I read about this on Bert Amijo's blog. 3Tera CEO Vlad Miloushev did the math:

1. Google's infrastructure consists of 500,000 to 1 million servers.

2. Google's Q4, 2006 revenue was $3.2 billion. On an annualized basis, that's $12.8 billion.

If you divide #2 by #1, you'd get $12,800 to $25,600 of revenue per server. If you take the average and divide the amount by 12, you'd end up with $1,422/month in sales for each server. Google spends about 10% of its revenue on operations, which equals $142 per server.

As a point of reference, let's consider HostGator's announcement that it will expand its presence at The Planet. HostGator currently leases 1,700 servers, which are home to 500,000 websites. That's 294 sites per server. If HostGator collected as little as $4.84 from each site owner, it'd generate more revenue per server than Google!

HostGator's cheapest service plan costs $6.95/month, but it allows customers paying $9.95 or more to host multiple sites. Which most - including HostGator's 10,000 resellers - do. So Brent doesn't have Larry and Sergey beat. Yet. But while I was doing the calculations above, I remembered a conversation with Lenkov from SiteKreator. Thanks to some kind of caching magic (which ISP-Planet discusses in this article), Lenkov's software can support up to 30,000 simple websites on a two CPU machine.

Let's say Brent springs for a quad core Clovertown from The Planet, hosts only 15,000 websites, and charges each site owner $1/month. This would put him ahead of Google in terms of both revenue/hosting expense ratio, and sales per server.

ISP-Planet says SiteKreator can be licensed for an "unpublished fee". I'll have to ask Lenkov about that...

Dave Young from Joyent recently blogged about Twitter's use of Joyent Accelerators. Accelerators are Solaris Containers on Sun Fire X4100s with Sun Fire X4500s (also known as "Thumpers") for storage. Joyent promises on-demand, no-leash computing and offers virtual servers for as little as $45/month (includes 256 MB RAM, 5 GB storage, 15 GB bandwidth). It sounds pretty cool - and check out the video of Dave and Jason on Sun's website!

The problem is, after reading Dave's post, I think of him every time Twitter is down. Which, as many of his readers pointed out, happens often. Dave says us complainers are missing the point. Twitter is growing like crazy! It serves 4,000+ requests per second! That's a lot - and Joyent helped get them there! Unfortunately (or fortunately?), Twitter users' demand seems to exceed its already-substantial capacity.

If I were Dave, I'd move Twitter to as many XXL Accelerator Sparcs as it takes. Having come a long way just doesn't make good enough PR fodder when you've got John Edwards live blogging from the campaign trail ("About to make remarks at the Int'l Assoc. of Firefighters. Then remarks at the Boilermakers conference.").

A few months ago, I was telling Steve Kahan over at The Planet that he ought to turn a couple of his sales reps into venture capitalists, of sorts. These folks would scan the customer database for major brand names as well as up and coming influencers. They'd proactively monitor these VIPs' infrastructure and offer free scalability advice and migration assistance. They'd set up an invitation-only beta program and strong arm Dell into providing test units of its latest gear. They'd research these customers' industries and make introductions if they come across people in similar markets...

More recently, RedMonk analyst James Governor suggested something much more radical. Forget that beta program; how about long-term loans for future movers and shakers? And instead of my idea of creating case studies out of The Planet's great working relationships with today's news-makers, take a great leap forward to the open source hardware business model. Put your tools in the hands of tomorrow's innovators. You need to do this quickly, because you're competing with Jeff Barr. In Joyent's case, I have no doubt that last part is true...

PS - It just occurred to me that SoftLayer, in particular, might have much to gain from being a patron to soon-to-be influencers. Softlayer announced a private meet me room a few weeks ago, where developers of different SoftLayer-hosted applications can interconnect without incurring bandwidth charges. So if someone's created a community that many others are eager to extend and/or leverage, wouldn't it be worthwhile for SoftLayer to make itself that community's home base?

PPS - Hosted Solutions, too! It's cool that they're spearheading the Carolina SaaS User Group, but I think what would really enhance their appeal is if they hosted the most-mash-upped apps.

A very, very long time ago, Dmitri Eroshenko (now CEO of ClickLab) and I added something called the "Guaranteed Web Host Program" to ISPcheck, our web hosting directory. Around the same time, our arch-competitor Jonathan Caputo (now of DevShed) used his Ultimate Web Host List as a launchpad for Web Host Guild. And the folks at TopHosts started VeriHost.

All three projects were intended to help participating web hosts distinguish themselves from competitors by setting industry standards they'd agree to comply with. All three fizzled, because none of us were able to come up with differentiators that made good enough public-relations fodder. You need something that's easy to adopt from web hosts' perspective - and yet creates black and white, us versus them drama in the eyes of consumers. "24/7 support" and "superior connectivity" are important and all, but when it comes to marketing, these are tired cliches rather than attention grabbers.

8 or 9 years later, thanks to Michael Dell, I think I've finally found the right kind of differentiator. Dell was featured in eWeek, CNet, the New York Times (twice!) and Business 2.0 yesterday for his "Plant a Tree For Me" campaign, which allows customers to donate $2 for each laptop and $6 for each desktop they purchase from Dell. Proceeds will be given to the Conservation Fund and the Carbonfund for planting trees that offset each computer's carbon emission over its estimated 3-year lifespan.

Dell points out that his company will also help customers recycle 275 million pounds of old computers by 2009. Greenpeace, he says, put Dell at the top of its ranking of eco-responsible manufacturers.

By the way, a few weeks ago, California utility PG&E introduced an optional program for interested customers to calculate and offset the amount of carbon dioxide their power supply produces. And in a November 2006 interview, eBay infrastructure manager Heather Peck told SearchDataCenter.com that she expects consumers to start demanding environmental responsibility from eBay and other major data center operators.

So anyway, here's a way for ecommerce hosting providers to look good, perhaps. A few of our industry leaders could get together and implement a voluntary carbon offset program similar to PG&E's and Dell's. Much more importantly, they could jointly maintain an online directory of participating customers. At a time when even my most Republican friends are talking about Al Gore's Inconvenient Truth, I'd imagine that a good number of online retailers would be interested in projecting an environmentally conscious image?

Early adopters, I think, would be able to enjoy the black and white, us versus them PR advantage that pre-historic web hosting players failed to create in ancient times. Especially if the weather keeps getting warmer (picture spotted on Paul Kedrosky's blog).

I read about Sun's newly launched refresh service on CNet. For a monthly subscription fee throughout a 42-month term, Sun will give you at least 3 upgrades to the latest hardware.

On its website, Sun argues that server performance and power efficiency improve at a rate of 40%+ annually. Old machines incur needless expenses in power, cooling and data center space. Instead, why not fight server sprawl and take full advantage of the innovation curve - automatically?

According to the refresh service brochure, the $23,000/month subscription fee is half the price of a traditional hardware lease - if (and this is a *BIG* if) you upgrade your gear three times over 3.5 years. This is such a clever approach. It gives Sun a guaranteed install base for hardware that hasn't even been developed!

So, let's think about whether this concept could work in web hosting. Do you think there's a market for an "early adopters" program where customers pay a month subscription fee for immediate access to the latest and great machine you get from Dell?

Just saw the news on CNet , GigaOm and GigaGamez. The International Association of Virtual Reality Technologies has announced that it will form a new public network that's "capable of meeting the data transmission requirements of emerging cinematic and immersive virtual reality technologies." Neuronet, as it will be called, will be "separate and distinct from the Internet, and used for everything from gaming to entertainment to virtual business."

What will Neuronet's infrastructure look like? Well, "the massive overcapacity of fiber optic cable left over from the dot-com era makes the new network feasible with minimal investment." Also, "much of the infrastructure and programming utilized to facilitate the Neuronet will be outsourced to telecommunications and virtual reality innovators." Neuronet is already talking about a domain naming system, forming committees on standards, regulatory affairs, etc, and selling memberships.

I'm a little skeptical, because never once does the IAVRT identify any company or individual who's already involved with the non-profit association. If its members include "market leaders in telecommunications, entertainment, gaming, business, several Fortune 500 companies and leading research institutions around the globe", why aren't they lending credibility by being officially represented on the site - or publicly announcing their participation?

Speaking of the site, the IAVRT.org domain (under private registration at GoDaddy) traceroutes to VerveHosting of Pontiac, Michigan. It seems Verve resells for or colos at Net@ccess, whose data center is in New Jersey. The IAVRT itself appears to be located in Vancouver, Canada. If it were a big enough operation to bring together a whole new separate public network, I'd expected its website to be hosted with a more prominent provider, or one that's closer to its home base?

Anyway, if my skepticism is unfounded, the game server teams at Peer 1, LayeredTech and The Planet ought to look into this. If there's going to be a separate network for gaming traffic, you won't be able to stay in the game hosting business without getting involved.

P.S. On a not entirely related note, speaking of virtual business, of which there is already plenty in Second Life, maybe VeriSign and Comodo should start offering virtual SSL certs? Shouldn't virtual shoppers have the ability to verify the legitimacy of their virtual vendors? You wouldn't want to lose Lindens to an unscrupulous avatar - or get your virtual identity stolen by a virtual phisher?

A few months ago, in response to Trinity Ventures' $10.5 million investment in Photobucket, Tier 1 Research wrote that "the growth in functional hosting represents a growing threat to shared hosting providers."

Photobucket has grown rapidly since then. It had 15 million users back in May but recently passed the 30 million mark. Other functional hosting services - such as YouTube, MySpace, LinkedIn - have also enjoyed unheard of momentum (and valuations!) in traditional web hosting. In contrast, GoDaddy is just now entering the photo hosting market. I'm sorry to say that I don't think its Online Photo Filer will *ever* reach 30 million users. It offers too little, too late.

Instead of chasing after functional hosting coattails, maybe Bob Parsons should position himself as the king of "situational hosting"? As his ads put it, life is full of dotcom moments. For instance:

JohnAndMaryAreGettingHitched.com
As a newly engaged couple, there's nothing you need more than a web hosting account! Set up a forum where your bridesmaids can gripe about your dress selection! Install Pligg and let your friends vote on who deserves to be invited to the wedding!

BabyJane26Dec2006.com
Yay! She's finally here! Now sign her up for a domain name, put a "donate to college fund" button next to the cute pics, and email the URL to all of your relatives!

RIPSteveSmith.com
Great grandpa's lived a good life; now doesn't he deserve an online memorial? Create a central repository where everyone within the extended family can upload old letters and photos. It's part of your personal history, don't let it disappear!

You get the idea: it's up to web hosts to make web hosting a relevant part of every milestone (KimIsAKindergartenGrad.com), every product purchase (FredHasAFastNewCar.com), every trip people take (AndysAwesomeAustralianAdventure.com)... Because there's an endless array of dotcom moments that can be leveraged to reach highly targeted audiences of super eager buyers. The trick is to focus on *customers* as stars in their dotcom-worthy experiences - not French Maids, not Candice Michelle and not Danica Patrick.

I was re-reading Liam's and David's latest posts, and the answer became obvious. These guys have come up with a great new way to market web hosting to the technically unsavvy!

Liam is interested in "a place for intangible Internet services in the physical world". And David thinks there might be a market for domain name title insurance. This means...

Ok, let me back up for a sec. In 2000, CNN ran an article about the lunar land grab. 300,000 people had purchased space on the moon. And during 2003, according to Space.com, more than 2.5 million people bought property on the moon and Mars. Even now, you can get your own acre of lunar real estate for $18.95. You'll even get an engraved parchment deed; shipping is $7 extra.

So, what if you took the $18.95 package and replaced "lunar real estate" with "domain name"? Add $5 for title insurance. Add $20 for a theirdomain.com t-shirt. Plus $5 for a gift box and $7 for shipping. I'm guessing land in space is purchased mostly as a last minute present; so it could be with the now-tangible $55.95 domain name gift pack.

When the lucky recipient goes to his newly registered domain name, he should see a "welcome home" message: this land is your land, except it's empty. Would you like to set up a shop to sell off all that junk in your garage? Or maybe you'd rather build a virtual home by uploading some photos? Or a digital safe deposit box for your important documents? Or perhaps even a fan club, where people can download videos and songs from your band? Basic apps would be free, along with a small amount of bandwidth and storage space. Advanced application features and additional hosting resources would be available for various fees. Of course, domain owners could also turn their properties into virtual parking lots on which their hosting providers could run Google ads.

Ok, when I started this post, I thought of the virtual real estate analogy as sort of a hoax, more frivolous gift than serious business service. But the more I think about it, the concept could have actual legitimacy. A few months ago, 1&1 CEO Andreas Gauger mentioned that he thinks *everyone* should have a website. There are so many possibilities. Like... some of the uses I mentioned above. Only these may not occur to the average man on the street. He logs into his hosting account, sees a blank canvas and is at a loss. But if you offered some suggestions and a few templates, Liam might change his mind next year and decide that web hosting could be a useful gift.

A couple of weeks ago, BusinessWeek ran an article about RyanAir. I was surprised to read that about 10% of the company's $3 billion+ annual sales comes from commissions on rental cars, hotel rooms, ski packages, travel insurance, etc. that it advertises on its website. $332 million between March 2005 and March 2006! A 36% increase over the previous year! Can you believe it?

In contrast, when you sign up for any service at 1&1 or GoDaddy, the only marketing messages you'll see are for the company's other products. Why is that?

For instance, might it make sense to offer domain registration customers theirname.com t-shirts? If someone activated your photo album tool, maybe they'd be interested in photo printing? And if they lived in Chicago, you could show them flight deals from Midway and O'Hare? At the very least, you could build an Amazon aStore; the folks at TypePad did. I've met more than a few new dedicated server owners who'd benefit from a good sysadmin reference book.

Just think: RyanAir is an airline, yet it manages to generate ~$1.80 from each website visitor - whether or not they become customers. Since 1&1 and GoDaddy are in the business of enabling Internet success, shouldn't they be able to match RyanAir's performance? And if you, too, are in the hosting business, shouldn't you?

PS - I just remembered that GoDaddy recently signed Danica Patrick as their new spokesperson. Maybe they'll leverage the deal to sell some miniature GoDaddy race cars?

From Jon Udell's InfoWorld article:

Imagine a future version of Amazon.com where the price for each product is reported in two different ways: as dollars (P1), and also as carbon-adjusted dollars (P2). Now consider a pair of competing products, A and B, under two different scenarios.

In one scenario, A's P2 is lower than B's, but its P1 is higher. Some people will be willing to pay more dollars to reward A's lower environmental impact, but most won't. In the other scenario, A's P2 is still lower than B's, but its P1 is about the same. There's no cost for rewarding A's lower environmental impact. If the P2 data is available, it's a rational choice.

I forwarded it to my friends Patrick and Sophy. We recently went to the DC Green Festival, which had outrageously long ticket lines. If stores offered carbon adjusted price tags, I really think it might have an impact on many of our fellow attendees' buying decisions.

So imagine a future hosting company where the price for each server is reported in two different ways: as dollars, and also as carbon-adjusted dollars. Would it make a difference in customers' equipment selection? Rackspace UK might have some idea. It recently started offering carbon neutral web hosting. The company plants trees to offset carbon emissions from participating customers' gear.

A couple of months ago, Rackspace said it added 105 new employee during Q2, 2006 - and planned to hire 200 more before year end. More recently, BlueHost CEO Matt Heaton wrote on his blog that his team grew by 30 during the past 4 months - and he's looking to add 30 more people in the next 4 months. But is there more where the new hires came from?

"We have plenty of jobs!" ThePlanet-EV1Servers' Doug Erwin said during a recent live chat session with his customers. "Send your resume to us: jobs@theplanet.com". Of course, if there were any web hosting resellers in the audience, I'll bet they're looking to expand their staff as well.

Recruitment is one challenge, retention is another. The Economist says America's 500 largest companies will lose half of their senior managers in the next 5 years. AFCOM's Data Center Institute says the talent pool of corporate data center professionals will shrink by 45% between now and 2015. Most web hosting companies are fortunate to have relatively young employees. On the other hand, while your people aren't getting ready for retirement, they can look forward to being ruthlessly headhunted.

Already, this IT Pro survey shows that 48% of the 1000 IT workers it interviewed are sending out resumes or talking to recruiters. According to Wired Magazine, even Microsoft isn't immune. The company has tripled employee stock options and rolled out concierge services such as grocery delivery. When a 20-something engineer got a job offer from Google, Microsoft reportedly offered him $250,000 to stay. He said no thanks.

Offshoring is getting tougher as well. In its December issue, FastCompany reports that Indian companies are competing for talent by offering a wide array of benefits - for prospective workers' extended family! Some perks the article cited include no-interest loans for parents and siblings, free movie tickets and health club/swimming pool memberships.

In an era when SalesForce.com is gaining ground against on-premise enterprise apps (software-as-a-service), and utility computing is an emerging alternative to server hugging (some call it hardware-as-a-service), might it also be time for, um, people-as-a-service?

That's the vision behind oDesk, a company that offers pre-certified developers and DB admins and such on demand, and lets you monitor contractors via webcams, regular screen captures, and real time stats on keyboard/mouse activity. That's waaaay more accountability than you get from full time employees in the next cubicle.

In this TechCrunch discussion, some call the Big Brother-esque monitoring "slavery 2.0", others say the total accountability builds trust. Your thoughts?

BTW, oDesk has billed 500,000 hours so far. That amounts to 250 years of full time work. Check out these nifty O'Reilly visualizations, which show what technologies companies are hiring contractors for.