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Reselling Hosting: Reseller Account vs. Dedicated Server

By December 29, 2016 No Comments

While reseller accounts and dedicated servers can both be used for reselling hosting, they offer different advantages and disadvantages depending on how much control you desire, your budget, and your experience in server management.

Those looking to start an Australian web hosting business, often come across this question, with vocal advocates on either side—sometimes making it difficult to understand which option is right for you.

In order to help you determine whether you should invest in a reseller account or dedicated server, we have outlined the major pros and cons of each option.

Why Choose a Reseller Account?

A reseller account is a type of web hosting where the account holder purchases bandwidth and hard drive space from a hosting service in order to host their own websites or resell their resources to third parties. With this type of web hosting, the account holder essentially acts a middleman by purchasing hosting resources at wholesale price, and then reselling them to customers for a profit.

Reseller accounts are great options for those new to the web hosting business, as they require less time and effort to manage and are often available for a fraction of the cost of dedicated servers.

While it is true that you would have more control with a dedicated server, this would also entail a lot more work and expertise in server management. Managing a dedicated server can be very time-consuming and challenging for those who do not have much experience in server administration; for this reasons, reseller accounts are often an attractive option for those new to reselling, as they typically offer a professional server management team that will handle the task for you.

Reseller Accounts are also much more affordable than dedicated servers. This is also a huge benefit, especially for those hoping to start a business, as reseller accounts can often be upgraded to dedicated servers later on when the business becomes more profitable.

Pros:

  • More affordable
  • Fewer administration responsibilities
  • Typically can be upgraded to dedicated server later

Cons:

  • Less control
  • Less space in some cases
  • Less bandwidth in some cases

For more info on the top reseller hosts, have a look at our comparisons of the best reseller hosting for Australia, the top reseller hosting in Singapore, and the best reseller hosting services in Canada.

Why Choose a Dedicated Server?

Dedicated servers are definitely a step up from reseller accounts with the greatest advantage being that you are in control.

With a dedicated server, the owner has the power to allocate resources at their discretion, choose their own control panel, and download whatever software they desire. This type of hosting is suited for those who have expertise in server management as it gives you root access to the server. And of course, as the saying goes, with great power comes great responsibility, which in this case means that the health of your server is in your hands and you will be responsible for ensuring that your server does not crash.

In order to help identify potential server problems before they arise, and minimize the downtime of your customers’ websites, many owners of dedicated servers hire a third party administration team. Though the cost of this support, in addition to the overall cost of owning a dedicated server (which is typically much more expensive than owning a reseller account), it can be a worthwhile investment for an expanding web hosting businesses with a growing clientele, or a start up with an aggressive growth strategy.

Pros:

  • Complete control
  • Professional

Cons:

  • More expensive
  • Requires you to have server management expertise or to hire a team to monitor your server and prevent downtime

If you are still debating between the two options, the best thing to do is it consider your finances and estimate how many customer you plan to have. If you are planning to have many customers, investing in a dedicated server can be a great way to invest in your business’s future growth. However, if you are new to the business, or if you do not have much expertise in server administration, starting out with a reseller account may be a better option for you, as it is a great way to get started and you can upgrade to a dedicated server once you have more experience.