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DreamHost's $7.5M billing accident: "Um, Whoops."

Train WreckIf you were a large company that subsists on customers paying monthly or yearly subscription fees, what's the worst possible thing you could do? While a number of things come to mind, automatically billing customers for a year in advance by mistake has to come in at the top. Now, how about when you're a hosting company that has a reputation for being a little too casual, a little bit unprofessional?

Yikes.

Today is not a good day for DreamHost.

Last night a mistake was made that caused virtually every single DreamHost customer to be billed for a full year of hosting up until December 2008. This caused automated charges to be processed against these customer's credit card or other accounts from a few hundred dollars, to literally thousands of dollars. By their own admission, this was a $7.5M mistake. Seven and a half million dollars.

Calling that a mistake is an understatement. The right term starts with the word "cluster" and ends with something that's not printable here.

Given that DreamHost has a bit of a PR issue in that their cool and casual reputation is starting to look a little juvenile and irresponsible, how would you expect them to respond? Probably not with "Um, whoops," but that's exactly what they responded with.

Double Yikes.

DreamHost, it's time to grow up. The cool kid or class clown loses his charm when it becomes clear he's just a screwup.

Tags: billing, billing-mistake, DreamHost, hosting, news, shared-hosting

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