This is completely relavent to the type of content your users are delivering and what you will ALLOW them to use and do on their sites.
As an example: A typical internet site which serves 1000 requests per day and is fairly optimized in size (images, etc) might use only about 5GB per month. A typical web based chatter program with 50 online users can use in excess of 30GB per month (1GB per day). Since 30 GB per month is roughly 1/3 to 1/2 of a T1's bandwidth, you can see that its in your best interest to basically buy the connection you can afford best and then quota your users accordingly, and/or charge extra for the extra bandwidth. Most companies charge .05 to .10 per MB, which equates to $50 to $100 per extra GB. You could also charge it in some wholesale fashion. Depends on your outlook for a hosting company.
My basic suggestion from the point of view of someone who consults with hosting companies and places that deal with sub-leasing web space: Start out small, buy or lease a dedicated server and rely on another company's backbone to provide your bandwidth. Place your server into their controlled environment and negotiate with them to get a good wholesale bandwidth cost on a multiple DS-3 or OC3 network. Then resell space AND bandwidth to your users. This has several advantages:
1) The cost of setup of a major connection and the monthly costs of renting the line. DS-3's can cost in upwards of $5000 to $10,000 per month (depending on your area). Hosting on another's backbone allows your bandwidth to be more scalable and usually reduces your setup fees significantly.
2) The cost of redundancy (very important to a serious client) -- you don't have to burden the cost of several DS-3's, nor do you have to wait for setup of the connection.
3) the cost of administrating a backbone -- You do not have to setup the network hardware or pay for setting one up. If the underlying network hardware (routers, etc) go down, you are not burdened with that cost or time. Many dedicated backbone providers have excellent reliability records and that is due to a professionally trained staff, which is costly. You also are not having to rent a business space.
5) The cost of an operating environment -- Professionally hosted services should not be originated from your garage or your den. They should be contained in a controlled environment which many companies provide. This also protects you from power outages, as these systems have considerable power backup systems.
4) The cost of backups -- this can go both ways, but allowing the host company to perform and store your backups gives you peace of mind and the time to perform other tasks for your clients, not to mention provide the same security to them.
5) You still have control -- Co-locating or leasing a dedicated server still gives you ultimate control over that system. You are not limited by what the host provides if you wish to resell you space. You can provide specific features to your client.
However, if you are very serious about becoming the next hiway.net or vservers, here are some things to think about:
1) Connections cost alot of money.
2) Professional Hosting servers cost between $3000 to $50,000 apiece.
3) Professional and or certified persons in the computer field make at start $35K per year, and many experienced professionals will not work for less than $50K. If you expect to do network management, handle sales and admin as well, count on 100 hour work weeks minimum.
4) If you expect to rely on consultants to handle network problems, expect to pay $60 per hour during office hours (minimum) and double that if your network crashes on the weekend or at night.
Just some thoughts,
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Fred Hirsch
Web Consultant & Programmer
