How I Lost Thousands Of Dollars Overnight By Not Diversifying My Webhosting Servers

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Several weeks just before Thanksgiving is when the linen napkin side of our business picks up dramatically. Since wedding season starts to taper off towards the beginning of November, my wife and I depend on napkin sales to pick up the slack for declining wedding related sales during the winter time.

Photo By Images_of_Money

Because our linens business is very cyclical, we usually stock up on napkin products well in advance prior to the holiday season.

So like every year, my wife and I were ready for sales to spike as usual when the unthinkable happened. The server at my webhost crashed and all of my main money making websites became unavailable for an extended period.

Poor Customer Service

When my sites first went down, I immediately contacted my host and they reassured me that this was something very minor.

They told me that a hard drive had gone bad in their RAID setup and that the techs were working on it right away.

Since I’m a geek, something about their explanation didn’t really make sense to me. Hard drives in a RAID array are supposed to be redundant which means if a single drive goes down, nothing bad should happen.

Even still, the techs told me that the down time would only be on the order of 15 minutes so I was cool with that. After all, there was nothing I could do at the time anyways. I was stuck in a meeting at my company and 15 minutes didn’t seem too bad.

But 15 minutes turned into an hour which then ballooned into 3 hours. I was frantically trying to get a hold of someone who knew what was going on but I couldn’t get any information from anyone. Meanwhile, since all of my money sites were down simultaneously I was losing more and more money as time went by.

It was only after 8 hours had gone that my webhost finally told me that the entire server was faulty and that they were migrating my account to a different machine. 8 fricken hours just to find out what was going on!

So I waited and waited…. And my websites finally came back up over 2 hours later!!! But after surfing around for a little bit, I discovered that they were dog slow. In fact, they were so slow that no one in hell would be able to checkout of our online store. No one would be able read my blog either or purchase my online store course. This was unacceptable!!!

Long story short, I lost over a day of server time which cost me thousands of dollars!

The Real Reason I Lost So Much Money

What’s ironic about all of this is that I had just had a conversation with David Ning from about server uptime and diversification.

David: Dude if I were you, I would overspend on hosting.

Me: Huh? What do you mean? My hosting has been ok for a few years now.

David: Just saying that if I were you, I would host each of your money making websites on separate webhosts for redundancy. Because even a single day of downtime could cost you a lot of money.

Me: Yeah…But that would be really expensive. Everything has been fine so far. It’s all good.

There’s something to be said about David’s philosophy. If you have a lot of sites that make money, you should place them on different servers in different geographical locations if possible to minimize the chances of everything going down at once.

Of course doing things this way costs more money which goes against my Asian tendencies(incidentally, David is Asian too so this is not an excuse). Essentially, you have to pay for separate hosting accounts for each of your money making sites which can get rather expensive, but this is exactly what David does with all of his web properties.

The problem is that I’m a pretty cheap guy. And to be honest, the existing server that I was using to host my websites was a little underpowered and I’d been meaning to switch webhosts for quite a while now.

But you know what was stopping me? I had prepaid for an entire year of hosting at my current host and I still had 300 bucks left in my account.

Since I didn’t want to lose that money, I decided to stick with them for another 3 months even though my sites got really slow from time to time.

Remember Star Wars when Han Solo kept telling the Millennium Falcon to “Hold together baby”? That’s kind of how I felt with my current server but kept telling myself that I only had to endure this for another 3 months.

Big time mistake! The amount of money that I lost probably cost me multiple years worth of hosting because all of my money making sites went down at once!

The Resolution

During the downtime, I got completely fed up with my current host and signed up for Storm On Demand. For all of you who aren’t familiar with Storm, it is actually a very unique hosting service where you pay for everything based on your usage.

And the best part is that you can easily scale your server at the click of a button and migrate your sites to faster hosting or a completely different server extremely quickly (on the order of an hour or so depending on your site).

In fact, you can create a brand new server in a just a few minutes, cancel your account a few hours later and only have to pay for those 2 hours. This feature can come in extremely handy if you just want to setup a temporary staging site for your shop or if you want to test some upgrades without going live.

In any case, right now I have my online store running on my old host and my blog running over at Storm On Demand. While I’m currently paying double the hosting charges for redundancy during the holiday season, I plan on migrating the rest of my websites over to Storm in the next month or so once things settle down.

The Eventual Plan

But wait…won’t I still have the same redundancy problem by moving all of my sites over to Storm? The answer is no and here’s why…

  • Storm allows you to create a server at one of 3 different geographical locations. Having 2 or 3 virtual servers set up will only cost me marginally more money
  • Because you can migrate an existing server setup to a completely different server at the push of a button, in theory there’s never a case where you should be down for more than a few hours even in the event of catastrophic hardware failure. Unlike other webhosts where you are at the mercy of the techs to do everything, Storm allows you to restore server images yourself from a convenient backup.

The other advantage of Storm over most VPS solutions out there is that they guarantee you a certain amount of CPUs. Unlike my last VPS host who couldn’t give me a straight answer, I’ve found the Storm servers to be quite zippy in comparison with less likelihood of someone else on your same box slowing down your site.


So what do you think? Am I being too paranoid by hosting my money making sites on separate machines? When you take into account the fact that each site is capable of generating 4 figures a day, you really have to factor in the cost of downtime.

To have all of my sites go down at the same time for an entire day was extremely painful. So painful, that I hope to never have that happen again.

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16 thoughts on “How I Lost Thousands Of Dollars Overnight By Not Diversifying My Webhosting Servers”

  1. I don’t think you’re paranoid at all and will definitely check storm out. When I read that RAID part, I was a bit suspicious too even though I’ve been out of IT for years and have forgotten A LOT. RAID stands for REDUNDANT array of independent disks so…yeah. You were right to make that move.

    1. I’ve been with this webhost for quite a while. If they were just honest and up front to begin with, I probably would have stayed with them. But they kept me in the dark for a long time which really annoyed me. The RAID comment really ticked me off.

  2. Cassie says:

    Agreed if you have various revenue options use a different host server for each, don’t stop there back up on-line access there are grateful more than one web access. Then have a back up computer for if one goes down. The same goes with banking I separate income accounts per each revenue option so if a credit card fraud investigation occurs you have access to money.

    scary as this sound had a bank branch had a security breach they shut down some accounts for investigation for several weeks it was over-reaction a credit card charge off using return for a dissatisfied delivery – the customer used their credit card insurance then calling about shipping damage on a product I had insured.

    Always have a back up now I don’t depend on one bank, one server, solely one thing ever has an emergency back -up it comes thru when one day your hit with the unthinkable a natural disaster such as hurricane or etc. I remember when UPS went on strike so yes you need multiple shipping accounts. So yes it may sounds crazy but preparing for the worst helps when something out of the blue strikes you have something at your fingertips…..

    1. Hey Cassie,

      I was going to talk next about Google accounts as well:) But yes you are right. Anything mission critical should have diversification and redundancy.

  3. If you have that much money coming in a day then you owe it to yourself to spend the money to make sure that you minimize the risk of losing that revenue stream. It ties back to the philosophy of spending money to make money. If you don’t spend the money on solid hosting, you run the risk of not making money. Seems pretty simple to me, but likely was an expensive lesson learned.

    1. It’s not that I’m using cheap hosting or anything like that. After all, I was already paying 100 a month. What hurt the most was everything going down at once. This was the first time it happened and I didn’t like the way they dealt with it. But as David Ning says, you should overspend on hosting.

  4. Sounds like a smart move considering the amount of money you make daily. So sorry to hear this happened, but glad you have recovered. You never mention the hosting company’s name, should we be concerned with our hosting being that we are small?

  5. Actually, I think you have a problem with Storm. It is a single point of failure. Consider:

    1. What if they have a security issue (like GoDaddy) where your server is compromised or they have to shut it down?
    2. Is it built on Amazon S3? Amazon goes down surprisingly often. Sites on Heroku (which is a distributed hosting solution built on S3) were down for 8 hours recently.
    3. What if they go bankrupt and shut down without notice?
    4. They may have complex proprietary systems to manage their servers. These systems may be new, not be well tested, or reliable.

    I think it is possible for the same sort of problem, just with newer technology and higher prices. If you want to be more certain that it doesn’t happen again, I think you need redundancy outside of Storm.

  6. Steve,

    I think you just partially solved your risk diversification problem but not completely solved it. What you did is that you move all of your eggs from one basket into another basket with each of your egg in different partitions of that basket. However, all of your eggs are still in the same basket. In the events of the whole company got hacked, I think you will face the same problem. Maybe you just lessen the risk factor from 10 down to 5, but not to a much lower level like 1 or 2.



    1. George and Vinh,

      Yes, what you are saying is definitely true. What has swayed me is that I’ve been really impressed with Storm’s customer support. Everyone who I have talked to so far has been technically competent. What I especially like about them is the fact that I have dedicated CPUs without having to get a dedicated box that is easily expandable. I haven’t made my final decision yet so if I can find an equivalent reputable host with a similar structure, I may diversify further.

  7. Bummer on that experience, I’ve been there.

    I have considered the redundancy solutions but it just doesn’t make sense for my business right now, which isn’t high frequency purchase site, and for issues I do have a weekly backup that could have a site live in as much time as it would take the DNS to change from one host to another host is okay, although still hands on needed.

    What would be nice is a DNS failover, when one site has a poor response time, the DNS or A records would failover to another host that has clones being made!

    A good reminder to have a backup in place when your website earns you income!

  8. I’m with Storm on Demand as well, and have been impressed with their high level of support, and like you say, how all of the support staff seem to be much more competent than at my previous host. I also like how you can scale your server if need be, and/or even move to a new server very fast.

    When I switched hosts Storm did the entire process for me, for no cost whatsoever. They were extremely helpful, and since my switch my sites have been so much more stable – and support so much better.

    1. I haven’t been with them long enough just yet but I’m very impressed so far. Because I’m anal, I moved over my sites myself one by one.

  9. Anna Ali says:

    I did a lot of search and found that hostgator is the best hosting site .I also want to start my online store very soon can anyone tell me do we need to signup for any other hosting if we decide to use magento go .what steps should I take if i want to run my site through magento go .any help?

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