In this case, please understand low end companies = offers under $7/month. Inside these companies' group we have a few ones that have an unique focus: PRICE.
So, my doubt is: how can they make that prices and if they can earn money with them?
Economy of scale?
No support? Yes, support cost time and money.
Automatization?
I'd like to know what is the limit that a provider can make money and after that it is trying to appear and advertise its brand.
I know some companies open and some close the doors each day. It happens in all niches.
I can see some companies need to close locations and start little again (with 1 or 2 locations) and with their own hardware.
I do not believe if you have your own hardware it means you will earn money. Maybe it can be a good thing if you are near it and can do support.
Is it mandatory to earn money and be competitive to have your own hardware? (I am talking about the BIG ones with very low prices).
Maybe I am wrong, but in my mind it is difficult to see the difference of a BIG provider and a little one. Some guys could say the SUPPORT can be a difference. Really? For each side? Overselling or not?
If you have hardware but no clients, you are losing money. If you make promotions and do not have support, you will lose clients and money in a near future.
I'd like to have an idea about the real costs involved and how they can make money.
If you need to see a few offers under $3: comparevps.com
I could read a nice explanation some time ago here in LET but I could not find the topic again.
This guy gave an example about costs, but it has not the focus in this niche: PRICE. axelsegebrecht.com/how-to/make-money-offering-vps-hosting/
The best thread I could read about this: webhostingtalk.com/showthread.php?t=1037747
All these companies with offers like "128Mb for $1" are overselling, right?
IP space + support cost + hardware + taxes = how can they pay for them and make money?
Is it possible to COMPETE with them? How?
Thank you!