By Joshua Strebel
A lot has changed in the twelve years since Managed WordPress Hosting revolutionized the website industry. Companies worldwide have eliminated website worries from their list of concerns, allowing them to focus on their core business. As a result, managed WP hosting has enabled incredible online growth for businesses both large and small. But despite its success, cracks in the system have been revealed. In a phrase, WordPress hosting is broken. You know it. We know it. And certainly, customers know it.
You might think that sounds a bit self-destructive coming from the CEO of a managed WordPress hosting company. However, consider that we began in 2006 with the simple truth that WordPress could be better. Now a dozen years (and many lessons) later, we recognize another simple truth: WordPress hosting can be better. Much better.
Nothing is perfect, but…
I know that broken is a strong word to use. And to be fair, some aspects of WordPress hosting work just fine. Many businesses experience tremendous online success with a managed WP site, and they’re very satisfied with the level of service and the increase in their bottom line.
But clear deficiencies in the current business model prevent many customers from maximizing value from their investment. These same deficiencies keep hosting companies struggling to make a reasonable profit. So even though most aspects of the business seem to work well, these challenges show rifts that should have been repaired long ago.
The battle for hosting resources
The only things a host can control are base infrastructure and support costs, so a company will create profit where it can. For example at the low-end of the market, sites will be placed on a shared setup or on no-name cloud architecture to spread cost out among many customers. Or, low-skilled support staff will be hired at $8 an hour and given a script to follow during every call. Either option feels broken to me — and to many customers as well.
At the heart of many hosting plans is the expectation that customers will not use a lot of resources. Based on this assumption, hosting providers decide which services to provide and what the skill level of those providing the services will be.
Customers want maximum value, but hosting providers depend on customers to adhere to resource allotments. This sometimes pits customer against provider (and even customer against customer) as conflicting desires collide.
At the high-end of the market where Pagely serves, prices more adequately reflect the true costs of delivering an enterprise-grade product and service, and those prices are typically outside of what wide swaths of WordPress users wish to pay.
Customer vs. host vs. customer
It may seem that one way to maximize profit and avoid conflict is to sell an incredibly cheap hosting plan. Many hosting operations do. Such plans are ideal for customers whose basic, uncomplicated needs can be easily met and maintained.
Make no mistake: Cheap is exactly the intent of these plans. No company can afford to provide good support for a $20/month hosting plan. Providers hire lower-skilled workers to populate understaffed support desks. Then, aggressive revenue requirements force support desk staff to upsell on every support call. It’s unpleasant and annoying to be constantly asked to spend more money every time you call your hosting partner, so it’s no wonder this system might leave a low-cost hosting customer wanting more.
A low-cost hosting plan is sold with the expectation that the customer’s service requirements will be minimal. When these customers disregard the service agreements of their plans, the hosting company is forced to overspend on the customer’s business. The company essentially ends up paying the customer to keep its business.
While it’s true that customers can become annoyed at constant upgrade requests from their hosting partner, responsible customers with appropriate hosting plans in place can begin to feel they are subsidizing customers who abuse their plan’s service agreements. Neither scenario creates a great atmosphere for business growth.
It’s time to fix hosting
So how do we begin to fix WordPress hosting? Like health insurance (another business model that’s broken), the current hosting system relies on a large subscriber base with relatively low expenses to pay for the benefits used by a small percentage of customers. Is that always fair? Most people would say “probably not.” But what is the way forward to create a stronger sense of equity and, ultimately, better value for customers?
We’ve been thinking about this a lot at our company — and we’re working on a solution. For high-end customers that want predictable service levels and budgets, the model still works. For those interested in something more, like building and running dynamic, interactive websites in a serverless, pay-as-you-go-environment, innovation is a must. At the very least, we believe we need to readdress and improve how hosting plans are priced and the way they are presented. Should we continue to follow the health insurance model that imposes a small “tax” on everyone to pay for the support of a few? Should we create higher fees for heavy support users, or should we completely decouple support from hosting? There are a variety of ways to approach the problem — and we’re looking at every possibility.
Joshua Strebel is the CEO and co-founder of Pagely, the first-to-market and leading premium managed WordPress hosting provider. In 2003, Joshua and his wife Sally co-founded and grew a boutique web design agency to a modest level of success in Scottsdale, Arizona. In 2008, he transitioned the agency away from web design and development services and into the hosting space focusing exclusively on WordPress. Headquartered in Tucson, Arizona, this agency developed into Pagely, which has grown into a successful operation supporting brands such as Visa, Disney and Time Inc. with deploying, managing and scaling their WordPress applications. Off the clock, Joshua is a husband and father, automobile enthusiast, aging snow sports participant and connoisseur of single malt scotch.