(Update: An earlier version of this article incorrectly attributed that new charges would be charged to end-user traders when in fact they were being passed onto the VPS Providers.
We have also added a link to CNS’s response at the end of this article)
Earlier today, Forex Magnates reported about a letter to VPS clients issued by hosting provider, Commercial Network Services’ (CNS) CEO, Bary Barhami. In the letter, CNS took issue with charges that PrimeXM announced it would charge its VPS hosting partners new monthly fees, which they would need to absorb or pass on to their end-user traders. According to CNS, PrimeXM was allowed access to host clients on CNS’s ON NET network which provides traders near zero latency with their brokers. At issue was whether it was unfair for PrimeXM to charge additional fees when the technology provider was being offered solutions for free from CNS.
Replying to the claims of unfair charges, George Swann of PrimeXM issued a statement on behalf of his firm in response to Mr. Barhami.
While PrimeXM has continued investing heavily in upgrading its hosting and network offering by increasing its capacity and by continuing building network and infrasturcture redundancy, the PrimeXM hosting business has been supported and financed by PrimeXM’s technology business.
Over the last six months and after a careful assessment of our hosting business, we determined that the relationship with the VPS hosting providers cross connected to PrimeXM‘s network was not equitable to PrimeXM. We think that it is unfair for PrimeXM to be subsidizing the VPS hosting providers business. The cross connect peering to PrimeXM’s network infrastructure was offered free of any charge.
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The statement added that PrimeXM had contacted its VPS providers informing them of the new fee of $2,000/mo , which would begin to be charged in July, starting at a gradual rate of $1,000 for the first three months. The letter continued that the fee is similar to policies at other technology providers and most of their VPS host partners had agreed to the payment.
They added that Mr. Barhami refused to pay as well as requested payment for connectivity fees. PrimeXM’s CEO, Clive Diethelm, contacted CNS to resolve the matter, however according to PrimeXM, Mr. Barhami refused to work with them on an agreement.
The letter ended with PrimeXM stating, “PrimeXM will work with its customers and recommend alternative VPS hosting providers which have now been established as our partners.”
While not an issue that affects the vast majority of retail client, VPS solutions are an important item for what is a key segment for brokers; large-sized active traders. Using VPS services, traders can host their automated strategies to operate without interruptions 24 hours a day. Among trading forums, CNS along with Beeks VPS is known to have one of the better solutions, especially for brokers on the ON NET network which provides traders VPS hosting at the same location as their broker’s servers. Mr. Barhami is also an active participant in forums offering hosting advice and product support.
In response to PrimeXM’s article, Mr. Barhami reached out to Forex Magnates and provided us with a link to his firm’s reply. Read it here