What is Over Selling?

Overselling is when a company sells more of a product than it actually has available or can actually provide.

In the case of web hosting, it is common to sell several customers 10gig of bandwith even though the company may only have 20gig total. They assume that everyone will not use all of the bandwith and that they do not need the total they sold.

This is bad because you may not actaully be able to use what you pay for. Your website could actually be closed because thir isp closed the hosts account because the sum of all their customers exceeded the paid total.

OK, that is confusing. So lets look at a more common practice. Overselling of airline seats.

It is very common and has always been for an airline to sell 125 tickets for a fligt even though they only have 110 seats on the plane. They know that in most cases, some people will not show up and there will be empty seats on the plane. To make more money they sell more than they actually have.

However on the occasion that all the people do show up, the airline if forced to tell some customers that there is no room on the plane for them even though they have paid for a ticket several months in advance. The customers are obviously angry, but the airlines continue to oversell.

We see the same scenario in datacenters that sell 2 to 3 times the actual bandwith they actually have coming in. So if one third of the customers actually used what they paid for the other two thirds would have no service.

In the case of the data center they distribute loads and split the data between clients, so everyone has service, but they are a fraction of the normal speed. So all the customersare losers with slower than normal speeds.

If you see frequent slowdowns at datacenters it is likely because they do not have enough bandwith to support all the customers.

Think of 100 people trying to take a shower with the entire neghiborhood being supplied water by a garden hose. When 1 person turns on the shower it is fine. When a second person turns on the shower the water is cut in half. As more people turn on showers the water slows down to a trickle or just a drip.

The same is true for bandwith. You only have so much and the more people using it the slower it is.

If all the people took a shower 1 at a time everyone would be happy. But we know that people tend to take showers in the morning and night. So it is more likely that those times will have less pressure or no water at all.

There should be laws to prevent overselling of bandwith, however there is little regulation for interent businesses. So they continue to sell more than they can deliver and offer outrageous packages with seemingly unlimited bandwith for pennies on the dollar.

You could never run a water company from a garden hose. But that is exactly what happens with hosting. A company buys a T-1 which might support a few websites and they sell hundreds or even thousands. If your website is slow at peak traffic times, you may be a victim of overselling.

If you have a deal that sounds too good to be true, it probably is.

Imagine if people could oversell rental appartments. Rent appartments to 2 families and hope one does not show up. Its not acceptable in the real world and should not be allowed in the cyber realm. But it happens every minute making everyone think web hosting cost only pennies when the fact is, they are only getting pennies worth of service.