do things and why we do them. It means that, coincidentally, we’re also a great place to work!

Axiom News of Canada recently recognized our commitment to the democratic workplace in a three-part series.

E-meetings Engage all DreamHost Employees in Corporate Decision-Making

We really don’t have too many meetings around here. We use email lists. A lot. We don’t restrict employees from joining any list – in fact, we encourage it. If someone in tech support wants to listen in on our developers or system administrators, they’re welcome to do so! If anyone has a suggestion for system improvements, or a general comment about our operations, it shows up on an email list first.

DreamHost’s Unique Profit-Sharing System Results in High Morale, Strong Retention

We’ve literally been giving our company away since the very beginning. Every DreamHost employee is issued units in the company. (Units are kind of like the equivalent of ’stock options’ for an LLC.) At most companies those options are sold to employees at a discount – but not at DreamHost. We just go ahead and GIVE them to our employees at no cost. Once you’ve been working here for a reasonable amount of time you’re actually made an owner of the company!

Flat Management Structure Promotes Productivity, Retention at DreamHost

There are no cubicles at DreamHost. Our open-door policy springs from our roots as a dot-com startup, when teams were small and titles were meaningless. Our teams have grown since then and we’re still not too big on titles, but one thing we haven’t done is closed the door on inter-company communication.

We’re honored to have been recognized by WorldBlu and Axiom News. It’s a good feeling to see people interested in promoting what we’ve considered to be basic business practices from day one.

DreamHost really is a great place to work, and we’re always on the lookout for new talent to add to our team. If any of what you’ve just read appeals to you, be sure to check out our open positions and send in your resume today!

Crazy Domain Insane

There’s something I’ve always hated about the web hosting business.

No, it’s not the cut-throat competition, the crazy customers, or the California climate.

And NO, it’s not the 5-hour work week NOR the oodles of money either… those are fine.

It’s the domain names.

(And, by extension, ICANN.)

The problem with ICANN, as I may have mentioned before, is that they are an organization created to serve a need that just doesn’t need serving.

They do get things right once a decade though, like finally fixing the “domain tasting” problem.

But do they really need meetings in Fiji, Geneva, South Africa, etc…, along with a $20 MILLION annual budget to finally do what registrars had been telling them to since the Clinton presidency?

And now, ICANN’s made a bold new move that they claim results in “a massive increase in the ‘real estate’ of the Internet.”… the open creation of new TLDs (top-level domains).

So… what does this “open creation of new TLDs” actually mean.

Well, what it DOESN’T mean is that you’ll be able to go to any registrar and just register joshisawesome.believeit. Which is too bad, because if that were the case, everybody would finally have to belive it.

Nope. Instead, all that’s happening is now “anybody” can apply to start a new TLD… as long as they explain to ICANN how it will be used, prove to ICANN they have the technical prowess to run a registry, and pay ICANN an estimated $100,000 to $500,000.

Call me crazy cuckoo, but I believe that’s exactly how the new TLD creation process works now!

You know .info, .biz, .coop, .asia and all those other new TLDs? Pretty sure those went through a process exactly like ICANN is describing now for future TLDs.

In the announcement they did say that people aren’t going to be able to register trademarks (like .pepsi), nor offensive words (like .dreamhost), nor I assume TLDs less than 3 letters (like .i).

What exactly is changing here?

As far as I can tell, the only thing ICANN is saying is that they’re finally standardizing the process for applying for new TLDs. The goal I guess being to make it faster and easier to add more and more TLDs in the future…

Which is to whose benefit?

Have you ever met a person (or company) not involved in the domain name industry suggest the need for a new TLD? Ever? I haven’t!

There is honestly no demand for new TLDs (besides that for newly created countries, which are known as ccTLDs, and are not what we’re talking about here) from anybody who doesn’t stand to make money from the registration of domain names.

And that is because there’s only one thing that makes a particular domain name desirable for legitimate use: clarity.

That’s it. That’s why brand names and generic word domains are valuable, that’s why short domains are valuable, and that’s why no matter how many new TLDs are created, everybody still wants .com.

It is a huge obstacle for any TLD to offer a domain that is clearer overall for its intended use than some still available .com. Blame it on consumer ignorance, but I know I’d still rather have jjflowerslosangeles.com than flowers.la.

(And who types URLs anyway these days?)

Again I must ask, all these new TLDs are to whose benefit?

As far as I can see, the only possible beneficiaries are those actually in the domain name monetization industry.

More possible TLDs means more possible typos, more defensive registrations by trademark holders, and possibly some money to be made from the few suckers who don’t realize that flowers.la is not a clear domain.

What new TLDs will be made?

Hmm… we’re not going to be seeing company-based TLDs (e.g. .ibm, .coke) anytime soon; I doubt IBM is that interested in switching over from ibm.com. And since ICANN announced people can’t register trademark infringing TLDs, IBM won’t have to do it defensively either.

I guess I could see a case being made for TLDs that better categorize the type of site being visited, perhaps things like .blog, .wiki, .forum, .shop. Except, we’ve already got sub-domains for that!

In fact, www.blah.blog is exactly the same number of characters at blog.blah.com; all we’d be doing is switching a .com for a www. (And don’t try to say people would just use http://blah.blog/… that’d be even less clear!)

Not to mention, where you once had just one domain name to manage (and pay for), you’ve now got dozens… all with different registries, different rules, and probably different expiration dates.

Maybe there’s a case for making more location-based TLDs, perhaps things like .nyc, .sf, .miami, .toledo. But again, we’ve already got the country-code TLDs, and besides, isn’t the Internet supposed to be international? Just use local search to find local stuff.

(Can you really see people just guessing the URL “www.taxi.chicago” directly on their iPhone 4G. Ha, it is to laugh!)

What about price?

I don’t know if ICANN is going to just charge just a flat fee per TLD, or if they’re going to keep charging a per-domain fee like they do now. If it’s the status quo, then there is really no hope for interesting new uses of TLDs.

If, however, there is no incremental fee to ICANN for more domain names… welcome to the dawning of the age of domainius! Free domainius, that is.

Of course, any free TLDs would have to be tied to some particular application, otherwise squatters would immediately register every possible domain and put them up for auction.

I can see a free email provider getting .mail, a free blog host .blog, a free photo site .pics.

(There’s not that much of a benefit in having josh.blog as opposed to say, josh.blogger.com … but I guess since you’re going to be the 10,000,000th result on Google, you might as well go for the shorter URL!)

Auctions Smauctions

Did you see recently that the guy in charge of domain auctions at GoDaddy was discovered bidding up their own auctions?! That is some real bush league crap; to be totally expected throughout the entire domain name industry.

In fact, in case this blog post isn’t loooooooooong enough for you, let me now take a moment to relate a personal anecdote of mine about a domain auction.

Back in January, my wife was starting a floral design business, and had decided upon a name for it. Unfortunately, the obviously best domain name for her website was already taken, and being used by a squatter on sedo.com. Rather than dealing with them, she just registered a slightly longer variation that was still available.

Well, her birthday was coming up, so I decided to see what it’d cost to get that “best” domain. I went to the site, clicked the link to “make an offer”, and entered $100.

Immediately my bid was rejected!

It said the minimum offer the owner of this domain would accept was $777! Highway robbery!

After thinking about it for a little while, I figured, what the hey, it’s a birthday present, and I want to see how this thing works, so I made a (completely insane) bid for $777.

Automatically the system responded saying the owner had made a “counter-offer” back… $7770!!!

(How iiiiiiiiiiiiiiinteresting… sedo has a completely automated system for domain owners to counter-bid on domains.)

Well, harrumph. I raised my offer to $800. Immediately I got a “response” from the seller staying firm at $7770, and that was their final offer!

At this point I was curious… would they lower their price at all? So, I countered back with what I pretty much figured was the most I’d spend for this (completely of no value to anybody but my wife) domain, $1150.

What happened next really surprised me… I got another automated message stating that I had surpassed some secret minimum offer the seller had set at which they were, no not willing to actually sell the domain for, but at which they were okay with automatically putting it up for a seven-day auction on the front page of sedo.com… and my offer was the starting “bid”!

Gee thanks!

That explained why there are so many domains on that page with just one bid yet really high prices!

Well, at that point I figured I’d just sit and wait… nobody else was going to be bidding more than $1150 for this obscure domain name! And, the auction was ending the day before my wife’s birthday anyway, so the timing worked out.

I waited the whole week, and of course, nothing happened. The auction was going to end at 8:04 AM on a Saturday, but I didn’t even plan on waking up to watch the end.

Whoops. When I did wake up, at 8:12 AM, I (sneakily) immediately checked on the auction… only to find that somebody else had won; with a bid of $1175 at 7:56 AM!

I wasn’t horribly upset; after all $1150 was an order of magnitude more than I’d intended to pay. But I just knew in my gut of guts (I have four) that the winning bidder was either the original seller, somebody working for sedo.com, or somebody who figured I’d pay even more to buy it from them later! One thing I knew it wasn’t was anybody intending to actually use the domain.

You’re still here?

That, in a large ostrich nutshell, is why I hate domain names. The secondary domain name industry exists purely to squeeze profit from consumer confusion, artificial scarcity, and literal extortion. No actual value has been added to the universe, just a redistribution of money from people who have a valid use for a clear domain to people who registered that clear domain first.

And this is not, I repeat not, sour grapes of wrath by me, just because back in 1994 (when I first discovered whois) I checked all these big public company domain names like honda.com, toyota.com, and mcdonalds.com, (I wasn’t too creative back then) and found them all to be AVAILABLE.

I thought to myself, “Whoa. These companies would probably pay hundreds of dollars for their domains in a year or two!” To top it off, way back then domain names were completely free… you only had to apply for them with Network Solutions.

But, I decided against it, entirely because I thought it’d be sleazy. I swear it was not because I was afraid of getting sued, nor because I didn’t actually know exactly how to apply for a domain.

Nope, it was solely due to my irreproachable morals and incredible dignity.

You see, I decided to take the noble path and start DreamHost Web Hosting, where we earn our money fair and square: through over-selling, over-charging, and, every once in a long while, even over-blogging.

May de Mayo

Hey, you know what’d be fun on a boring Monday in May? A little role play!

And I’m not talking about 12-sided dice and renaissance faires either, I’m just talking about some simple role reversal.

More specifically, I’m going to complain to you about a web host!

So, about three years ago I was trying out some competitors to, you know, test the waters in case I ever decided I wanted to switch hosts.

I used three places, and they all absolutely stank. I mean, they were horrible. I’m talking worse than us!

Every server I tried with these places was pretty much just not working. Besides that, their support was all universally useless, and their panels were a weird hodge-podge of different systems they’d cobbled together I guess. You also either couldn’t get shell access or had to fax them your driver’s license to enable it?!

The worst thing was, they were all difficult to cancel, and a few even tried to get out of giving me my money back (I was in their “unconditional” guarantee!)

Finally, I decided to splurge (I’d been spending like $7.95/month) and tried a VPS place for a whopping $49 a month!

Well, they were great! I mean, they still had a weird hodge-podge of different panels, and they sure laid stuff out differently than I was used to, but my VPS at least stayed up and I could do anything I wanted.

I never needed to contact support, which was fine with me, and luckily for them, I never really did too much with the account but kept paying them anyway for the last three years (I’m willing to bet a few of you are in this boat as well… thanks!)

Finally

Last month, I finally decided to transfer my little bit of crap I had with them over to a DreamHost PS! When I went to cancel, I decided to check my credit card statement and noticed that for February and March I’d been charged $89 instead of $49?!!

Eh? I searched through all the emails I received from them and the only thing I could find that seemed possibly related was one that mentioned they were upgrading all the features on their VPS, but don’t worry existing users would get them all at the same price!

So, I wrote them a nice email:

Helllooooo….

I just noticed this and that somehow you guys upgraded me without my permission from $49/month to $89/month!

Uh, what happened? It wasn’t my choice.. I did get one email saying resources were going up .. for FREE.

Please refund the extra $80 you’ve charged to my credit card asap.

Also, I’d like to cancel my service as of April 30th, I believe what I’ve already been charged for.

Thanks,
josh!

To which they replied:

Sir,

On 02/17/08 our support team notified you to tell you that your server had run out of resources, and that the only way they could keep your server from staying offline was to upgrade you. They did so for free for one week, and asked you to get back to them to work with them to resolve the issue. They stated that if they didn’t hear from you they would leave you on the higher package level instead of leaving you down completely.

After a week, and a followup reminder sent to this address that the account was being left at Signature level so that you could remain operational, your package was upgraded.

Admittedly this was an atypical situation, but most would probably agree that after not hearing from you the decision to leave you up and operational was preferrable to the decision to simply let your server fail.

As per the contract you agreed to at signup, we do require a 30 day written cancellation notice to close down your account. I can accept this as that notification and close your account 30 days from today, on May 18th. I hope that this helps.

All the best,
Christian

Ha, ha, ha… what?

So, because I was (somehow) crashing my own (private) server, they, without permission from me, started charging me an extra $40 a month, so it wouldn’t crash!

Gee, thanks guys!

I also appreciate it when my cable company notices that I haven’t been enjoying HBO and Showtime and most would probably agree that after not hearing from you the decision to give you all these great movies and original tv series was preferrable to the decision to simply let you suffer with Oxygen and TBS!

But actually, that never happened becuase that would be CRAZY!

I went back to look for this alleged email, and I found it:

Subject: 7 Day Trial upgrade to the Signature package for yourserver.com.

Hi,

This server has reached it’s limit on i-nodes which is number of files on the system.

Below is an output of where most of these I-nodes are being used:

357219 -> /vz/private/1753/root/var/qmail/mailnames/yourserver.com/user/Maildir/cur
457677 -> /vz/private/1753/root/var/qmail/mailnames/yourserver.com/user/Maildir/new

That is roughly 700,000 i-nodes for this mail account. Please clear this mail out and notify us within 7 days so that we can downgrade your account back to the Essential. Otherwise, you will be billed for the Signature package.

Thank you,
Tommy

First off, nice subject! No wonder I didn’t read that email!

Ah, I see.. I had a catch-all at the domain hosted there and it was filled with three years of spam!

It’s besides the point that there’s no mention of inode limits anywhere on their site or tos (I’m not saying who they are because there’s no such thing as bad publicity!), or that I guess their VPS solution has problems with some instances affecting others in certain inode-related areas.

The point is that it is crazy to assume that you may just UPGRADE your customer without hearing back from them, as opposed to say, just DISABLING their account.

I wrote back:

Hi Christian,

Um, actually no, I would have preffered to have the server fail.. I’m sorry I didn’t see those emails, but I did not agree to the upgrade!

Please refund the $80 extra dollars and set my service to cancel on May 18th, after downgrading back to the $49 plan for the rest of the time.

Thanks,
josh!

To which Christian replied:

Josh,

I understand that some people may feel this way. That’s why we gave you free time at Signature level before keeping you there, and the opportunity in successive messages to go ahead and downgrade. We made multiple contact attempts and then provided the service, which you used for two months.
I’ll need to look into the possibility of refund. I’m not sure what the protocol is offhand, so I’ll need to do some digging.

I’ll downgrade your account immediately but if the same problem exists I expect your server to start failing again shortly. If it does, you’ll need to upgrade an I won’t be able to authorize a free upgrade – not with a dispute pending. So make sure that if the server fails and you’re comfortable with that, that if you change your mind you will need to explicitly agree to the new $89 per month rate.

-Christian

HA! Man, at this point I was starting to get bemused and maybe even a little bit angry. Here I am, a guy who totally loved this host, had paid them about $1800 over three years while using virtually no resources, and they’re going to make me fight over $80 at the end?!

Especially when they have no chance in actually keeping it. I happen to know as something of a dabbler in the web host arts myself that it is very very hard for an Internet merchant to win a chargeback dispute with a consumer! My next email brought this up:

Hi Christian,

Please refund the $80 or I’ll have to take it up with my credit card company directly! Yuck!

Thanks,
josh!

Oooh, but he was not intimidated!

Josh,

I will need to take this up with our Controller. My personal opinion is that you were given clear and fair warning of the charges which were not put in place until after a lengthy period in which we provided that upgraded service for you free of charge. We made multiple efforts to contact you and it was your responsibility to keep your contact information updated with us, or in this case keep messages from your provider whitelisted so that we could communicate with you. As you were given plentiful and frequent notice of the upgrade and the consequences for not responding, as you utilized the resources and received benefit from them through multiple billing cycles, and as all of this can be documented, I am certain that we could be victorious contesting a chargeback request. However, as I stated previously this is not my call. What I will do is send this along to our Controller for review, and set your cancellation date to May 18th as promised. Though normally it is not allowed to downgrade and provide cancellation notice at the same time, given the odd circumstances I WILL allow that request to stand, which will save you some funds.

I hope this helps,
Christian

Oooohohhohoohoooo! Well! I hope it helps too! I am so grateful you are now allowing me to “downgrade” to the only plan I ever signed up for!

Anyway, long story short, they said it’d take two weeks to decide, so I contacted American Express and disputed the charges, and then a few days later they credited my $80.

And the moral is, billing issues are the biggest issues for consumers! Why burn up three years of good will at $49/month over $80? Before this, I honestly would have recommended them to people if I hadn’t been their direct competitor! I swear!

People can forgive a lot of bad service/bad product/headaches/incompetence/gross negligence if you just give them back their money. It’s kind of like saying, “the deal is off,” no hard feelings?

It is 100% worth it. Now, when they talk to their friends, they’ll be like “Well, I had a bunch of problems, but in the end they gave me my money back.”

As opposed to me who’ll be like, “They were fine until the end when they stole $80 and refused to return it! I PLEDGE ON MY UNBORN CHILDREN THAT DREAMHOST SHALL CRUSH THEM!”

That’s something that translates across all businesses too, because it’s just a universal way of doing business. It doesn’t matter what industry you’re in, nor what product or service you have, there are good ways of doing business, and there are not so good ways.

And I feel like although we don’t always succeed 100% at the specific details of trying to offer awesome web hosting for super cheap, we are generally successful at running a business that doesn’t lie, cheat, or steal, and always tries its best.

Now, you guys be me and please go write a ton of blog posts I can use the rest of my life.

Thanks!

Let’s get Earthy

Today is a day for celebrating the air that we breathe, the land beneath our feet, and all the creatures that call this blue ball ‘Home.’

We’re really sitting on something special because from what I’ve heard there’s not a lot of blue balls out there.

Today is Earth Day!

And to celebrate, we’re doing nothing! Not a thing. We’re not even singing to our plants.

We must hate the Earth and be horrible people, right?

Wrong!

We’re not doing anything special because we already rock the earth-friendly workplace every day!

With this being the Earthiest day of the year, it bears repeating that DreamHost is a carbon neutral company. In fact, we’ve been carbon neutral for an entire year!

To date we’ve neutralized over 2800 TONS of carbon emissions and are on track to wipe out a total of 3400 by June of this year.

To give you some idea of just how much that is…One ton of emissions are created when you…

• Travel 2,000 miles in an airplane.
• Drive 1,350 miles in a large sport utility vehicle.
• Drive 1,900 miles in a mid-sized car.
• Drive 6,000 miles in a hybrid gasoline electric car.
• Run an average U.S. household for 60 days.
• Have your computer on for 10,600 hours.

source

All those servers in our datacenter use up a lot of juice – life-giving electrical juice which in turn is created by burning lots of dead dinosaurs. And therein lies the problem!

We’ve already switched to using lower-power CPUs in our fleet of hardware, and just last year we introduced DreamHost PS!

A DreamHost Private Server gives our customers a greener alternative to truly dedicated hosting. Why get (and pay for) a complete dedicated server when in reality you may only need a fraction of its resources? On-demand resource scaling and flexible pricing ensure that servers aren’t sitting idle, sucking up all that dino-juice willy nilly. Customers can apply for PS hosting now from their web panel.

DreamHost PS represents a new earth-friendlier way of doing business and we’re proud to be the kind of company that’s able to offer it.

And remember, if you’re a DreamHost customer and want the world to know that your own website is green, just visit the Home > Green Hosting section of your DreamHost account control panel to get some green icons. After all, what good is being green if you can’t yammer on about it to anyone who will listen!

By the way, thanks for listening to me yammer on!