Unlimited Space + Unlimited Transfer = Limited Truth In Web Hosting Advertising

There's a dirty little secret out there amongst hosting companies, and that is what they call "Unlimited" hosting, usually something like "Unlimited Diskspace/Storage" and "Unlimited Transfer/Bandwidth."  Obviously, if this were completely true, companies like Ebay, Amazon, Wikipedia, and Craigslist would simply sign up for them too.  The reality is, you will have to upgrade if you have a moderately busy site, but it's too complicated to explain to the average customer.

With web hosting companies offering unlimited bandwidth, storage, and support, how can the leading brands on the web be offering their hosting services for only a few dollars a month? And if they really can offer these services for so little, how come purchasing VPS hosting and dedicated hosting can cost so much more - to the tune of hundreds of dollars per month? With such large price variations, the average web host consumer needs a little help in figuring out the best way to determine their needs. Well, fear not - this article is going to help you decide whether "unlimited" hosting services or a dedicated/VPS server is best for your needs.

FACT #1:  Hosting Companies are Overselling & You Probably Won't Use That Much in the Beginning

The reason most modern shared hosts can offer "unlimited" bandwidth and storage is that hosting companies are mostly banking on the fact that you really won't use that much, especially considering the ever decreasing costs of storage and transfer.  They are overselling their hosting services.  There are a few companies that do not oversell, and in return, they tend to be much more reliable in our experience.

Most small, new websites will use a tiny fraction of the diskspace offered.  In most cases, less than 1/1000th of the limits they are offering you.  This is even true for hosting companies that offer a couple gigabytes of storage space for your site.  We have rarely seen a site that has exceeded limits here.  Traffic on most small, new sites alse tends to be low relatively speaking. Of course, there are lots of exceptions to this rule.  Hosting companies are playing a game of averages here, knowing that on average, most people will use very little resources. 

Like your home computer, hard drives are used at hosting companies to store your website.  Hard drives are very large now, and probably much like your home computer, you really won't use that much space for your website (unless you are a power user). Websites haven't gotten that much bigger over the years, but hard drives have, driving down the cost for hosting companies.  The same is true for bandwidth (a.k.a. transfer).  It has gotten cheaper, and most websites really don't need that much.  It's cheap for the hosting company.

Actually, as of late, many people have started using their hosting company to backup their home computers, which has put a strain on these companies that oversell, forcing them to spell out various rules against using them as a backup service.

So, what is the bottleneck you ask, and what are they actually selling?

FACT #2: You WILL Run Out of CPU and Memory Long Before You Run Out of Diskspace or Transfer (if you are using it properly)

This is a bit technical, but don't worry if you don't understand some of the details.  Realize that your website is hosted on a server, which is just very much like your home computer (but usually in a different shape, and more specialized for hosting purposes).  There are usually dozens, or hundreds of websites hosting on each server.

A big host like Bluehost defines their server limits as a number of CPU seconds used which are equated to real-time seconds; if a website has 200 processes in a minute and each uses .4 CPU seconds, your website would be suspended. If those processes took two minutes, then the website would remain running. Most web hosts try to avoid explaining the technical side of this, and instead try to sell to customers based on how many domains can be hosted with one account, and how much space a website is allocated.

In short, if your site starts to get a lot of traffic at once and slow down your website, it's going to hog up that servers processor (CPU); which in turn will make everyone elses website on that server go slow too.

The same is true for memory (RAM) usage.  Some hosts even give you a short history of your site's CPU and memory usage.

Data Storage:

In recent years, backing up your home computer data online has become a growing trend (e.g. http://www.backup4all.com/, http://www.handybackup.net/, http://www.educ.umu.se/~cobian/cobianbackup.htm, etc...) The problem is, it's not cheap, so people tend to look for cheaper alternatives.  This led to people using their hosting accounts for this purpose; however, hosting companies soon caught on, and immediately tried to put a stop to the practice.  If you have music, movies, or a lot of data (e.g. 10's or 100's of gigabytes) then this rapidly depletes the disk space of your hosting company; especially if a lot of people start doing the same. In comparison, most small websites are less than a gigabyte, but in some cases, can range into several gigabyte range (rare). 

There are exceptions to this rule.  For example, Dreamhost is probably the most ideal since they allocate you 50GB for backup purposes, specifically for backing up anything you want besides your websites.  They are also one of the few hosts that don't state finite limits on your "unlimited" hosting, but rest assured, they will be getting in touch with you if you get to that point that you need a bigger plan.  By then, hopefully you have figured out how to justify the cost of the upgrade.

There are lots of other ways people try to use hosting accounts that simply is not allowed on most shared hosting including:  game server, file/file-sharing/chat server, spiders and other software that can run continually.

If you're interested, hosting companies do state this in the fine print.  In fact, we've included some examples at the bottom. Don't let them confused you.

FACT #3:  Most Hosts Have More Than Enough for the StartUp Website, so Shop on Customer Service Quality, Uptime, and Other Features

With the thousands of sites we have worked with over the years, almost never has a site exceeded the bandwidth, or storage limits of their hosting account.  In fact, probably the biggest cost in hosting is becoming the cost of support.  One server can support hundreds of websites, but it might take thousands of man hours per year to support those customers.

With this in mind, the factors that really make a difference to your website will be how the host can support your customer service needs, the quality of that customer service, and the actual uptime the host experiences. How quickly does your host respond to your needs? How often are its servers (and therefore your websites) off-line? Are they pleasant about solving your problems effectively?

As Christopher Heng puts it in his fine printe on web hosting article, "you will never be able to use up all of the bandwidth you are provided. Long before you even reach the amount you are supposedly allowed to use, your site will have hit its resource limits."

Dynamic, database-driven sites, such as ones that have PHP, ASP, Perl, Python, and other coding languages, will definitely take up more server resources (e.g. CPU and memory) than a static site--one written in HTML.  This is even more so when your site has poorly coded scripts, and fails to use caching, which can be accomplished numerous ways.

FACT #4:  Why Use VPS or Dedicated Hosting?

If you plan to have a highly-trafficked site (e.g. 1,000's of visitors per day), or plan to run a business on it, in which you are generating a substantial income, then consider cheap VPS or cheap dedicated hosting as a wise investment.

The price of a virtual private server (see cheap VPS hosting article for more) is higher because with a VPS, you are getting more power, resources, RAM, and more control.  In the end, the same system of measuring usage is at work.  You might simply think of it as shared hosting, but with a lot fewer websites on the server.  But you might find substantially lower limits on diskspace and transfer limits because chances are, you are going to use them heavily.

And in the case of dedicated hosting, you are the only website on the server.  If your website outgrows a single dedicated server, then load balancing, clusters, and cloud computing are alternatives. 

You may want to check out our VPS and dedicated hosting guides to find out if these are better options for your individual needs.

Samples of hosting companies terms which state the limitations of "unlimited" hosting:

Bluehost

"UNLIMITED" USAGE POLICIES AND DEFINITIONS

1. What "Unlimited" means. BlueHost.Com does not set an arbitrary limit or cap on the amount of resources a single Subscriber can use. In good faith and subject to these Terms, BlueHost.Com makes every commercially reasonable effort to provide its Subscribers with all the storage and bandwidth resources needed to power their web sites successfully, as long as the Subscriber's use of the service complies with these Terms. By not setting limits on key resources, we are able to provide simple, consistent pricing to our Subscribers as they grow their websites. As a result, a typical website may experience periods of great popularity and resulting increased storage without experiencing any associated increase in hosting charges.
2. What "Unlimited" DOES NOT mean. BlueHost.Com employs complex mechanisms to protect its Subscribers and systems from abuse. BlueHost.Com's offering of "unlimited" services is not intended to allow the actions of a single or few Subscribers to unfairly or adversely impact the experience of other Subscribers.
   BlueHost.Com's service is a shared hosting service, which means that multiple Subscriber web sites are hosted from the same server and share server resources. BlueHost.Com's service is designed to meet the typical needs of small business and home business website Subscribers in the United States. It is NOT intended to support the sustained demand of large enterprises, internationally based businesses, or non-typical applications better suited to a dedicated server.
   BlueHost.Com will make every commercially reasonable effort to provide additional resources to Subscribers who are using their website(s) consistent with these Terms, including moving Subscribers to newer and bigger shared servers as necessary. However, in order to ensure a consistent and quality experience for all Subscribers, BlueHost.Com does place automated safeguards to protect against any one site growing too quickly and adversely impacting the system until BlueHost.Com can evaluate said sites resource needs.
3. Unlimited Hosting Space. BlueHost.Com does not set arbitrary limits on the amount of disk space a Subscriber can use for the Subscriber's website, nor does BlueHost.Com charge additional fees based on an increased amount of storage used, provided the Subscriber's use of storage complies with these Terms. Please note, however, that the BlueHost.Com service is designed to host websites. BlueHost.Com does NOT provide unlimited space for online storage, backups, or archiving of electronic files, documents, log files, etc., and any such prohibited use of the Services will result in the termination of Subscriber's account, with or without notice. Accounts with excessive number of files negatively affect the performance of the server and BlueHost.Com may request that the number of files be reduced to ensure proper performance.
4. Unlimited File Transfer. BlueHost.Com does not set arbitrary limits on the amount of visitor traffic a web site can receive or on the amount of content a Subscriber can upload to his/her/its website in a given month, nor does BlueHost.Com charge additional fees based on increased use of bandwidth, as long as the Subscriber's use of the Services complies with these Terms. In most cases, a Subscriber's web site will be able to support as much traffic as the Subscriber can legitimately acquire. However, BlueHost.Com reserves the right to limit processor time, bandwidth, or processes, memory, or number of files in cases where it is necessary to prevent negatively impacting other Subscribers.
5. Unlimited Domain Hosting. BlueHost.Com does not set arbitrary limits on the number of domain names a Subscriber can associate with the Subscriber's web hosting account

Hostgator

7a.) Resource Usage

User may not: 
1) Use 25% or more of system resources for longer then 90 seconds. There are numerous activities that could cause such problems; these include: CGI scripts, FTP, PHP, HTTP, etc.
2) Run stand-alone, unattended server-side processes at any point in time on the server. This includes any and all daemons, such as IRCD. 
3) Run any type of web spider or indexer (including Google Cash / AdSpy) on shared servers.
4) Run any software that interfaces with an IRC (Internet Relay Chat) network.
5) Run any bit torrent application, tracker, or client. You may link to legal torrents off-site, but may not host or store them on our shared servers. 
6) Participate in any file-sharing/peer-to-peer activities
7) Run any gaming servers such as counter-strike, half-life, battlefield1942, etc 
8) Run cron entries with intervals of less than 15 minutes.
9) Run any MySQL queries longer than 15 seconds. MySQL tables should be indexed appropriately.
10) When using PHP include functions for including a local file, include the local file rather than the URL. Instead of include("http://yourdomain.com/include.php") use include("include.php")
11) To help reduce usage, do not force html to handle server-side code (like php and shtml).
12) Only use https protocol when necessary; encrypting and decrypting communications is noticeably more CPU-intensive than unencrypted communications.

7b.) INODES 
The use of more than 250,000 inodes on any shared account may potentially result in a warning first, and if no action is taken future suspension. Accounts found to be exceeding the 100,000 inode limit will automatically be removed from our backup system to avoid over-usage, however databases will still be backed up. Every file (a webpage, image file, email, etc) on your account uses up 1 inode.

Sites that slightly exceed our inode limits are unlikely to be suspended; however, accounts that constantly create and delete large numbers of files on a regular basis, have hundreds of thousands of files, or cause file system damage may be flagged for review and/or suspension. The primary cause of excessive inodes seems to be due to users leaving their catchall address enabled, but never checking their primary account mailbox. Over time, tens of thousands of messages (or more) build up, eventually pushing the account past our inode limit. To disable your default mailbox, login to cPanel and choose "Mail", then "Default Address", "Set Default Address", and then type in: :fail: No such user here.

7c.) Backup Limit 
Any shared account using more than 20 gigs of disk space will be removed from our off site weekly backup with the exception of Databases continuing to be backed up. All data will continue to be mirrored to a secondary drive which helps protect against data loss in the event of a drive failure.

8.) Bandwidth Usage
You are allocated a monthly bandwidth allowance. This allowance varies depending on the hosting package you purchase. Should your account pass the allocated amount we reserve the right to suspend the account until the start of the next allocation, suspend the account until more bandwidth is purchased at an additional fee, suspend the account until you upgrade to a higher level of package, terminate the account and/or charge you an additional fee for the overages. Unused transfer in one month cannot be carried over to the next month.