As for the premium, Gigamining sold at a 100% premium to the cost of the equipment so 81% seems a bit low.
OTOH,
- Gigamining was fully insured against any equipment defects or other problems, 5Mh no matter what. Terramining doesn't seem to be (maybe I've not read all this carefully enough).
- Gigamining was (advertised as) perpetual.
- Gigamining was a BTC deal, not a fiat deal, which is what Terramining is (cleverly disguised as this fact may be).
- (most importantly) GLBSE-era nonsense & silliness is over.
As revised, this is a simple "dedicated server" deal, available from pretty much any datacenter/ISP: you pay us 100% mark-up on equipment for a year, we provide connectivity, power, cooling and floor space. The principal difference is that the end product of servers (mostly web presence) is not really commodified, whereas the end product of mining rigs (hashes, obviously) is. (And unabashedly so. In fact hashes are the very definition of a commodity, or at any rate the one thing so far created in this world that comes closest to that theoretical notion.)
As far as hosting goes there's some incentive for a thin midmarket sliver to pay for this type of deal, but the bulk of that market is either buying shared servers (which is what "cloud" is, ftr) or colocating their own equipment. The economic rationale for someone buying into something like this eludes me: if they just want a few hashes they can buy a few hashes on gpumax' successors, if they actually want to mine competitively they can buy the gear themselves. Unlike the use of a car, a vacation cottage or an airplane, which are things people may want for themselves, a lot of hashes are intrinsically about as appealing as a large pile of potatoes or bearing balls.
Obviously the absence of a credit card payment method is easily explained by the operator's desire for discreetly outsourcing all the BTC exchange risk upon "investors", but with all the talk of NDAs and whatnot I fail to see why anyone on the buying side would forego the use of a payment method which'd allow the safety of easy chargeback three months down the road if (when?) the deal doesn't play out as projected. This combination of fiat contracts and BTC payments piles things a little too much on one side.
As to the earnings projections offered: I don't think those presented - or any other such copy for that matter - hold any water whatever. In the words of Buffett (a noted manager of commodified businesses),
So, for example, if you have 1000 Gigamining contracts the paid upgrade path would cost 1000 x 0.29 = 290 BTC or about $3,900
Personally, I plan to spring for the paid upgrade path as I believe it will most likely be very profitable.
I'll bet you 100 BTC that by the end of this year you will not have received 290 BTC from this investment through the ordinary distributions.
In case anyone's wondering, this isn't an impeachment of James Gibson personally. The case is simply that antiquated (that is to say, fiat) arrangements do not work for Bitcoin.
This isn't through some fault of whoever is trying to implement them, although frustration has occasionally led people on this forum and off to call him a scammer and so forth.
This is simply because fiat is too shitty to work. Giga finds himself in the unenviable position of trying to deliver pizza in present day New York through the services of an old, horse drawn buggy.
It's great that someone is trying (in the sense it's great someone's trying to prove you can't grow taller by pulling your own ears) but the blindness of frustration mentioned afore also guarantees it's suicide.
