Rage4 "Prey-as-you-go" extortioncast DNS business model

[staticsafe]

Nice

add 2 factor authentication login support that links to a registered mobile number and also do push notifications to mobile at preset threshold percentages too

They already support two factor authentication using TOTP.

 

[texteditor]

Howdy

First of all as stated in LET thread the DNS is just one part of our business. @texteditor please read whole thread (and previous ones [like this http://lowendtalk.com/discussion/10223/unprofessional-business-clients-partners#latest]) and you will see that:

1. "We do not chase small amounts (like 2-3€), I agree that's not worth. But 10-15 customers with unpaid 50€ and more gives you significant amount of money worth taking care of."

2. "It's sad that we need to chase people (including few LET users) for few Euro." was sai partialy in context of this and my previous thread (see #1).

Why aren't you shutting off small debtors before they become big debtors instead of complaining about them and giving them the freedom to rack up more debt?

3. Fact: 99.5% of our profit comes from flat fee based business accounts,

4. Fact: beside DNS we operate 2 more services and run software house

I'm willing to bet !00% of the people who "owe" you money have never paid you a dime before, you just refuse to take a stance past going directly to debt collectors after you let the issue worsen.

5. Fact: most of the business use collection agancies on certain point - I was just looking for suggestions as our current one is not the best

Most businesses that do also check credit reports beforehand and give positive reports back to credit bureaus for good cusomers - you however do no checks but still are opting to use collection agencies (which can negatively hurt one's credit) to go after debtors whose information you do not verify.

6. Fact: that's true that we do not block the users after they exceed the free usage tier and it's 100% by design. The DNS is most crucial part of Internet ecosystem and it must be up and running

I get this, but if this is your plan you should probably rethink it rather than publicly complaining and then doing nothing after they owe you 2 euros, then again when they owe you 3 euros, then again when some owe you 50 euros.

7. "Doing "Freemium" without cutting off heavy free users or asking for a billing method up-front (like AWS) and then going to collection agencies is just shameful though" - I've exaplained why we haven't introduced the creadit card support (it's just to expensive as most of the payment and micro ones). I never said that we plan to go straight to collection agancies so please just stop.

This is your choice, but you can't go to collections and put someone at risk of credit ratings damage or dealing with repo men because of the structure of your freemium service.

8. @texteditor I'm not sure how old are you but there is no need to be rude "because @gbshouse is a fucking moron". It's enough to ask why do we stick to this business model and what our numbers are.

Multiple people pointed out all the apparent flaws last time you complained about many LET-ers owing 2-3 euros each in February, and instead of fixing the business model or at least cutting off the serious offenders, you opted to let them rack up tens of Euros in debt to you, and now are planning to go to collections.

 

[texteditor]

If I racked up 100 euros in debt on this account, would you go to debt collectors after I didn't respond to your emails? Literally none of this is verified. Feel free to unfairly knock down someone's credit score because you can't be bothered to make some necessary concessions in your business model

 

[Aldryic C'boas]

I thought you were quoting mtwisatool at first - had to double take and re-read the names.

 

[DomainBop]

If I racked up 100 euros in debt on this account, would you go to debt collectors after I didn't respond to your emails? Literally none of this is verified. Feel free to unfairly knock down someone's credit score because you can't be bothered to make some necessary concessions in your business model

The potential liability created by the failure to verify account information far outweighs the amount you could realistically hope to recover if you turned the accounts over to collections.  I'd implement a verification system before I even thought of going the collections route, and then only submit accounts that had been verified.

 

[wlanboy]

Pay-as-you-go models only work if you can set a cost break.

Even Microsoft offers this on Azure services.

 

[gbshouse]

@texteditor - I'm trying to understand what's your problem

Do you have and proof that we chase people for 2-3€? You've made a drama using partial information from one of the threads on LET.

If you do not like our business model do not us our service or invest your time and money and start your own DNS service.

With every number of customers there some small percent of them which will use fake data or try to cheat, and honestly there is nothing we can do only accept it. If you check rage4.com domain registration date you will see that we are pretty mature company and we can analyze business risk etc. As stated earlier we will introduce some additional notifications about usage etc. (our DNS service was built with community and for community and we listen to you) as we prefer to keep thing up and running instead puting specific domain down.

@texteditor - I would expect public apologize for calling me "moron" and suggestion that we do extortions or similar stuff. As I said do not make drama, if you have any concerns feel free to discuss it in civilized way.

 

[texteditor]

I'll gladly give an apology if you can give reasonable answers to questions I've already noted in this thread:

1. What percentage of these non-payers have any payment history at all with you?

2. How do you plan on confirming you were given valid information about your customer when you do not have any kind of payment history from them?

3. Are you aware of the consequences that negative changes to a person's credit score, truthfully or falsely created by a debt-holder, can have on said person in the US?

Your terms of service, billing style, lack of opt-in/opt-out for allowing users to limit themselves to their free queries, and lack of effort towards verifying user information and payment information means that your TOS is wildly unenforceable in the US (and likely most of the other countries your debtors are in, I presume) and you would never, ever stand a chance a of recuperating any of this lost "income" in a small claims court. Going to debt collectors instead, who outside of a few select companies doing large-scale contract work for Fortune 500 companies tend to be shady assholes who do things of questionable legality just to get their commission is somewhere between an ignorant and unethical at best, and illegal, malicious, and greedy at worst.

Personally, I think you are running a great service, but your your handling of and approach to "the business side" has me convinced that you are either a moron or a very greedy person wanting to do illegal things to make a little extra money - I chose to assume you were the former and were simply unaware of the legal unenforceability of your TOS & service implementation, the reality of how "ethical" most debt collection agencies are, and how much credit reporting works in the US.

If you can reasonably answer those questions, or failing that prove that you wouldn't get laughed out of a venue like a small claims court or civil court where your TOS would have to stand up against actual contract law, I will gladly rescind my insult and accusations, apologize, and replace all my posts on the matter with public apologies.

 

[Aldryic C'boas]

With every number of customers there some small percent of them which will use fake data or try to cheat, and honestly there is nothing we can do only accept it.

You do realize that without verifying someone's ID, you could be screwing over an innocent person that never actually had service with you when you try to sell the debt to a creditor?

 

[splitice]

Atleast in Australia Debt Collectors are required by law to have identifying documents. This is usually a signed contract (sometimes digital signature) or in the case of large companies I have seen credit card details used as ID (had dealings with Debt collectors when Origin Energy "lost" a bill and forgot to send its subsequent reminders). 

 

[gbshouse]

@texteditor - to answer your questions

1. What percentage of these non-payers have any payment history at all with you?

I assume that you are talking about those 10 users which we are "chasing" right now: each of them have at least one month of correct payment history

2. How do you plan on confirming you were given valid information about your customer when you do not have any kind of payment history from them?

We have requested and recived the details from their registrar, we have profile change history and the list of IPs used during registration and logging in to our control panel. We have passed those information to authorities which are working on this issue and they've confirmed the names

3. Are you aware of the consequences that negative changes to a person's credit score, truthfully or falsely created by a debt-holder, can have on said person in the US?

Yes, of course, and we are aware of potential problems which can be related to false information.

Please note one thing: with regular users which have unpaid invoice we always send at least 3 payment reminders, next our finance team is trying to find alternative emails (very often people use dedicated email addresses for DNS purposes which are rarely checked), phone contact or even social media such as FB or Tweeter. If that fails we send information that domain(s) present on the invoice will be removed from our system within 2-3 days. If the invoice amount is significant we try to contact the person next month.

I hope you will be satisfied with those answers.

 

[AThomasHowe]

That is a lot more sensible than originally made out, yes. I still think you'd save both your users and yourselves a headache though by capping free accounts once they pass the 250k limit, at least for those with unverified payment information. You could even have a switch under payments, "Add credit from this source when I go over my credit balance" or something.

I know at least the clients you say you're talking about here are people abusing your service but I probably wouldn't feel happy paying 50 EUR in overages on an otherwise free service if I was targeted in an attack or something. $10 to someone else could easily cost your clients magnitudes over that in overage charges.

It's not surprising that a low-end priced service pisses people off when they're charged money they're not expecting. 

 

[texteditor]

@texteditor - to answer your questions

1. What percentage of these non-payers have any payment history at all with you?

I assume that you are talking about those 10 users which we are "chasing" right now: each of them have at least one month of correct payment history

2. How do you plan on confirming you were given valid information about your customer when you do not have any kind of payment history from them?

We have requested and recived the details from their registrar, we have profile change history and the list of IPs used during registration and logging in to our control panel. We have passed those information to authorities which are working on this issue and they've confirmed the names

3. Are you aware of the consequences that negative changes to a person's credit score, truthfully or falsely created by a debt-holder, can have on said person in the US?

Yes, of course, and we are aware of potential problems which can be related to false information.

Please note one thing: with regular users which have unpaid invoice we always send at least 3 payment reminders, next our finance team is trying to find alternative emails (very often people use dedicated email addresses for DNS purposes which are rarely checked), phone contact or even social media such as FB or Tweeter. If that fails we send information that domain(s) present on the invoice will be removed from our system within 2-3 days. If the invoice amount is significant we try to contact the person next month.

I hope you will be satisfied with those answers.

This is much more sensible than all your previous posts on the matter have made your policy out to be.

I'm sorry for calling you a moron, given that we now know the pursued all have verified information via payment history cross-checked with other contact info. I see nothing unethical about pursuing payments from these users instead of the LET freemium excessive users you've complained about several times before.

That said, given what I've noted above about the faults in the TOS, and the fact that these are b6y your admission two-digit to three-digit dollar amounts we are talking about, there is very little chance that any debt collectors short of the high-commission small outfits that engage in questionably legal tactics will even be interested. Realistically, you are still looking at a very small payout combined with a high chance of getting yourself into legal trouble and bad publicity.

It is your call at the end of the day, but sometimes it's better to cut your losses than get a little revenge.

That is a lot more sensible than originally made out, yes. I still think you'd save both your users and yourselves a headache though by capping free accounts once they pass the 250k limit, at least for those with unverified payment information. You could even have a switch under payments, "Add credit from this source when I go over my credit balance" or something.

I know at least the clients you say you're talking about here are people abusing your service but I probably wouldn't feel happy paying 50 EUR in overages on an otherwise free service if I was targeted in an attack or something. $10 to someone else could easily cost your clients magnitudes over that in overage charges.

It's not surprising that a low-end priced service pisses people off when they're charged money they're not expecting.

I agree completely, and I still think he's playing a dangerous game

 

[gbshouse]

@texteditor - "LET freemium excessive users you've complained about several times before." - if I do it on LET I do it by purpose, there are few individuals which play a little game with me personally (like my post on LET in May 2013 which was targeted to "one of LET well known providers").

@AThomasHowe - as stated earlier we are going to add few new features which will improve the usage awareness

 

[drmike]

Solution = fixed rate ranges.  (i.e. 0-250k free, 250-2 million = $__,   2-10 million = $___, etc.)

Require a payment deposit / credit from everyone. Otherwise if you DO NOT, where they exceed 250k in a month, then your DNS shuts off.

Pay as you go for random quantities that can per se be audited at all will end in horror with a big enough subset of customers.

 

[Kruno]

We have requested and recived the details from their registrar, we have profile change history and the list of IPs used during registration and logging in to our control panel. We have passed those information to authorities which are working on this issue and they've confirmed the names

Now that is quite serious. Domain registrar gave you personal details without a court order, and then authorities(what country?) confirmed the names for you. They had to match clients vs IPs from their ISPs. And all that took place without a court order? Because I'm pretty sure nobody in Europe would issue a court order over a few eur or 50eur.  

Who is domain registrar in question, just so I can make sure to never use them?

 

[Dylan]

^

Good point: that is a shocking and most likely illegal breach of privacy. I'm wondering about the country and registrar as well.

 

[fm7]

So is it just that people want affordable anycast?


Francisco

HP Cloud DNS - 75+ edge locations using Anycast (service provided by Akamai).

$0.35 per domain per month. $0.55 per million queries/month for the first billion queries (the query prices are prorated. e.g. domain with 1.1 million queries would be charged $0.605 cents).

http://www.hpcloud.com/products-services/dns

 

[wlanboy]

^

Good point: that is a shocking and most likely illegal breach of privacy. I'm wondering about the country and registrar as well.

Me too - he should stop talking...

Which registrar would return private whois information on the behalf of "he/she owes me 5 bucks"?

HP Cloud DNS - 75+ edge locations using Anycast (service provided by Akamai).

$0.35 per domain per month. $0.55 per million queries/month for the first billion queries (the query prices are prorated. e.g. domain with 1.1 million queries would be charged $0.605 cents).

http://www.hpcloud.com/products-services/dns

Good finding.