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The Internet Businesses

20 Low-End VPS Providers Suddenly Shutting Down In a 'Deadpooling' Scam (zdnet.com) 41

Posted by EditorDavid from the with-great-power-comes-great-irresponsibility dept.
"At least 20 web hosting providers have hastily notified customers today, Saturday, December 7, that they plan to shut down on Monday, giving their clients two days to download data from their accounts before servers are shut down and wiped clean," reports ZDNet.

And no refunds are being provided: All the services offer cheap low-end virtual private servers [and] all the websites feature a similar page structure, share large chunks of text, use the same CAPTCHA technology, and have notified customers using the same email template. All clues point to the fact that all 20 websites are part of an affiliate scheme or a multi-brand business ran by the same entity...

As several users have pointed out, the VPS providers don't list physical addresses, don't list proper business registration information, and have no references to their ownership... A source in the web hosting industry who wanted to remain anonymous told ZDNet that what happened this weekend is often referred to as "deadpooling" -- namely, the practice of setting up a small web hosting company, providing ultra-cheap VPS servers for a few dollars a month, and then shutting down a few months later, without refunding customers.

"This is a systemic issue within the low-end market, we call it deadpooling," the source told us. "It doesn't happen often at this scale, however."
ZDNet provided this alphabetical list of the 20 companies: ArkaHosting, Bigfoot Servers, DCNHost, HostBRZ, HostedSimply, Hosting73, KudoHosting, LQHosting, MegaZoneHosting, n3Servers, ServerStrong, SnowVPS, SparkVPS, StrongHosting, SuperbVPS, SupremeVPS, TCNHosting, UMaxHosting, WelcomeHosting, X4Servers.

However, "A user who was impacted by his VPS provider's shutdown also told ZDNet that the number of VPS providers going down is most likely higher than 20, as not all customers might have shared the email notification online, with others."
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20 Low-End VPS Providers Suddenly Shutting Down In a 'Deadpooling' Scam More

20 Low-End VPS Providers Suddenly Shutting Down In a 'Deadpooling' Scam

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  • Of course, you have backups of all that data you have in the cloud. Right? Right???

    Anyone who trusts some random internet service to preserve their data deserves pretty much whatever they get. Especially if they went with the cheapest service they could find. But then, it seems that everyone has to learn this lesson the hard way.

    • I'm (I was?) an ArkaHosting customer. (Haven't gotten the email notice though. WTF?) Have a massive database hosted on one of their VPS instances, but it's a MariaDB slave copy of one that lives on my NAS at home. This will be an annoying PITA, but yeah, I never trusted them fully at that price. Use em while it lasts, but be prepared to roll out to a new host if needed.

  • I don't know the rules in the US,
    but over here this would be illegal in more than one ways.

    First of all, if you provide no human physical contact and business registration infos in your imprint page, you aren't even a business, period. A physical contact (a real person and address) is mandatory in any case, business or not.

    Andif you have a contract, the partner is obliged to provide what was promised, or provide an acceptable substitute. Like paying damages.

    So ... is this shit actually legal in the US? Or i

    • Re: (Score:1)

      by DRJlaw ( 946416 )

      So ... is this shit actually legal in the US?

      So, is this trolling actually legal in the EU?

      Or is somebody going to prison?

      I don't know, since I don't know if they had any EU customers so that the crack EU law enforcement authorities will track them down, regardless of where they're located, and bring them to justice.

      In case you don't understand yet, TFA did not say anything about any of these services being based in the U.S., the EU, or elsewhere, so why are you incredulously asking whether committing fraud

      • Businesses in the USofA so often run rough-shod over their customers, and get away with it, that it is not that unreasonable to assume that this was a US-based event (/. may have an international audience, but it is a US-based and -focused site).

    • Given the vagueness of the hosting, they could also be hosting on the hacked servers of a legit company. Not the first time this has happened, in some cases they've been quite straightforward about it, "the admins at XYZ have discovered our virtual servers on their systems, you have 30 minutes to get out".

      Oh yeah, nearly forgot: Welcome to the cloud!

  • I tried two of these services (KudoHosting and MegaZoneHosting) for hobby projects I didn't care about. Got them both refunded through PayPal because the "SSD" read and write speeds on MegaZoneHosting was measured in the kilobits per second, and KudoHosting just flat out didn't respond to pings after the first couple hours. Now I host my sad hobby projects on AWS Lightsail and it's working fine (at least on the rare occasion I check on them).
    • I've had good luck with linode. Going on 3 years I think now. I am on the 10/mo plan, but I think they have a fiver plan. I try not to expand amazon any more than I have to. Monopoly is not good. I played as a kid. Never ends well.

      • Re: (Score:2)

        by slazzy ( 864185 )
        There are lots of great VPS companies that are in it for the long haul. OVH, Linode, Digital Ocean, Vultr and Ramnode are the ones I use.

        • Re: (Score:1)

          by Anonymous Coward

          As someone who runs servers, I'm getting tired of the VPS IP space attacking my systems. I'm now wholesale blocking them.

          This is the problem. When you use VPS, you align yourself with botnets and hackers and a lot of hardcore black hat activity.

          Don't be surprised if you can't access a lot of web sites. We don't want that shit traffic. We don't give a shit about who you are - we aren't profiling you, but we aren't also interested in a shitton of cross-scripting probes and injection attacks. So serious

          • Agreed.

            I get endless scans from IPs which resolve back to one of these organizations.

            Now I 'whois' to find out the address range of that subnet and block the whole thing. If one IP is compromised or malicious, the whole subnet must be deemed suspect.

            • Re: (Score:1, Troll)

              by Amorious Cownut ( 6444472 )
              Right, the servers hide behind Cloudflare and AWS, but damn the fucking lusers who share an IP address due to CGNAT or are even just in the same subnet as someone they don't know. Collective punishment is such a nice move. Asshole.

        • Re: (Score:2)

          by pnutjam ( 523990 )
          I've been very happy with Time4vps.

  • ColoCrossing Strikes again (Score:3)

    by OverlordQ ( 264228 ) on Sunday December 08, 2019 @04:16PM (#59498704) Journal

    Some reason these scammers love ColoCrossing.

    • They ARE colocrossing.

    • It is too early for conclusions. I did some digging and seems like only 1 and not yet closed is hosted on Colo. Most are hosted on Linide/Vultr. There is a clear pattern they are connected tho. I have all the data here if you are interested https://hostingchecker.com/mor... [hostingchecker.com]
      • You're looking up the wrong IPs. Company websites are almost always hosted on a different provider than the services they provide, for redundancy/outage reasons. Their actual services *are* all hosted at Colocrossing, and follow a multi-year pattern of doomed-to-fail hosting providers that all seem to have *just* a little too much involvement from CC itself. There's many years of documentation around CC's business practices and involvement in failed providers hosted there, hardly "too early" by any reasona
        • They all seem to be connected in GA. Not sure how I missed that. I have updated the spreadsheet with the companies that are in the same GA account.

  • Not a total scam (Score:3)

    by Art Challenor ( 2621733 ) on Sunday December 08, 2019 @05:32PM (#59498842)
    I think it's a little disingenuous to suggest that these hosting providers started up with the express intention of closing within a couple of months. I've hosted with one of them for over a year. Uptime was acceptable, service was tolerable - it was a fine, low-end VPS. While I'd be reluctant to use these super-low-cost solutions for anything critical, the same rules apply to any provider - make backups and be aware that changes in service, including dropping the service, may happen. It's not as if big providers are stable - in those cases it's usually that they hike prices unacceptably but there are other possibilities (Google+ anyone?).
    The timing is a little suspicious, but it also corresponds to a major change in the pricing model for Control Panel which is going to cause almost all providers to increase pricing, stop offering Control Panel or go under. I had a 99Â/year test hosting account, for which Control Panel have just increase the price for the provider to 20Â/month - clearly not a sustainable proposition.
    • Colocrossing has been involved in this sort of shit for many years now. It's not some sort of isolated incident. This is just the first time it's hit the press. (Also, the cPanel price increase was announced quite some time ago; these providers *continued offering* unsustainable plans *after* that price increase was announced. If that doesn't suggest malicious intentions, what would?)
      • I doubt that Colocrossing is directly involved - just an enabler. Providers come and go - it's not the first VPS where the (low-end) provider has gone under on me. It just happens to be 20 - all of which we can reasonably assume were actually the same provider.

        That said, I agree that waiting until after black Friday/cyber Monday seems malicious. It was even possible to buy an account on these providers after they sent out notice that they were ceasing operation.
        • Like I said, this has been going on for many years, and this isn't the first load of Colocrossing-based providers that deadpools under suspicious circumstances, with seeming preferential treatment by CC. There's a point where this recurs so often that pattern recognition kicks in, and it (rightly!) starts looking a whole lot like CC is involved themselves. There are mountains of evidence against them.

        • White labelling seems to be quite common in the lower end shared server and VPS business, so it was likely one white label hosting company that went bust and took a bunch of resellers with it.

    • Re: (Score:3)

      by jrumney ( 197329 )

      The low end VPS market is pretty cut throat. SWVPS went bankrupt after I'd been with them about 8 years. Not because they were scammers, but probably they were too nice - after I'd been with them 5 years without any support demands, they cut my prices in half to $2.49 a month. They' went through a change of underlying server provider after their upstream hosting prices were jacked up on them, which I think put a load onto their support team that they couldn't handle, even though they kept the old IP addre

  • It's it just me or do 90% of the site names scream 'SCAM!!' ?

  • I'm a SparkVPS customer so I can have a VPN service with a less obvious IP than, say, Amazon. I've heard nothing from them so far and I can't see any notices or messages on their customer portal. Maybe not all customers are affected. Mine's just a bottom-of-the-range VPS.

    • Re: (Score:2)

      by jaa101 ( 627731 )

      Actually, they did, only another of my service providers screwed up my email. Time to initiate a credit card charge-back on VPS.

  • The NSA / CIA team that was running the VPN service / honeypot got reassigned to something more important?

    Just a thought. but if you are planning on using a VPS to protect your online privacy you had better be CERTIAN it isn't run by whomever it is you don't want seeing your traffic.

    • By this shadiness they were probably pretty good. If they're anonymous and you can't go after them for your money chances are nobody else can send legal threats or get court orders out to them either. They might even have a plan to wipe everything when they get in trouble. Win/Win

  • If you’re among those who have been affected by this, we might be able to help you and make you feel better. Contact us and send us your last invoice to price match. We have been in hosting business for more than 20 years and we understand the frustration of hearing this news. Sales@cirrushosting.com

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