does anyone still fall for this? when it comes to shared hosting setup should never be charged since in most cases account creation is automated. however, renting a dedicated server requires more work so a setup fee would make sense. just some FYI.

There's nothing wrong with setup fees depending on the business model of the hosting company.

There is a load of valid reasons for having a setup fee. With the amount fraud going on, a hosting company has to put a lot of time into manually checking orders for fraud. And as you know, time is money. Other companies add a level of automation in addition to the manuall checking. For instance, every order we get goes through Fraud Gardian and in turn, we get charged whether the order is accepted or not. This needs to be made up for somehow.

Also, having a setup fee will help eliminate some of the fraudsters and spammers from ever trying to signup to begin with.

Having a setup fee also allows the host to lower it's monthly fees. This helps them compete with the low-cost budget companies out there, yet still be able to pay their bills.

You have to remember some of these will be start up businesses as well. So the set up fee can help them gain a bit more money to put towards better servers e.t.c for the future.

Setting up a new customer/account is not just about the account creation. In addition to wht has been mentioned above, I will add that it is quite common for a new customer to need a lot of support in the early days of using the service. The setup fee can help in covering these higher initial costs.

true, loads of companies have setup fees, there is nothing wrong with that. If you dont like it then choose another host.