One of my clients is working on moving their web application and several server applications to a single hosting provider. I’ve been asked to help with this transition (since I’m the “technical guy”) and as part of that process I’m evaluating proposals from various web hosting providers around the country.

What’s breathtaking to me is how much some of these companies charge for simple things. For example, in the proposal I’m reading right now, they’re charging $60 per month for an additional 512MB of memory in the server. There are two things amazing about this: first, you can’t even buy memory in 512MB pieces any more– the smallest server-class RAM comes in 1GB; second, that 1GB memory chip costs about $20. Once. To charge $60 every month for something that cost the equivalent of $10 and then had to be plugged into the server motherboard is astounding.

Then there’s disk space. You can find a nice 1TB hard drive just about anywhere for around $100. A server-class drive– which tends to have higher spin rates and lower failure specs– might cost $200. And this proposal lists a 750GB drive (which is only three-fourths of that 1TB drive) at $320 per month. Per month! In other words, over the course of a year for that money you could walk down to your local Best Buy and pick up 38 1TB drives– roughly fifty times the storage. And by the end of the year that $100 price tag is going to drop to $75 anyway. Technology gets cheaper by the day.

How do these guys sleep at night, charging these outrageous fees?

Actually, maybe I should look at it a little differently. I own a hosting company, after all… maybe I should be charging exorbitant rates for the memory and disks on my servers! (Cue evil laughter…)