Changing Business Model of Web Hosting

With the advancement of technology and customer access, setting up your own web hosting company has gotten a lot easier, but the model is constantly evolving. 20 years ago, during the beginning years of the Internet, users were limited to a few web hosting providers. At that time, the size of the memory / hard drive was limited to between 35 KB and 2 MB, depending on the provider. With shared hosting, the average storage space was only 153MB. 

In the dynamic landscape of business today, technology and customer access are inseparable components that drive success. Technology has revolutionized the way businesses interact with their customers, providing unprecedented opportunities for connection and convenience. With the advent of online platforms, businesses can enhance customer access through e-commerce websites, mobile apps, and social media channels. These technological advancements enable customers to engage with brands anytime, anywhere, and on their terms.

Customer access, facilitated by technology, extends beyond traditional brick-and-mortar stores. Online marketplaces, digital customer support, and personalized marketing strategies all contribute to a seamless and interactive customer journey. In today’s highly competitive market, the effective integration of technology and customer access is essential for businesses seeking sustainable growth and a loyal customer base. By leveraging technology to optimize customer access, companies can remain agile, responsive, and attuned to the ever-evolving demands of the modern consumer.

In 2002, one of the leading Florida hosting providers had three servers in one bedroom. At that time there were 39 million websites on the Internet. We have 1.7 billion people and we are still counting.

According to Moore’s Law, devices that provide the Internet, from storage to bandwidth, double every two years. The internet started with a few hosting providers, but today there are thousands of hosting companies that have very similar hosting plans. The era of cheap dedicated servers and shared hosting is coming to an end and personal, cloud-based options are becoming increasingly popular. Gartner, the world’s leading research and consulting company, predicts that by the end of 2020, 41% of the workforce will be working on public cloud platforms.

With such dynamics likely to affect the web hosting business and every stakeholder involved, it becomes necessary for us to understand how the web hosting business model is set to change. If you are a reseller who has purchased a plan from one of the best reseller hosting providers, you should definitely read this article. So, without further delay, here goes. 

How easy is it to start your own web hosting company?

In all honesty, it’s not easy at all. Many advances have been made in the industry that has made building infrastructure for a hosting company much easier than in previous years. However, there are still stories of “summer hosts”, small hosting startups that mostly pop up at the beginning of summer and represent a younger and less experienced group of entrepreneurs. They have a bad reputation for starting a business, but they are leaving their database and business due to a lack of resources or technical knowledge at the end of summer. This makes us wonder how the web hosting business is changing?

Modernized automation devices like Docker, Openshift, CloudLinux, cPanel, and WHM robotize schedule, support, security, and monotonous tasks. These tools are somewhat new to the hosting business and are intend to make growing your facilitating environment simpler and easier to make do with fewer individuals. Web hosting organizations presently don’t require a total group of sys architects or admins. 

Reaching potential customers is more practical than ever and, thanks to social media and social media marketing, also possible with little money.

Paid advertising works for both small businesses and large businesses. Whether it’s a big company like Microsoft or a grocery market near you, anyone can use paid ads on platforms like Facebook and Google Adwords to reach a specific audience.

New business targeting offers advanced marketing capabilities that were previously only available to large, high-budget agencies. With paid ads, you can segment your user base and create interests and audiences that are align with your interests. You can also categorize whether these segments need more information. Or even if a customer needs a reminder to add an item to their shopping cart and return it.

Then there is Search engine optimization (SEO) which allows users to search for the information they are looking for, i.e. only visible when you use Google or other search tools. In addition, the Google Search Console offers tools to maximize the speed and visual appeal of your websites, as well as SEO rankings that support SEO and are more visible to more people. 

This is just a brief overview of the tools that entrepreneurs can now use for free. The situation of start-up web hosting companies is constantly changing and every company has to adapt to stay agile and competitive.

To succeed in the competitive web hosting market, having knowledge and experience in web hosting and systems management is crucial.

Automation, cost-effective SEO, and reduced marketing expenses have made web hosting more accessible to small and medium-sized businesses.

As of 2020, hosting companies can offer a completely different environment to their customers.

The web hosting business model hinges on your customer type; understanding your customers is crucial in this complex field.

Some popular customer-based web hosting models today

1. SAAS hosting business model

A decade ago, web developers and designers were the primary web hosting clients, alongside a growing small business market.

Today, various website solutions provide the SAAS (Software as a Service) model, catering to entry-level and SME markets effectively.

You no longer need to study computer science or design to create a website. These SAAS operating systems include domain registration, drag-and-drop site builders, e-commerce solutions, SEO optimization, and digital marketing.

To maintain that market share, most hosting companies now offer website builders and other managed solutions to their customers. Some of the world’s largest web hosting providers focus on complete SAAS service/website solutions rather than traditional web hosting models. The focus on customer solutions is the clear winner of the current host company.

2. Web-centric hosting business model

Web-based hosting is a popular business model, providing solutions for small shared hosting providers over the past decade and beyond.

The web-based model focuses on a single host market where you can spend 100 hours of your time and support.

The world of content management systems (CMS) has led to a focus on managed hosting for WordPress, Joomla, or Drupal.

To be successful in a web hosting business you need to be aware of changing roles and opportunities.

For example, the role of web designers and developers has changed dramatically. They combine design and technology, capture design files, convert them to code, and use technical and professional solutions. They work outside of traditional CMS and LAMP packages and require dedicated servers to implement complex JavaScript packages and applications.

3. The business model for cloud hosts

Large hosting firms are moving toward AI-powered, multi-server cloud solutions. Medium and corporate clients find cloud and hyper services appealing, and cloud access is becoming an industry standard. The future of web hosting is dynamic.

Compare Google search results for web hosting and Amazon AWS to gain a comprehensive understanding of cloud hosting.

Compare Google search results for web hosting and Amazon cloud hosting (AWS) to understand cloud hosting comprehensively.

Reseller hosting providers should adapt and adjust their plans to the evolving models and dynamics of the industry.


The web hosting industry evolves, leading to unexpected business decisions compared to our initial plans.

Starting a web hosting business is more feasible today, although it remains a challenging endeavor compared to two decades ago.

Here is hoping that you have understood how the business models in the web hosting world are changing. If you want to know more or have any queries about this article, feel free to share them in the comments section below.https://webzworld.com/

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