Thank you NewBlock for your feedback. While we would love to give prices 40% below our current, that is simply not possible. In fact I would strongly advise anyone to double and triple check any hosting or colocation company for fraud that is offering that low of pricing.
Hosting companies allow miners to save the substantial initial outlay cost of building their own facility. If you were to lease a cheap warehouse and build a small 500 kVa set up, you'd spend over $150,000 on the build and $1,800 a month in rent. Furthermore, you would need to show substantial credit and a history of usage to obtain cheap electricity pricing from a supplier. Without that, you will be spending 9 cents per/kWh easily for commercial (price from supplier + utility distribution charge). You will then need to have someone staffed to tend to the facility and fulfill repairs or warranty shipments to the manufacturer. You will also need to have insurance, security systems, and storage of maintenance supplies.
Besides the fact that you are now exposed to substantial risk for signing a 5 year lease on a building, your price per kWh would look something like this:
(assuming 500kVa load or 350 S9s)
Assuming you built your facility correctly and designed for proper airflow and network efficiencies..
1. 0.09/kWh from energy supplier and distribution
2. 0.00469/kWh for rent expense
3. 0.013/kWh for operational labor (assumes one person for this one specific operation - cost here is lower when you have a larger facility)
4. 0.000956/kWh for internet, security, and insurance
5. 0.013/kWh for buildout repayment of investment (assuming expensing depreciation over 3 years)
When calculated, doing the above would run you around 12.2 cents per kWh on average from an operational cost analysis prospective. This does not include many other expenses involved. You would also be exposed to substantial risk as you will have to ensure the miners you purchased will last you for years, or make sure you have the capital to reinvest in new miners. You would have to make sure you can mine for the duration of the 5 year lease agreement, or at least over the buildout expense depreciation period you chose.
When you host with a hosting company, you are receiving more than just electricity. You are paying for a service and the ability to not be bound to a large capital investment on a buildout. You are relieving yourself from the headaches of designing a proper facility that will work and last. Our prices include everything mentioned above plus more, and is still much less per/kWh.
What we offer is a full hosting service, which is different than simply putting miners on a shelf and leaving them unattended. We employ a team of engineers and technicians to monitor and manage the ongoing health of the servers located with us.
Other hosting companies which may actually only identify as a "colocation" business, will simply only put your miner on a shelf with an ethernet connection a power cord. If it doesn't hash they won't know about it and probably won't care. Their obligation is to power and serve it internet. If the miner is at "fault", it is not their obligation to make sure it works. These companies that charge much less for these services are typically the ones that do this. Many people are left with contract terms of miners that are sitting on shelves frozen and not mining.
We are proud to have an attentive staff that is passionate about this industry and helping others in it. If you have any questions about our business, we would love to answer them.
Happy mining!
Founder & CEO
Nick