Business plan ideas needed for recent server(s) purchase - experience appreciated!!!

[tankman1989]

I know this is a pretty vague question to ask and I'll admit that I'm a little out of my league with all these servers (3 models, 8 total) I recently acquired for a steal of a deal - so in this plan the servers are already paid off and the only costs I would incur would be electricity, hosting/bandwidth and OS/software licensing. Actually I guess I would need some major UPS systems for this as it is a total of 6,700 watts total peak usage but I have a line on a 6kw UPS system that could do handle all of the servers.

I figure that I have a couple options and the obvious one is to sell them whole or semi-hole, maybe remove the fibre cards if they are not needed and sell them separately. I could part out everything and sell individual components but I don't know how well that would work.

The option I like the most is to start a hosting service of some kind (if possible), probably taking on a partner for admin/management of the VM's, hosting software and selling/reselling service plans. I think if I were to go this route I would try to stay with free open source software as much as possible to start out and then offer MS servers as needed and clientele requires. This idea would basically keep me occupied full time which is kind of what I am looking for but I don't know if I am totally over-looking/under-estimating the requirements of a hosting service. I do have a location that is a 50/50 chance of being suitable for hosting with minimal cost of rent.

The one hurdle I see coming up with the hosting is hard drive capacity as I would have to invest in some NAS units but I do have about 10 500GB SATAIII RAID1 arrays ready to go so that might help out with the capacity until I can invest in some more SAS drives. When I add up all the CPU's I come out to 107Ghz and 228GB of ram so I could offer 100 1Ghz/2GB ram VPS's if it were divided.

The worst part of all of this is that the servers are out of warranty but I don't see as big a problem with this since I have more than enough capacity to start off and as I get contracts I could then add new servers if/when they are required. In addition that everything is redundant as far as PSU's and HD's (RAID1) and I've seen a single CPU fail in a dual system and it just slows it down but is still workable until a replacement can be found.

Dell Poweredge 1950 #1-5 (all 1950 are identical)
qty Item
2 3.0Ghz Dual core CPU - Xeon Woodcrest, 5160
8 2GB RAM 667mhz - 16GB total
2 73GB 15K rpm Fujitsu SAS HD's
1 Perc 5i RAID controller w/256mb RAM
1 Qlogic QLE2462 4port PCI-E 4Gbps Fibre Card
1 Intel dual 1Gbps NIC -2Gbps total
2 1Gbps Broadcom onboard NIC's - 2Gbps total
1 DVD-Rom Slim Line
2 670 Watt Power Supplies

Dell Poweredge 2950
qty Item
2 2.66Ghz Quad Core CPU Xeon Clovertown, X5355
8 2GB RAM 533mhz - 16GB total
6 146GB 15k rpm Fujitsu SAS HD
1 Perc 5i RAID controller w/256mb RAM
2 Intel dual 1Gbps NIC - 4Gbps total
2 1Gbps Broadcom onboard NIC's - 2Gbps total
1 DVD-Rom Slim Line
2 750 Watt Power Supplies

IBM x3850 MT:8864 #1 & 2 (both IBM's are identical)
qty Item
4 3.5 Ghz Dual Core Tulsa CPU's
4 16GB RAM - 64GB total
6 2.5" SAS drive Bays (EMPTY!!)
1 IBM RAID 8i SAS raid controller 256mb ram
2 Qlogic QLE2460 2port PCI-E 4Gbps Fibre card
1 Intel dual 1Gbps NIC -2Gbps total
2 1Gbps Broadcom onboard NIC's - 2Gbps total
1 DVD-Rom Slim Line
2 1300 Watt Power supplies (120 or 240v)

As I said, I don't know what it takes to start hosting so any input on this would be very helpful. I worked for a company that hosted about 30 sites and they used low-stat/quality mid-tower computers that were basically light-weight desktops running RAID5 on Ubuntu.

If I were to sell all the components individually at 1/5 the used price I would still come out ahead so that is where I am financially (I guess this makes up for the 1and1 domain renewal issue).

Thanks for any advice, input or comments!

 

[OfficeTechs]

if it were me id break them all down for spares and market myself as a server spares specialist.

Hosting is more than just about the server hardware its about the infrastructure around it like bandwidth, cooling, security etc.

IMO Hosting is a fairly saturated market, anyone can rent a dedi or vps for less than £100 a month and call themselves a host. I would seriously consider breaking them down for spares.

 

[YeOldeStonecat]

Things about hosting...

*High TOS bandwidth...and redundant bandwidth.
*Backup generator in case power goes out
*Failover site...what if your main site goes down for bigger reasons..power and internet...you want a failover site that has in place servers waiting to be fired up.

I see you keep mentioning tossing those fiber adapters....but now you're talking about hosting services on those servers. For hosting servers...you want high availability enterprise components in there. Fiber adapters allow you to setup your servers to use a larger fiber storage array as their drives. This is where you get your drive storage.....massive performance, flexibility, redundancy, and cost effectiveness. All of which are desirable features.
Here's a pic of a server cabinet I setup many years ago....it's changed a lot now..many more drives in that HP MSA1000 towards the top, but all the servers you see there have their drives using that MSA1000. All those servers have 4 gig QLogic cards in 'em...to connect to that MSA with fiber.

Picture is very outdated.....server cabinet has lots more in there now...and the MSA has every drive slot filled.

 

[Cornerstone Technologies]

if it were me id break them all down for spares and market myself as a server spares specialist.

Hosting is more than just about the server hardware its about the infrastructure around it like bandwidth, cooling, security etc.

[/QUOTE]

I would have to concur with this the most. Simply because you have what I would consider obsolete servers, doesn't mean you should use them for what you are thinking. I would imagine if you had several millions of dollars, you could very well start a small regional hosting company. Part them out, do whatever, but I think what you are looking to do is not feasible or recommended to be offered to clients.

 

[NorthernSpares]

I do not have a business plan however I do have an optimistic can do attitude!

How about a joint venture? (Not with me!) I am based in England so I am unsure of your where you are but could a local University or College provide you with a pool of talent who could be potential partners who have the technical background? I am sure a young eager server admin would be interested in the eperience working for the company?*

As for financial viability some thoughts from my head on this are as follows.

Yes you are using older equipment but that is ok as long as it is propper, fit for purpose and most importantly is well maintained. Servers can be set up to OS with a qualified operator in very reasonable time so that really isn't an issue. Schedule maintenance and stick by that schedule, well maintained equipment can go on forever**

Redundancy. VITAL. Co loacting across two sites minimize's risk however comms costs double but again I believe worth it.

Costs. It will be a loss unless you can bring clients on very quickly, this can be offset by lowering the server's you bring online subject to above.

Marketing. Slick marketing in a saturated market would be prudent. A gentleman above posted about local market appeal and I think that is a wise idea. People like to buy local and in the form filling, macro completing world of the internet a face would be welcome. Especially a local one.

Disaster. Always one to prepare for the worst. If your redundancy plan works a high level with the t's crossed and the i's dotted then you can forget this bit otherwise! Imagine fire, flood, Matters beyond your reasonable control, Act of God*** or just general infrastructure breakdown. You know those days when it doesn't matter what you touch it turns to dust/lump of plastic.

Reputation. Is key, do NOT abuse trust, go naitive, disapear or head for the state lines (Presumably) Pay bills on time you cannot afford to make any housekeeping errors.

Ongoing. If all goes to plan and everything behaves as it should and making some massive assumptions in my head if you get 50 customers at 49.99 a month that is 3000 per month. Not bad. Just do not take your eye off the ball!

I hope my thoughts are of some use to you!

* Subject to vetting and confirmation of practical application of skills
** British readers of a certain age will remember Trig from "Only Fools and Horses" Who has an old brush. He has only replaced the broom handle twice and the brush head five times!!
*** Subject to religious views of course.