Originally posted by Webdude
Offering $5 a year?? Man, any host offering that is reaching in desperation for business. That's as plain as day.. Even on RS with a $99/month server with 400 gigs bw...you'd have to have 238 accounts on that machine to make ends. With all that, you can only give each client 1.6 gigs of bw...if any go over, you go bust.
Do the math. There's such things as "percieved value". You lose a lot of potential customers on your site visits simply because you are way too low priced. I will tell you this, no host with less than 20 posts on their forums is going to tell me differently...you dont have the experience to realize what you are getting yourself into by doing this.. $5/month hosts go under all the time, I can promise you a $5/yr host stands no chance if it remains like it is. Do yourself a favor, raise your rates to cover costs and offer good support. That's all you need to succeed in getting a good base of customers.