What is overselling?

Overselling basically means to sell beyond the means of delivery. Specifically to the web hosting business, overselling refers to the ability to sell more resources (bandwidth and disk space) than available with an assumption that the resources will be mostly underutilized. However, that's a little bit oversimplified. Maybe an example will help you get a clearer picture.

A web hosting company might have a server with a 80 GB hard drive and 700 GB bandwidth. The company starts to sell plans with 1GB space and 10GB transfer quota. After selling 70 plans the bandwidth allocated for those 70 clients reaches the limit of 700GB. However, the web hosting company notices that each month only 275-300 GB of bandwidth are "consumed" by the clients hosted on that server.

It decides then to sell more accounts - over the 700 GB limit of bandwidth. After selling another 10 plans and hosting those websites on that same server, the allocated space totals 80 GB. However, the company notices that only about 40 GB of space were used by the customers over the last 6 months. The bandwidth consumption increased as expected at about 325-350 GB per month. So it seems there would be no problem to host another 10 or even 20 customers on that server.

Since the cost for the server is constant, every added plan could be easily seen as pure profit. Anyway you look at it, they were able to get more money from that same server. The only problem would be if all their customers would all of a sudden consume all the bandwidth and the space that they were allocated. The server would not have the space (solution: add another hard drive) and the company would have to pay at a higher-than-usual rate for the bandwidth consumed over the 700 GB that were initially allocated by their provider. Either that or the other customers on that server will not be able to utilize all the resources allotted to them and the access to their websites might become slow.

Almost all overselling hosts start out the same. Clients have great uptime, servers are fast etc. As more time goes by the server becomes more and more filled from resellers using what they purchased and downtime gradually gets worse.

Please see our Web Site Hosting No Overselling Guarantee.

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