1&1 Goes ‘Unlimited’ With Hosting Bandwidth

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The interior of 1&1 Internet's data center in Karlsruhe, Germany.

The interior of 1&1 Internet's data center in Karlsruhe, Germany.

One of the world’s top web hosts is offering “all you can eat” bandwidth on all of its plans. 1&1 Internet has removed the data transfer quotas on its shared hosting plans, the company said this week, retiring one of the oldest metrics in the hosting industry.

The move by 1&1, which has more than 9 million customers, is the latest salvo in a long-running arms race between major shared hosting firms, who have been steadily super-sizing the disk space and data transfer on their accounts for the last three years.

Second-tier hosts have long touted controversial “unlimited” plans. It’s widely viewed as a marketing gimmick that promises more than it can deliver- and far more than most web sites will ever require. In recent years the focus on service tiers based on disk space and transfer quotas has been blasted as geeky and confusing to customers. 

The End of the Unlimited Stigma?
Tougher critics say unlimited account offers are “overselling” - promising disk space and bandwidth that the company doesn’t already possess - and misleading to customers. But any stigma began to erode when the industry’s name brands broke down and joined the trend.

Yahoo introduced un unlimited plan in early 2008. In February Go Daddy also introduced an unlimited web hosting plan, with no quotas on monthly disk space or data transfer. At the time we called Go Daddy’s move ”a clear signal that quota-based pricing for shared hosting accounts is on its deathbed.”

The unlimited hosting accounts offered by Yahoo and Go Daddy were premium plans priced at $11.95 to $14.99 a month. 1&1 Internet has gone one better. The huge host, which is based in Germany but has large operations in the UK and America, has lifted transfer quotas an all  of its accounts, including its$3.99 a month Beginner hosting account.

Lifting Quotas Across The Board
1&1 has also boosted disk space quotas on all of its accounts, which now start at 10 gigabytes for its entry-level plan. A hosting customer who chooses 1&1′s $9.99 a month developer account will theoretically have access to 300 gigabytes of disk space and unlimited bandwidth. 

From a marketing perspective, the offer of unlimited data transfer at these prices may appear to position these accounts favorably compared to dedicated servers and cloud hosting plans that promise more scalability. After all, what could be more scalable that “unlimited”?  

All You Can Eat, But Small Bites Only
The catch is that these “all you can eat” plans only work if the bandwidth is consumed in measured doses. Shared hosting accounts can be fine for low-volume sites, but don’t usually scale for the kind of instant traffic that site owners probably envision when they see UNLIMITED.  In practice, these accounts are often capped or turned off during large traffic spikes.

Here’s why: in the shared hosting model, several hundred customer sites are housed on the same server. When one site on the server gets Slashdotted and begins using more resources, the server bogs down. The operation of one customer site begins degrading the performance of other customer sites – which isn’t allowed under most terms of service.

But 1&1′s gambit serves as a reminder of the many millions of hosting customers who continue to flock to cheap shared hosting, even as cloud providers predict the coming demise of the entire sector. 1&1competes aggressively with Go Daddy and Yahoo - not to mention free offerings from Microsoft and Google - yet has managed to build a base of 9 million customers. The cloud may be coming, but 1&1 and other hosting stalwarts have virtually ”unlimited” resourcefulness, if not unlimited resources.

About the Author

Rich Miller is the founder and editor-in-chief of Data Center Knowledge, and has been reporting on the data center sector since 2000. He has tracked the growing impact of high-density computing on the power and cooling of data centers, and the resulting push for improved energy efficiency in these facilities.

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12 Comments

  1. Matt Jones

    Any bets on this being more like the AT&T "unlimited" data plan for iPhone? In other words, "unlimited" = "there's a limit, we just won't tell you what it is".

  2. Nice article, but unlimited bandwitch and web space has been offered by companies from other countries long ago. Such as superhost.pl from poland. As we know it's only a marketing issue.

  3. This is great news. We can allow our users to upload more photos and include video, especially as 1&1 have upgraded disk space too.

  4. Funny - in Sweden we are going the other way. There is no such thing as unlimited as your hardware and more will dictate what type of bandwidth you can actually get out - and it is different for each customer. So we are throwing out the old "unlimited" as we all know that does not exist in reality. So it is sad to see this come back from such a big player that cannot truly give unlimited - if one knows what unlimited truly means.

  5. Dreamhost has been doing this for years. While it's nothing new, it's also not explicitly publicized by a lot of web hosting companies.

  6. Robert

    "unlimited" is really pretty misleading. Since it does have a limit, it's just not explicitly stated. There's no such thing as unlimited disk. If I were to upload countless files all day they will suspend the account. They aren't going to let me put a few TB's of data, even if there's no copyright issue. IMHO "unlimited" is really just a way of getting around being attacked for customer unfriendly TOS's which allow them to suspend your account for pretty much anything. It's pretty unfriendly to sell an account that explicitly says "500 GB Bandwidth / month" but know that any way a customer could use that would involve suspension due to CPU or memory usage (buried in the TOS). With "unlimited*", that's no longer the case. They haven't been suspending due to bandwidth in years thanks to high allotments. They are just suspending due to CPU and memory usage. If it weren't the case, why wouldn't many large sites just get 50 different shared hosting accounts and have DNS round robin distribute traffic while checking them constantly for uptime. For a small decrease in availability they would save a fortune.

  7. I prefer "unmetered" vs "unlimited" but it does not have the same marketing appeal.

  8. "Unlimited" is a very crooked and deceitful marketing scheme to lure in people (customers) who are technologically illiterate and know very little to nothing about running a webhosting company, dedicated servers, network administration, the actual costs of hosting, etcetera. Dreamhost offers "Unlimited + 50GB" for disk space. That's one step better than just plainly saying "Unlimited." That's like the childish and immature way of saying "infinite plus one" in attempt to win an argument. Isn't there a Latin or Greek term to describe this logical fallacy? What also isn't fair about this kind of competition is that all the big webhosting companies practically own the webhosting market through their dishonesty and twisting words (such as "unlimited") and using these deceitful and dishonest methods to reel in customers. And then the company's that are truthful, honest, and ethical in their ways are no match to "unlimited," and get completely skipped over to lose to a company that is lying to a customer to attain them. This is an unethical monopoly; the market is monopolized by lying and lawyer-like crooked companies. It isn't fair. Why should one become unethical and immoral to attain customers?

  9. Ben

    The "Terms & Conditions" for 1&1 actually put a limit of six gigabytes per month on hosting account. Go Daddy's "Universal Terms of Service" has an even more vague requirement that accounts not have exceed so called "excessive space and bandwidth." These so called "unlimited" accounts are bait and switch marketing that require during sign up that the customer agrees to allow the company to enforce *LIMITS* on the "unlimited" account as stated in the legal document. Go Daddy at least has the sense to put a little plus symbol by the word "Unlimited" to clue people into the fact that they won't follow the standard definition of the word.

  10. There is no such thing as unlimited. There are very few companies left who actually have a limit thats actually show to the public one that comes to mind is www.driphost.com Again there is not such thing as unlimited

  11. Doug

    As usual, merchants are selling products the way THEY want to, not the way their customers want. Take me, for example (and I think I'm a pretty good example). I have a few small, relatively low-traffic web sites that bring in a few extra bucks a month. Most months the bandwdith I use is well within my plan and the price of the plan is quite reasonable. I certainly can't afford - or at least don't want to pay for - dedicated servers and high bandwidth caps when it wouldn't be worth the money. But I live in far of my own success. What if that magic day comes when I get Slasdotted? Under my current plan, I'm sure my site would quickly go over it's "unlimited" cap and get shut off - and there I am, watching a potentially extremely lucrative day for me go down the drain as millions of hits bounce off a 404. I don't want high bandwitdth caps ALL the time. i want "slashdot insurance". I want "Digg insurance". So i don't use lots of bandwidth very often, but I want it when it's needed. I don't mind paying (within reason) if I go over limit as long as the capacity is there when I need it. i want *flexible* capacity. I'd pay a big hosting company an extra $1 or $2 a month for that kind of insurance - "your web site won't go down due to traffic (but we will charge you per GB over )". Or better yet, charge you per GB over your limit, but only up to a predetermined amount - say, "If I go over my limit, keep the gates open and charge me per GB until it gets to $500, then shut it down". like a buffer or "overdraft protection".