So far this year, at least 31 web hosts and domain registrars (see list) have reduced prices or increased resource allocations. Here's a quick breakdown based on a few different parameters:

(a) 11 offers were limited time; 20 were permanent adjustments;
(b) 19 had monetary impact, 12 did not;
(c) 19 were available only to new customers, 11 were available to all customers; JaguarPC was the only company whose offer benefited just current customers;
(d) Only Netazen offered non-overage-incurring current customers any financial benefit.

If I look at these stats with my end user's hat on, I would conclude that bandwidth, data storage and domain registration fees must be getting cheaper by the minute. Unfortunately, if I stay with my current provider, the best I can hope for is an unneeded increase in resource allocations. Loyalty doesn't pay if I want a deal that reflects current market conditions.

Given the going price of AdWords bids, is it such a good idea to reward switching? Instead of offering new customers a discount during the initial months of their contracts, what about a reverse promo that gives long-time customers a better price after they've maintained their accounts for some amount of time?

I heard about this from Dan Kimball at ModernBill. Bill Slawski has two interesting posts on Search Engine Land and SEO by the Sea about a just-granted Microsoft patent ("Systems and Methods for Removing Duplicate Search Engine Results").

The patented technology aims to "efficiently locate desired information.... [by] removing unnecessary multiple references to a common resource such as redundant URLs as another listed URL". Consequently, any given page of search results would contain a greater number of unique URLs than would otherwise occur without filtering. Bill says this implies the possibility of removing organic search results from pages that already contain paid listings.

Two Search Engine Land readers reported that they've already seen organic rankings drop as a result of buying keyword ads from Yahoo! and Google, respectively. While search engines are understandably eager to maximize keyword ad revenue, Bill says the ideal situation for advertisers is to have a paid result, an organic result AND a Google Onebox result all on the same page.

This reminds me of Business 2.0's "Perfect Online Ad" article, in which Usama Fayyad, the NASA rocket scientist turned Yahoo! researcher, says paid search alone is much, much less effective than multiple forms of exposure. (He was making the case for non-search ads, though, seeing as 95% of our online time is spent on non-search activities.)

In any case, I did a quick Google search for web hosting and found that there's no overlap at all between the paid ads and organic listings on the first page. Even more interestingly, GoDaddy has the #2 Adwords bid (which puts it at the top of page 1), but a #11 organic ranking (top of page 2). HostGator, on the other hand, has a lower bid that puts its ad on page 2 - but its organic ranking is #9 (bottom of page 1). Coincidence? Or filtering? What do you think?

At HostingCon's advisory board meeting last week, Ben Fisher from TechPad Agency told me why he doesn't offer SEO traning any more.

Ben's White Hat techniques have helped clients achieve prominent positions on keywords such as "web hosting", "dedicated servers" and "ecommerce hosting". On the other hand, a customer of his recently shared signup stats from visitors who Googled these terms; the conversion rate was abysmal! After all, every hosting company (and there are thousands) looks up the same few keywords all the time to scope out the competition. You do the math on how much search traffic is generated by end users.

These days, Ben's focusing on social media marketing. At the very least, reputation management should be on every company's agenda. That means monitoring and responding to conversations about you, even if they're initiated by relatively small customers. Ben also recommends establishing a presence on MySpace, Digg, StumbledUpon, MyBlogLog, Flickr, YouTube... You participate, therefore you are. And the earlier you get started, the more credibility you will have relative to late arriving competitors.

Ben mentioned Will It Blend as one example of a successful social media marketing campaign. We also joked about organizing a Second Life edition of HostingCon. Our conversation reminded me of Sramana Mitra's Web 3.0 equation. She says 4C+P+VS is where we're headed, the 4C's being content, commerce, community and context. In other words, great products/services alone aren't enough; you've also got to tell a compelling story. P and VS stand for personalization (see Aggregate Knowledge) and vertical search (see Krugle).

By the way, speaking of Digg, did you know that Dell, Salesforce.com and WordPress all use voting systems to collect and prioritize customer feedback? The Linux PC discussion thread on Dell got 82,599 votes. If 82,599 of your customers wanted something, wouldn't you like to know?

Remember: biggest community wins through platform power, which isn't available through SEO - or by increasing bandwidth/storage quotas. Web 3.0 success (which Ben says you need to start planning for now) will come from participating in communities beyond your company - and letting interested members of the public play active roles in your world.

There are so many things I like about FastServers, starting from its product packages. The lowest-cost SKU on its front page is a $198 Celeron 2.4. I can't think of many dedicated server providers who can match its ARPU.

Among the several thousand EV1 customers I came in direct contact with, folks who clamored for more support *FAR* out-numbered those who wished their hosting plans included more bandwidth. You'd never guess this is the case by looking at bandwidth allocation trends across the industry, but FastServer recognizes such preferences. The server above comes with just 1500 GB, but customers have access to 5 DEFCON service levels.

Some time ago, the CEO at a competitor of FastServers' shared his concern that customers were gravitating towards a handful of rock star data center techs and network engineers. He worried that this kind of dependence isn't scalable. Yesterday I got to spend some time with FastServers VP Sales and Marketing Aaron Phillips; he has a completely different take. When he asks customers for testimonials, many of them mention how much they enjoy working with specific employees. In addition, prospects often sign up because they like what they see on FastServers' staff profiles. (On a related note, check out Michael Cote's post on the value of leveraging non-executive employees' influence.)

FastServers also gives individual employees exposure through its blog and monthly newsletter - which Aaron publishes with *amazing* regularity. Over the past three years, the only month he missed was December 2005.

I think FastServers is awesome - especially since Aaron confirmed that another HostingCon party is in the works :) And I wish more hosting providers shared their openness and consistency in customer communications, not to mention their ability to steer clear of race-to-the-bottom commoditization.

I just started reading Juicing the Orange, a book on advertising written by the founders of Fallon. (They're an ad agency whose clients include BMW, Holiday Inn, United Airlines, etc.)

The first chapter is a case study on CitiBank, which faced many of the same challenges we're seeing in the web hosting space: too many of its competitors offered too-similar products. Outsiders were invading their turf with aggressively priced services. The "rates and fees" marketing approach it traditionally relied on wasn't producing results. Focus groups and surveys showed that customers found banks indistinguishable from one other.

CitiBank execs told Fallon that their goal was to make their company a Coca Cola or Nike-like global power brand. (I suspect that GoDaddy's ambitions are along the same lines.) Fallon's solution was to look beyond interest rates, ATM fees and branch locations and find "emotional truths". What bank customers really, really want isn't free checking; it's - happiness.

The "Live Richly" campaign that Fallon developed for CitiBank led to a 30% increase in credit card signup rate. Home equity loan applications were up 14%. Inquiries for its free financial planning service rose by 67%, leading to a 184% increase in product sales. You've probably seen the ads: "he who dies with the most toys is still dead", "your truly valuable hours won't be found on a time sheet". These messages apparently resonated with customers the way "0% APR" didn't.

So, if you could afford Fallon, what kind of emotional truths might they find among web hosting customers? Earlier I had lunch with SMBLive CEO Matt Howard. He's got some pretty good answers figured out. You'll be hearing about them in the coming weeks :)

Jeff Barr.

Jeff is an evangelist for Amazon Web Services. During a 4-day trip to Utah, he found 19 separate opportunities to evangelize. Evangelism is similar-ish to PR, marketing, business development and sales - only farther-reaching and more powerful than any of the above. As an example, Jeff had a discussion with BYU professor Phil Windley about using EC2 in BYU's curriculum; this would make Amazon a key part of many, many future users' computer science education. (Amazon already has an educational partnership with the University of California, Santa Barbara.) Jeff also made a presentation to Phil's CS students (along with 5 other audiences) and recorded two podcasts.

Did anyone at your company achieve Jeff's level of outreach last week? The new ad you made might be on display at every seemingly synergistic venue you can find, but how many viewers has it built a lasting connection with? And the press release you sent out might have appeared in inboxes at thousands of media outlets, but how many reporters did it make an impression on?

I think S3 and EC2 are totally awesome, but I would argue that these technologies are less important than the way their value propositions are communicated. I know of several hosting providers who are working hard on developing Amazon-like pay-per-use offerings. Unfortunately, if coupled with traditional marketing, I'm afraid they will be disappointed with an un-Amazon-like lack of buzz.

A week or so ago, ServerBeach's Robert Miggins mentioned that a SB blog is in the works. I'd heard of that before, from at least 5 other dedicated server providers. But unlike its slacker competitors, ServerBeach got its blog up and running a day and a half later.

After reading its first few posts, I've already become much more of a ServerBeach fan. (I'm not alone in preferring vendors who blog. SmugMug CEO Don MacAskill says Jonathan Schwartz' blog is a key selling point in his choice of Sun hardware.) ServerBeach's blog posts talk about how two employees turned 145 defunct motherboards into a cool 25 foot sign, a new peering relationship with GameRail, the sad demise of web developer Ramon Vawda's computer... By sharing bits and pieces of ServerBeach life, the blog portrays the company as a happening place - which readers are invited to be a part of.

In contrast, consider the inconsistent image that The Planet's website projects: while the press releases section touts its "top 10" designation by HostReview and Netcraft, its customer forum tells a different story. "Support used to rock". "Unhappy about level of service". "The most disgraceful support I've ever dealt with in my life". If I were CEO Doug Erwin, I would start a blog *today* to openly address this contradiction. I would tell customers how I personally feel about the company's progress and share my roadmap for next steps. I truly believe no PR campaign can produce better marketing ROI than being transparent.

SoftLayer, too, should totally blog. I know that CEO Lance Crosby's writing will win instant fans. Besides, the company has so many exciting initiatives going on: low voltage servers at its new high density data center, a private Meet Me Room where customers can interconnect, 10 GigE upgrades with InterNAP and Verio... It's such a waste for all this news to be trapped in press release form, with no RSS feed that customers can subscribe to, and no place for readers to leave comments.

And last for now but not least, I think a blog would complete the websites of fellow Texans Rackspace and LayeredTech, considering both are home to long lists of prominent Web 2.0 companies. LayeredTech, in particular, hosts WordPress. That alone is reason enough for Team LT to take a sec and sign up here. ServerBeach did...

PS - FastServers isn't in Texas, but they do have a blog. I also like their staff profiles.

1. Jan from HosTest sent me some very interesting data from his latest research. During November 2006, Jan submitted a variety of tech support requests to 50 hosting providers. He rated responses on a 5-point scale based on accuracy and completeness. MochaHost, Intermedia.NET and NetRegistry got perfect scores. Jan was particularly pleased with MochaHost's 24-minute response time.

In contrast, the wait time at Verio was 62 hours and 59 minutes. This is particularly disappointing considering the "select the right hosting provider" report that Verio recently commissioned from Tier 1 Research. It advised customers to monitor their hosting providers closely. "The company's response to issues early in the relationship will be an indicator of things to come".

2. Declan McCullagh from CNet surveyed 12 domain registrars on their policies for handling abuse complaints. DirectNIC and French registrar Gandi.net, he said, offer the most extensive guarantees against unnecessary domain name suspension. DirectNIC requires a court order unless a clear case of child porn or phishing is involved, and Gandi.net takes extensive steps to contact domain owners.

I was surprised to read that Demand Media subsidiary eNom chose not to respond to Declan's survey. CEO Richard Rosenblatt told Business 2.0 some months ago that he's planning to bring a sprinkling of Web 2.0 stardust into the domains market. One would hope there's some transparency in the mix?

3. Barry Abrahamson from WordPress writes that he's in the market for 37 servers. It looks like ServerBeach will get the business because of their "super-simple and painless sales process", their "everything we asked for at a very fair price" proposal and the fact that Peer 1 VP Marketing Rajan Sodhi blogs on WordPress. Rajan was also first to respond to Barry's blog post. Very cool!

SoftLayer, on the other hand, misses out on a possible opportunity. James Byers from WikiSpaces comments that SoftLayer is fantastic, but no follow up from SL so far. Considering that 4 out of the company's last 5 press releases mentions Web 2.0, maybe SL should start a WordPress blog?

PS - BTW, Matt Mullenweg pointed out earlier this week that you can blog on WordPress using MS Word 2007. You might want to pass along these instructions and these screen shots to your customers.

Holy cow; these are some impressive numbers. Matt Marshall from Venture Beat reports that Aggregate Knowledge (AK) drove more than 20% of Overstock.com's holiday sales. Matt estimates that AK might be responsible for $100M of Overstock's $700-800M annual revenue. That's 12.5% worth of sales on the low end. (Matt previously mentioned that Amazon generates 35% of its sales through auto-recommendations.)

Aggregate Knowledge is an ad platform, sort of. Just as Google displays your PPC ads to people who search for "web hosting" (or whatever keywords you've bid for), AK shows visitors who are already on your website that your hosting plans support blogs, CGI scripts, MySQL databases or whatever they're looking for, as determined by their navigation behavior. Speaking of which, Collarity takes behavior targeting even farther by grouping visitors into affinity communities (new webmasters, developers, designers, for instance) based on their clickstreams.

If behavior targeting helps increase Amazon's and Overstock.com's sales, could it work for 1&1 as well? I remember having a conversation with CEO Andreas Gauger about diminishing returns on advertising: even an infinitely large marketing budget won't generate an infinite number of new sign-ups, because there simply isn't enough high quality ad inventory out there. Wouldn't he like to squeeze 12.5%, 20% or even 35% more orders out of current website visitors without increasing incoming traffic? Wouldn't you?

The problem is, most hosting providers' websites (including 1&1's, which I'll use as an example) aren't very conducive to behavior targeting. Visitors are usually presented with one or more service plans, which include loooong list of features. Reverse navigation generally isn't possible. For example, I can't start at the "MySQL" page and find out what my options are (1&1 Business includes 50 databases, and 1&1 Developer includes 100, etc). As a result, 1&1 loses the opportunity to find out what kind of hosting customer I am - *and* the ability to close the deal by letting me know that 87% of "people like me" chose its $9.99/month package.

In other words, it seems web hosting services are typically marketed with the assumption that customers differ only in their bandwidth/storage/monthly fee preferences. But based on my experience, website owners are a diverse crowd. Some are sophisticated developers, others don't even know HTML. Some hope their websites will attract as much traffic as possible, others use their hosting accounts to store private documents.

Just think: if Amazon offered only a list of products with no behavior targeting, it'd collect 35% less revenue from the same website visitors. How much business could you be missing out on by not identifying and reaching out to your different audiences?

Matt Mullenweg from WordPress caused quite a stir last week when he vented on his blog about his frustrating experience with Sun's Startup Essentials Program. He wrapped up the post by saying he's "far more excited about what Amazon is doing these days."

Within 23 minutes, Amazon evangelist Jeff Barr - who was recovering from surgery - commented on Matt's blog that he would love to talk. And about a day later, Sun CEO Jonathan Schwartz posted an apology on his blog:

"All I can say is... I'm really sorry, Matt. That's not the way Startup Essentials is supposed to work. We screwed up, and you're completely right to suggest if that's the norm, we should kiss goodbye our aspirations of reestablishing our business in the startup community. If there's anything I can do to win a second chance, I'd like to know."

I totally agree with Red Monk analyst James Governor's assessment of the situation: "the sales battle for contracts, from major to minor, is increasingly being fought out in the blogosphere. If you don't play then you may miss out on a pay day... Go read Matt's blog again. As an RFP." (RFP = request for proposal.)

Now that Amazon and Sun have responded to Matt's RFP, another company that I wish Matt had heard from is LayeredTech. Back in November, Matt mentioned that WordPress has 50+ servers at Layered. Considering (a) the existing relationship, (b) Matt's interest in Amazon's S3 and EC2 services, and (c) Layered's new on-demand, pay-as-you-grow computing service, I'm disappointed that Todd from Layered hasn't joined in the conversation. Especially since both Matt and Stephen O'Grady, James' Red Monk colleague, are both getting interested in Media Temple's GRID platform

Speaking of which, Media Temple's recent blog post really helped spread the world. Along with Matt and Stephen and dozens of others, Scott Yang over at HostingFu is talking about it too. Unfortunately, Media Temple hasn't followed up on these threads either - at least not publicly.

I know that every web hosting CEO is overwhelmingly busy - but I'm sure Jonathan Schwartz' to do list isn't any shorter than yours?? PLEASE... do a Google Blogsearch for your company - then subscribe to the RSS feed for new search results, and keep on top of these discussions. Publicly.

The last company I'm going to pick on in this post is ServerBeach. Kevin Burton wrote last November that "while I like Serverbeach they need to get their act together fast or I might just switch to EC2." I've forwarded this post to at least 3 different people at Peer 1, but the only public response Kevin's gotten has been from... Jeff Barr over at Amazon.