Web hosting prices to see a major rise

Following cPanel’s recent announcement that they will be moving to an account-based pricing and licensing structure next year, this could have a very significant impact on the web hosting industry overall.

cPanel is the provider of the graphical interface and automation tools that make it easier for a website owner to manage their website. It provides a simple control panel that users are able to easily navigate to set up and manage their website and hosting.

Some web hosts have their own version of cPanel but the original panel outperforms all of the alternatives, so cPanel remains the industry standard control panel. Many hosts offer cPanel for free in their hosting plans but this change to the pricing approach will have a knock-on effect on the web hosting fees.

When is the web host fee increase expected?

The increase was introduced on January 1st, 2021. Therefore, anyone taking out a new hosting contract or renewing their existing one is likely to see a price hike reflected in the cost.

cPanel communicated the upcoming changes to their partners and distributers via email and explained the rationale behind the price increase. They outlined that their changes are aimed at simplifying the process of adding new servers.

They also said that the existing pricing structure does not take into account the many changes that have happened since the cPanel was first launched back in 1996. Since the original launch, servers have moved on significantly and are now able to run hundreds of sites using just one single processor.

Therefore, the new structure has been designed to charge customers for what they actually use. Each license will be priced based on the number of accounts that are being hosted. They are also moving over to a monthly billing schedule to replace the annual arrangement.

The increases will impact customers in different ways, with several reports estimating an average of a 40% increase, with the majority of the increases varying between 25%-50%. For customers that have over 100 accounts, they can expect an increase of over 100%. Some companies are expecting anything up to an 800% increase.

Web host providers have been passing back their feedback to cPanel to show their frustration at the pricing structure change. The Manager of Community Engagement at cPanel Benny Vasquez acknowledged that they needed to make some changes to the pricing structure after the initial announcement, taking into account some of the feedback they had received as a result.

What is the new cPanel pricing structure?

The price changes for their account tiers displayed on the website show:

Admin account (up to 5 accounts) increases from $20 pm to $22 pm from 01/01/2021

Pro account (up to 30 accounts) increases from $30 pm to $32.25 pm from 01/01/2021

Premier account (up to 100 accounts) increases from $45 pm to $48.50 with each account over 100 accounts being charged at $0.30 pm (up from $0.20) from 01/01/2021.

Under the Partner Program, which is for hosting over 1,045 accounts, a bulk discount is available with the pricing set at $0.175 each pm.

How the increase affects web hosting providers

Web hosting companies have been mostly shocked by the announcement to the changes and were certainly not anticipating a cost hike of this magnitude. For many, the increase has prompted them to analyse the possibility of using alternative, cheaper control panel solutions.

Hosting providers that decide to stay with cPanel and are not using the alternative options will be forced to pass on the fee increase to their customers, through inflated hosting plan prices. Companies such as ukhost4u already give you the flexible option to have cPanel as an Optional extra.  One of the big problems is that cPanel has market domination and so many businesses relied on their services, they are almost being held to ransom in this situation.

It is expected that VPS and Dedicated Server clients will be hit the hardest with this increase. The hosts that are looking to switch over to alternative control panels have been busily trying to get everything set up to enable their customers to migrate over to the alternative option. It will also have a big impact on resellers, as they too will be affected by the price increases.

Some hosts are planning to give their customers the option of using cPanel (with their price inflation factored in) or to go with an alternative control panel option instead. A lot of extra work has been created for hosting providers as a result of the pricing changes, so it has been a very costly experience even before the pricing changes are implemented.

With many businesses already reeling from the impact of the health pandemic, this price hike comes at a very challenging time, so this is sure to have a really big impact on the future of the web hosting service industry.

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