I want to make money reselling web hosting. I see two paths: Be an affiliate and get money from simple referrals. Be a reseller and buy services and resell them.

If I become a reseller, what do I do, spend $15 a month on 5 gigs of space, and resell the 5 gigs into two or three "chunks" each sold at $20?

That's the basic reseller idea. You buy the larger chunk of space, bandwith etc and then resell it it in smaller chunks. You'll still need to provide support to your customers so your choice in a host can be important. And you do want to know a little about hosting yourself, though some of the hosting details will be left to the person you host with.

Originally Posted by vangogh

That's the basic reseller idea. You buy the larger chunk of space, bandwith etc and then resell it it in smaller chunks. You'll still need to provide support to your customers so your choice in a host can be important. And you do want to know a little about hosting yourself, though some of the hosting details will be left to the person you host with.

Either that, or geting an affiliate account on some host.
Its a hard market with so many offers out there, and you have to pick the hosting company very cerfuly since they are the ones supporting your clients.
If you choose to be an affiliate I do advise you to not GOING on cheap hosting companies... always remember one thing.
Its your "face" the client sees, not the hosting company.

Originally Posted by nbento

... I do advise you to not GOING on cheap hosting companies... always remember one thing.
Its your "face" the client sees, not the hosting company.

Good advice!

I believe that applies to reselling as well as affliliate selling!

Thanks for helping to confirm this basic approach.

I agree with nbento about it being a competitive market. There are so many hosts out there now that it can be difficult to find customers. And it's also true that your customers are going to see you as their host so you still want to find a good host to start out with.

Originally Posted by stevenlw

If I become a reseller, what do I do, spend $15 a month on 5 gigs of space, and resell the 5 gigs into two or three "chunks" each sold at $20?

It's a bit more complicated then that. You will also need a way to accept payments either using a merchant account or 3rd party such as Paypal, both of which will cost you money.

You will also need some sort billing and/or support software to manage your clients.

The "if you build it, they will come" logic doesn't work in this industry, you need a lot of money up front for advertising if you plan to get customers. A solid business plan helps here.
Most companies in the industry will tell to to plan to LOSE money for at least the first year of setting up shop.

Web hosting is a business and needs to be aproached as such. You will not get rich quick, and it's a lot of hard work. If you do not have the capital, hosting knowledge, or desire to run a business then I would recomend you to go with the affiliate route.

For my own scenario, it's more of manual work than using a merchant account to automate the billing process. I personally believe more on the human touch and interaction with my clients. However, I think such an approach will only work well when there's only a small group of clients. Before you do anything though, it will be important to read up on providing webhosting services and planning out what you intend to do.

Both routes you mentioned are both feasible but I would prefer a reseller if you have the knowledge. There's more control from my point of view.