I see that some people invest in small, loss making web hosting companies. They are willing to take the business and pay for it. I don't see how they will benefit from a company that is not making any profit at all.
Is there any business strategy in it ? Or are they trying to trick some customers ?
Abhi Most companies who do this are actually only interested in the order book in terms of potential new prospects (in the sense of clients). They aren't interested in the technology
They want those clients ? Is that why they are buying those companies ?
Sounds much like slave trade. Ourselves being the slave. 🙁
I also think the same, all they need is Client data and showcase themselves to others saying we have these number of clients.
Jason that's exactly right. It's for the order book and clients, not the infrastructure. Snap up the competition to keep your profit margins from falling.
What is your guess ? Do they buy a lot of such struggling hosts ? Or stop at small numbers.
I don't know how they dare to move the current content to their own server. God knows what resides in them.
I think this is what Endurance International Group (EIG) was doing and still doing i think. Buying hosting companies and having themselves huge client database and provide poor service.
That sounds like a good example of such actions. No doubt there will be players who adopt similar tactics. But I am sure they will have to keep a good tab on their funds if they are on a buying spree.