Choose your service providers carefully

By ian

Many people have already heard about the current payment nightmare at Dreamhost. Essentially, somebody made a mistake and charged Dreamhosts’ customers for 12 months of service at once. Not a few customers, all customers, including me. All in all, the overcharge is between 7.5 and 9 million dollars.

This has become quite a nightmare for DreamHost for a few reasons. First of all, many of us weren’t very happy to getting a huge overcharge and seeing a image of Homer Simpson as the official response. This not only made Dreamhost look unprofessional, it’s caused a divide amongst their users which is making the problem worse.

Most of the users with $5.95 a month plans are laughing. Those with $395.00 per month plans aren’t. The comments for the Dreamhost blogs have become little more than a flame war between the cheap hosting customers and the enterprise guys. Unfortunately for Dreamhost, the cheap guys are laughing and the expensive guys are getting even more pissed. Not exactly a good situation.

Aside from the poor PR choices, the biggest problem has actually become DreamHosts payment service. Not only did the service accept the $7,500,000 in charges without question, they are apparently having a really tough time issuing refunds. In fact, according to the Dreamhost blog, only 1/16th of their customers have been refunded. This is made even worse by the fact that 3/16ths of their customers weren’t charged, but were refunded. I’m in the got charged a bunch and hasn’t seen a refund group.

The offical salt in the wounds move was made by the DreamHost “Billing team leader”. Many people, myself included, have recieved responses that the support staff can’t even research any refund issues at the moment because this guys isn’t around. Apparently he should be back on Monday. I don’t know about you, but if my job and company were on the line, I might want to put in a little overtime.

Overall, this was a mistake that would have been minor if DreamHost’s payment processor had issued refunds correctly. Now DreamHost is in a potentially company ending state and I’m not looking forward to moving servers again. Hopefully they can pull themselves together and get this taken care of.