Topic: Mining resources hosting/leasing service, worth it? - page 2. (Read 4452 times)

Updated the pricing, lots of Q&A etc. on the 2nd posting.

Feedback is appreciated.

What kind of features you would hope to see from an operation like this?

I have few ideas to lower the pricing to a nicely low fees, yet make it profitable, by driving in some efficiencies of scale.

Payment methods would be Paypal € or BTC.
Also one thing to consider is providing other GPGPU or hashing applications. FPGAs probably cannot operate for anything else than Bitcoin, but GPUs could.

That provider puts money where it matters and not making things fancy, or excessively fine tuned.
Not sure how they handle fire suppression tho.

My point is that there is a balance on things.
I plan to utilize at max 20kW or so at this location, before choosing another one.
That is around 80Ghash/s.
Yes, not a tiny cluster, but not extremely large neither.

The whole point is to make things as economical as possible, not as fancy as possible.
You can have fancy right now, just build your rig into 4U case and take it to a DC, anyone can do it right now. However that does cost 100-200€ per rig a month. If i recall right it's 1100€ a month for rack with 16A @ Evoswitch (NL). Whoops, your operational costs just rose exponentially for: UPS, Fire suppression, 24/7 present staff (150€ per hour remote hands), AC etc etc etc.
Yet you don't get monitoring with it, but you have to monitor it yourself and make requests to DC remote hands, billed in 15min increments. So you need to hire a local guy to do that for you, here in Finland that is 2k €+ a mo for minimum wage guy, but you don't want minimum wage guy doing THAT JOB, riiiiight?

Are you getting where i'm going with this?

There will be a point where all of what you mention WILL be economical, but that day is not Before Launch.

Why most people don't host their hardware in a DC? Because of the cost of all those supplements. For almost every miner out there, it makes absolutely no sense. For some it does, for most it does.

Only reason you are not demanding these from mining contract is perception. Same risks exist for anyone who is having any sizeable mining operation.

1) Complete power cut off, ie. PDUs. Can be automatic with temperature sensors -> detect over 50C in any of the measure points -> something is seriously wrong.

2) Like i said, 24/7 video surveillance, tight lockdown. A non-issue.

3) 30mins is my normal from door to door travel time, i can make it in 20minutes in emergency. or less.
I'm a entrepreneur -> this WOULD BE my job, at least part of it. I can leave and come whenever i want, no problem at all. My responsibilities are 100% to customers.
3AM, 10AM, 5PM, whatever, nothing new. If sprinklers go off fire alarm is set off automatically, which goes remotely to fire station.

Actually, i'm quite curious how ridiculously tight requirements you are asking for bitcoin mining rigs, these are not mission critical financial servers, these are mining rigs. No one is going to die if they are down for a while, no one is going to go bankrupt, no one is going to have relatively high losses vs. time of downtime, no one is going to take PR damage (except me) for any downtime.

All of that asked can be provided, but price will then correlate:
That would be 7500€ per 7970 per year, thank you.
That will give you a fully HA setup, in 24/7 in location presence, with proper fire management, offsite backups, security guards on post 24/7. Minimum order is 50 units, minimum contract 3years.

Ask for enterprise level features -> get enterprise pricing.

Or is it sufficient for a bitcoin mining rig to have an annual 99.9% uptime (less than 9hrs downtime annually), where security for the budget far exceeds the expected norm, and any and all issues are replied & acted upon within the day, critical emergencies within an hour or two, at a sane cost.

99.9% of the dedicated server market does not offer what you are asking for.
Some providers run their DCs completely lights-out with hours to travel to location if need be. They still offer you 99.9% SLA, and many people use their services for something which would cost them with 1hr downtime more than annual revenue of 1Ghash/s of mining rigs.

Hell, i've seen (and used) DCs where ambient temp is 50C, with no fire suppression available, and anyone with knowledge it is there and intent could get into. Actually because one of the technicians forgot his keys, with 20minute effort we got through the door without any kind of keys. I admit, that place sucked MAJORLY.

BTW, worlds most successful server provider uses the quality level of DCs 90%+ "enterprise hosting" folks would laugh at. Yet their uptime levels at the very least is on par, usually exceeding this "enterprise" offers (disclosure: I have hundreds of servers there, which take less time to manage than just 10 servers at Leaseweb...)

oh and this warehouse, i already got there stuff worth tens of thousands of euros, if the place would be robbed or would burn down i would stand A LOT to loose.

You can shut off remotely, but can you respond fast enough so the equipment doesn't get wet while the power is still on? Keep in mind you need to cut off all power, because even if the rigs are "off", the power supply is still providing standby power to the motherboard. Or are you going to have it set up so all power is cut automatically in an event of a fire?

It's not just reacting to fire, you need to be close so you can monitor the site 24/7. It's a datacenter with over 50k worth of electronics, so burglary/vandalism is definitely an issue. A warehouse with tons of ventilation, spewing out hot exhaust is sure going to attract some attention.

Just because you live 30 minute away, doesn't mean you can deal with an emergency. Are you willing to leave work if a problem shows up? How about 3am in the morning, or right when you're eating dinner? Mining rigs are very risky investments, and bitcoin prices are very unstable, so it's all about getting the fastest ROI as possible. If it will take you 12 hours to respond to an event, your customers are not going to be happy.

A much better idea would be to sell mining contracts.

servers don't need that kind of observation - properly configured these do neither.
a 5k server room might go by months no one even visiting there!

If fire happens, i will most likely be able to shut down all nodes remotely, so when the sprinklers go off the hardware would be spared, just need to dry and test everything. Just in case i can't be there when the fire is starting up.

Seriously tho, computer hardware does not tend to catch up on fire spontaneously

and if this grows sufficiently, it's not that big of an investment relatively to setup electronics safe fire system (can't remember the name of the gas used).
If you got 40k € (ie. 100x7970) operating, 4k-8k € on a small fire supression system is not that bad of an investment anymore (10-20%) compared to a small 10x7970 operation.

That is exactly what I meant. If I was doing this sort of thing I would make sure to be there physically myself or leave someone there at all times to watch over the rigs. Even 30 minutes is a long time. A fire can start at any time and the sprinklers would destroy all the hardware I think. Maybe insurance could help.

Anyway feel free to carry on. I was just suggesting a feature you might consider adding for your customers. I certainly would not put my rigs anywhere without constant supervision by a person that lives at most 5 minutes away etc.

Not sure of your question. Do you mean a person available to goto the location 24/7? Well the 2nd location is just 22km from where i live - So yes Takes 30mins for me to drive there, and i do hang around there for other reasons once or twice a week when i can.
It functions as our warehouse, plus i assemble stuff there etc.

No matter what, i will be placing my own rigs there. Only thing scares me is the temperatures in end of July, early August.

Average summer temperature is just ~18C for past few years (VERY HOT relatively), 1971-2000 average summer temp 15.9C, 30km south of the location.

I would actually consider setting up something like this if it wasn't for the shipping costs, handling costs, maintenance needed etc.

Definitely need to have a dedicated person there 24/7 in case something goes wrong with so many miners and HW at your disposal etc. 

Do you have this OP ? 

A correction my electrical rate isn't 6 cents.  I was just saying I would colocate my mining hardware to your location if you could offer 6 cent electrical rates (plus some rent for cage space).

What competitors? I don't know of any in siberia.

electricity is still 50% less than yours. Mining doesn't require a fast connection, a dial-up line will probably work just fine. All you're doing is spreading FUD about your competitors.

I really don't, but i don't sleep, and i work 16hr days so ...
Many of the topics has been on my mind for a longer time.

I guess i'm just busy person, even tho i consider myself lazy! XD

Thing is, i enjoy doing research, doing new things, so the 16hrs a day spent doesn't feel like that bad, usually. Having employees helps aswell

BTW, did some cost analysis and the pricing is still ALL wrong on the table.
First year is the toughest, need ASAP HW ROI to supply to new customers, but with pricing making that possible it's not attractive, and self funding lasts only so far.
We have only secured funding for 4-6 units (BFL, Icarus/X6500 or 7970s) a month with 0 revenue for this endeavour.

My measurement period is 1year. With traditional hosting, with less risk i can achieve less than 1year HW ROI, this being riskier tho ... But GPUs are easier resale than servers. After 1st year i can probably get almost same price for GPUs than what i paid them for so ... For them i might lower the 1st year cost to something like 50% retail card price + operational costs. This would be 1st year competitive even for DaT!

Plus this doesn't require acquiring new locations etc. and there is always the backup that unused hardware can be mining for myself. And there is some other options i'm looking forward to investigate for additional revenue on this!

You sound like you have a lot of time on your hands to run this venture, and that's cool. Even discussing making your own UPSs. I wish I had that much time to play with hardware 

Updated the pricing again, fixed some flaws in the method of calculation. Still badly flawed tho!
Calculating hosting prices is not an easy task for something you don't have comparison base to, and most cost is in the HW, and HW lifetime.
Obviously paying setup + subscribing for an year might not make any sense at all.

"Submit your own HW" is possible too, and pricing would be something like:
75€ setup on any GPU (To cover PSU, Mobo, cooling etc.!)
BFL Single: 11€
Icarus/X6500: 5€
Z-Tex: 4€ (Obviously too low if you need support even once)
7970: 23€
6770: 14€
5830: 24€

for FPGA i would also need to setup casing etc.
No HW Insurance/Replacements included, if it fails we'd ship the GPU/FPGA back to you, and you can ship us an replacement or fix it. Only disaster insurance covered as per our insurance company.
Some simple things tho we can do for you, ie. swap GPU cooler or apply new thermal paste.

Wow that is one mighty low electrical rate!

So your 1st year cost for 7970 with assumed 150W with overheads and GPU cost of 530$ is about: 608$! 467€ ... Wow. That is amazing!
My electricity cost alone is 170€ / 221$. And they say Finland is the promised country of Cloud ....

In your case you would however benefit from less hassle, but that's it.

I intend to spend a lot of extra effort on enhancing Mhash/W ratio, and find my competitive edge on electricity pricing there
That means going as far as minizing quantity of fans, replacing all fans with larger, higher efficiency ones.
During winter, all but GPU fans would be disabled too, and i expect GPU fans to be running real slow.
Problem really is that need to make sure the ambient stays above 4C (Yes, i AM serious). First winter i expect some sleepless nights at the farm measuring temperatures.
One solution is to use tons of electronics varnish, and simply let the ambient to go -20C but i'm not a fan of that idea.

That can easily save 10-20W per 3-4GPUs from fans alone. Low ambient will help shave off another couple W per GPU.
Increased spacing will help too.

Undervolt, underclock the CPUs & RAM, find smallest ram sizes available etc.
Test and benchmark the sweet spot of Mhash VS. W per type of GPU.

I'm actually expecting to achieve a total efficiency of more than 4Mhash/W with GPUs on the newer gear!
But only research will show will that be achieved.

I also have an idea to decrease the overhead per GPU down to around 9W @ wall

So? How many Siberians you know even being able to do this?
Even tho that is the case, for example google setup one huge DC here ...
France has high electricity costs, yet probably the biggest hosting company in Europe operates from France ...
Netherlands has likely the highest electricity costs in Europe, yet is the Europes "Internet Hub" meaning best connectivity there, and LOTS and LOTS and LOTS of large and small hosting companies, one of europes largest providers too is there.

Just because Siberians can get that, does not mean it will happen.
For example, they might have very flaky electricity, hard to get HW delivered, too big distances, if electricity goes down it might be down for how many weeks??
How about internet connectivity? Satellite? yeah....

Anything hosting requires reliable power and reliable connectivity, and distances seem to have an indirect relation (length of power, copper, fiber lines)

Tho, if they have none of those downsides.... Well, it's russia and has it's own cultural phenomenons.

And no i don't need to be able to sell to 100% of world population, no business would ever start if they'd expect to offers to be lucrative for 100% of world population.

Then #3 is really your only real issue.  Electricity is the one variable that defines marginal miners and profitable ones. 

Still it may be viable.  People who have higher electrical costs and/or lack the skill, spaces, resources may find it desirable.

Bad luck of the (electrical) draw.  If you had everything the same and operated in Wyoming with <6 cent electrical rates I might ship all my equipment to you and rent a cage.

but still, Siberians can get sub 8 cent AND have cold climate.