It’s all in the game, part 4: hosting your online games for the right price

Welcome to the fourth and final article in our short series of blog posts on hosting for the online gaming industry. With one day of GameConnection Europe left (Leaseweb’s booth is #220), we would like to discuss one final piece of the MMO hosting puzzle: getting the right price to host your online games.

In 1993, seminal first person shooter Doom was released and its development budget was $ 200.000, making it one of the most expensive games ever to be created at the time. Now it is 2011, and we’re just weeks away before the launch of highly anticipated MMORPG Star Wars: The Old Republic. Its rumored production budget: $ 135 million, more than any other game to date. To put this into perspective, CGI heavy movies such as this year’s Rise of the Planets of the Apes and Conan the Barbarian cost the same (or less) to produce. And we haven’t even started with costs like marketing, licensing and distribution, which may or may not be included in stated production budgets.

But even if you are a small indie game developer and don’t have astronomically high budgets to work with, there is still one important but often overlooked cost: hosting. This is an unavoidable expense for online games and can form a big part of your operational costs. But how do you find the right price for your hosting?

First of all, we have to work on the assumption that cheap or expensive does not have to mean better or worse. The goal is to find a solution that matches your needs for the right price. For some this might mean a standardized hosting package. Others might get more bang for their buck when they build their own custom solution. But no matter what hosting solution you choose, they all consist of several building blocks that you can play around with:

1. Location: You should aim to have the best connectivity possible, but every hosting location adds costs. By strategically consolidating your servers into fewer locations, you can already save a lot of money. Remember: Excellent networks need fewer locations to maintain good connectivity with a large reach, while large hosting providers benefit from economies of scale. They can buy in large volumes, enabling them to competitively price their products.
2. Managed or unmanaged hosting: Look at what your company can do by itself. If you have enough in-house knowledge of networks and server software, you can opt for a more hands-on approach through unmanaged hosting. Aside from saving costs, it also means you are much more flexible and don’t have to depend on others to keep your servers running.
3. Colocation or Leasing/Renting servers: You will also have to choose between colocating or leasing hardware. Below we’ve compared the two against each other:
   

   	Colocation	Leasing/Renting
   Description	With colocation you rent rackspace in a datacenter that you can use for your own hardware. This gives you complete control and more flexibility in terms of hardware, but is more time consuming, adds additional costs and requires in-house expertise to take full advantage of both hard- and software. Also, keep in mind that the upfront investment for a colocation infrastructure can be quite large. This is offset by the fact that colocation can be cheaper in the long run.	Leased / rental servers (aka dedicated servers) provide you with hardware owned by a hosting provider, which are hosted in one of the datacenters the host is active in. The hosting provider maintains the hardware and will repair or replace a server if it breaks down, making it an ideal option if you can’t or don’t want to invest in the manpower for hardware maintenance. Leasing hardware requires a relatively small financial investment to get started, though it might cost more when compared to colocation over a longer period of time. Your choice of hardware is limited to what the hosting provider can offer you, but some providers offer custom-built servers. Leased servers are often delivered very quickly – sometimes within a few hours
   Billing components	Rent for rackspace Electricity Traffic	Rent for hardware Traffic
   Additional costs	On-site staff (or remote hands) Your own hardware Keeping a stock of spare parts	Remote Hands / SLA (if required)

4. Type of network: Different hosting providers have different kinds of networks. Leaseweb for instance has a standard and a Volume network taking customization and financial flexibility to a new level. The Volume network includes an economical mix of transit providers, allowing for the reduced cost to be passed on to the customer. Our other network is the Standard network, which includes more transit providers and better speed to those hard to reach providers on the Internet. This way, depending on the type of application you are hosting at Leaseweb, we are able to recommend different solutions at varying price points and grades of service.
5. Various billing models: Depending on the performance of your game, you can gain substantial economic advantages by selecting the right billing model. There’s quite a variety, which we have described in a previous blog: how we bill for bandwidth.
6. Additional services: Ask yourself what other features you require to keep your games running smoothly. For instance, having a SLA on top of a 24/7 support service guarantees your games will experience minimal downtime.

You may also want to take future developments into account. What if your online game is more successful than anticipated? Or what if it’s less? Some hosting providers work with monthly contracts, which mean you always have the option to create a setup that matches your needs. Aside from that, it never a bad idea to check if a hosting provider has a promotional program that offers you the benefits you need.

As you can see, there are a lot of different things that influence your monthly hosting costs. But gaming is serious business, and having a lower bottom line helps you stay competitive. The key lies in finding the right balance between your game’s requirements, how much hosting infrastructure you can manage yourself and of course: the price of each decision.

That’s it for this week, and for this series as a whole. But it doesn’t have to stop here of course. You can still meet our online gaming consultants at GameConnection Europe (booth #220). Feel free to come by and say hi or ask questions about hosting and online games. You can also contact us through sales@leaseweb.com, leave a comment in the section below or tweet us (@Leaseweb).

 

The complete ‘It’s all in the game’ blog series:

1. Reliable Hosting
2. Worldwide Connectivity
3. Fast Scalability
4. Efficient Pricing