Mid-Term 2025 Transparency Report

Hello everyone. At the start of this year we put out our first ever transparency report, with the goal to issue a new one every year. The feedback on our report was really positive, so we want to keep this going every year as planned. However, this year, so much has changed at Kinetic that our 2025 report is already outdated, so we’re issuing a mid-term report to cover the changes. This will be much shorter than our full-year report (Turns out it was longer, I typed this before I had made the full post :D), so if you haven’t yet, I recommend checking out the 2025 report. Alright, so let’s dive into our mid-term 2025 transparency report.

Changes To Packages

For as long as Kinetic has been around we’ve offered 3 package types, Budget, Performance, and Impact. Each with their own RAM options. We did this as, coming from a game server background, we wanted users to be able to have a choice of options to build the server to their needs. Allowing them to pick CPU, RAM, threads, etc. However, on the other side, this meant we had over 50 packages. To help with this we rolled out our package builder. This allowed you to select a version, mods, or modpack and then we would tell you the best package for your needs. The issue with this is it just added even more options into the mix.

Tracking The Issues

If you accept the cookies on our site, this allows us to track how you use our website. We only track what’s going on our site, once you leave our site you also leave the trackers behind. This is normal practice in the industry. With this tracking we can see how people were checking out. Time and time again we would see people flick through the Budget, Performance, and Impact packages, then just leave the site. An overwhelming amount of options would lead to a lack of conversions.

Fixing The Issues

The fix to this issue is to offer fewer packages, but then we run into another issue: cost. See, if we were to lower the number of packages we offer, we either cut packages from the top, so people who need more RAM can’t order anymore, or we cut packages from the bottom, driving up the cost by making people buy RAM they don’t need.

The Solution

So the solution was clear: cut packages from the bottom, but also cut the price. So the high RAM packages cost the same as the lower RAM packages. Allowing us to offer a slimmed down line of packages. Now we had another issue, how the hell do we get the price down?

The SGP Packages

Calling them SGP packages is not really grammatically right, as SGP stands for Simple Game Package, but it just looks better. The idea behind these packages is not only to slim down our package selection but to also offer something that just works.

Our main Performance package is now set to 16GB as standard, while keeping it at a cheap price. This means that you no longer have to hinder your performance to save money. 16GB and 8 threads on a 7950X CPU will basically run anything, any size world, modpack, mods, and even a lot of players. Whatever you want to use your server for, it will just work. Simple.

Getting The Price Down

So we now had our goal, now how to put it into place? Two things we could target right away. Around 70% of all orders had a money off code attached. These ranged from 15% off to 25% off, with most codes being 25% off. As we were already taking a 25% hit on most orders and the cost of this was already factored in, we scrapped the codes and just set the price 25% lower for everyone.

Sales Tax and VAT

Alright, the next one is sales tax and VAT. We’re a UK-based company, but still have to charge EU VAT, US sales tax, etc. The highest tax comes from the EU, with places sitting at 25%. To keep things simple, we just included that 25% in all our prices, no matter where you are. This is common practice in the hosting space. However, if we wanted to get our price down, we needed to do something about this. The website will now add tax based on your region.

Example: The base price for our 16GB Performance plan is $14.99. This would be £11.17 if you flat converted it. However, as the UK has a VAT tax, this is now £13.99. This gets our pricing down by around 50% for some people around the world, but we still need to cut more if we want to hit our low goal.

Not Stripping Features

While we didn’t want to strip features out of the packages, we knew something had to give in order to offer these low prices. For us the least impactful ones were splits and storage.

All our packages up until now had unlimited storage, you hit the cap, you asked for more, you got it. To help push our prices down, the SGP packages now charge for storage. Every package comes with 30GB by default, any extra storage after this is $0.30/GB.

The next were splits. Before we offered 5 splits per package, now it defaults to 2. When looking over our clients, we found that most people didn’t use more than 30GB of storage or more than 2 splits, so this was an easy way to push the income of the new packages, while impacting the least amount of people.

Keeping in mind, if you’re on one of our old packages, this doesn’t apply, you still get 5 splits and unlimited storage. It’s just the SGP packages that don’t.

Managing Servers Better

The next one is how we manage servers. When you don’t interact with, or log in to your server for a prolonged time, we now power it down. We’re playing around with the best time span for this, personally, I think 3 weeks is a good spot. This allows us to free up more space on a node as servers that are powered down. We’ve been playing around with doing this for the past 6 months or so, even on our other packages. It seems to have had no impact on the end user, and we’ve been able to balance our nodes well with it.

The goal here is to not leave system resources wasted. Let’s put this into an example. If we have a 192GB server, in the past this meant we could fit 12 servers on this node. But if 4 of these servers are powered down, we can now allocate another 4 servers to this node.

But here is the issue, what if everyone on that node powers up their server at the same time? We can now move most servers from one node to another, without any impact to them. Same connection address, same files, same hardware, same location. This means that if all 16 people on that node do power up their server, servers are moved to other nodes with space to allow them to all boot freely. This happens before your server is powered on, and you won’t even know it’s happened.

If you own a dedicated IP, your server is a proxy, or a game that isn’t Minecraft, then you won’t be moved. This is due to us not yet being able to move these servers without impacting the end user. As over 80% of our servers at the moment are Minecraft, this is fine for node balance. As our other games grow, we’ll apply new tech to allow these to be moved too. But only if we can ever do it without impacting you.

All nodes are monitored 24/7 by our team. Any node tips over 85% RAM usage, our team is alerted. Same with excessive CPU loads. You can also monitor this yourself at https://stats.kinetichosting.net

Price and Cost Break Down

Okay, so let’s break it down. Like in our 2025 report, we’ll use 1 node as an example for a cost breakdown.

Node Specs
Like last time we’ll be using a Washington D.C. node, this comes with:

• Ryzen 7950X CPU

• 192GB DDR5 Memory

• 1TB NVMe storage

How Much Does This Node Generate
Let’s ignore offline servers for a moment. With 192GB, we can fit 12 servers on this node. This makes $179.88/month. Now this might seem like a shocking downturn from the $527.76/month we showcased in our last report, but let’s keep going.

On average 35%–45% of these servers will be offline. This means around 5 servers will be offline on a node. This brings our total per node up to $254.83/month. Some nodes will be higher, some lower, based on how many servers are online, but this is the average.

Discounts and Affiliate Payouts

In our last report we showed that 35% of our revenue on average was lost to discount codes and affiliate payouts. This would bring the $527.76 reported last time down to $343.04.

After the SGP package rollout we saw overall orders spike by a third. These new orders were not coming via affiliates, but by better conversions from places like Google Search. This, teamed with scrapping our money-off codes, means that 35% has now shrunk down to 6%. Our percentage here is worked out from total revenue lost to affiliates across all payments.

VAT and Sales Tax

Next, we’re no longer losing anything to VAT and sales tax, as it is charged directly to the end customer. We worked this out as an average loss of 12% in our last report. This leaves us at $301.87 with our old packages, and $254.83 with our SGP.

Backup and Additional Services

This has largely stayed the same, but there have been some savings made. It’s now around $5 per node.

Node Costs

Again, there have been some savings here. Last time we said a node would cost us $170/month. While some locations do still cost us that, savings in others bring this average down to $150. That leaves us with $131.87/month for our old packages, and $104.80/month for our new SGP packages.

Other Costs

All other costs remain the same.

Cheaper While Retaining Profit

As you can see, there’s only around $27 difference in profit from our old packages to our new. With a 33% uptick in order volume thanks to the new packages, this means our SGP packages are more profitable while being cheaper.

Better management of our nodes, along with scrapping codes and upping conversions, has meant we can offer you amazing value on your servers.

Additional Costs of Running a Company

With close to 400 nodes in our fleet, you can see how, with scale, the profits, even on what seem like low amounts, can add up. But we do have some extra costs. Like last time, we have spare servers, development servers, external contractors, etc. These have all mostly remained the same over the past 6 months.

The one big change has been staffing.

Staff Team

When we last did our report we had 4 staff members working at Kinetic. As of right now we have 9. Our client base this year has grown a massive amount, we’ve grown our active clients by over 5 times in the past 9 months. With that, we’ve needed to grow our team, both to handle the new client base and to help us keep growing.

We’ve pulled in people who have already worked in the game hosting industry to help us build even more knowledge and understanding.

Support Team

Before, all tickets were managed by the 4 staff members we had, including myself and our CTO. While working on something else, as soon as a ticket came in, we worked on it. It worked surprisingly well. There were some gaps while people slept, but most of the time we had someone online covering tickets, and we managed an average 10-minute response time.

With our client base growing 5x, you would think our ticket volume also did, but it hasn’t. Our ticket volume has only doubled from this time last year, and barely. So why is that? We think it’s mostly due to panel updates. Whenever we kept getting tickets about a set issue, we updated our panel to solve it or help people solve it themself. The biggest help for this was adding our first-time setup at the end of last year. Doing this not only helps customers have a better time, but also means we don’t get swamped with tickets.

That said, we do now have 3 dedicated support agents, these are Nath, Thomas, and Kaitlyn. This helps cover ticket flow, and makes sure someone is online all the time. Our support agents also help us keep modpacks updated and are adding new aricels to our knowledgebase.

Games

You might have seen we’ve added a lot of games to our lineup this year, with even more on the way. This is due to our new Games Manager, Ally. Their role is to integrate games into our panel and make sure they’re always working.

This has led to a load of improvements for already-supported games, and allowed us to massively grow our lineup.

Design and Marketing

We now also have an in-house graphic designer, Matthew, and marketing manager, Cole. Helping us forge our brand and find more people.

With our bigger team we’ve been able to do more: craft an all-new look for our brand, expand our blogs and knowledgebase articles, launch a huge website/blog/knowledgebase update, and also prepare our upcoming Panel 6 update.

Debt and Investment

Kinetic Hosting still has 0 investors and 0 large sums of debt. We’re still as flexible as we were in our last report. Kinetic has also now paid back all director loans (the money I put into the company to help it get started).

Challenges

Our SGP packages have been an amazing push forward, and our client base has grown, but the SGP packages have created one challenge we didn’t really foresee. The issue we’ve found is people find them too cheap. When you compare our $14.99 16GB package to other hosts, you find they’re often selling 3–4GB packages at around that price. So when people see what we’re charging, they feel there must be a catch.

But as we’ve shown here, there isn’t one. The company still makes a profit even with these prices. To help with this, we’ve grown our return window to 7 days from 72 hours. We’re hoping that if people know they have a longer window to get their money back, they’ll trust us a little more.

The next big one is marketing, and it’s why we’re now growing a dedicated team for it. One of the reasons some hosts charge so much for their service is they spend millions on marketing. That’s something we’ll never be able to match if we want to keep our prices low. That’s why we’ve opted for our strong partnership program. So far it’s been fairly effective, but we know it will dry up one day, so the goal of our new marketing team is to push and find outlets to market more cost-effectively.

Completed Projects

As you might have spotted, we now have a fully new website, blog, and knowledgebase. These weren’t planned for this year, but with our brand changes and move from blue to purple, a new site was needed. And while I was there, I massively upgraded our blog and knowledgebase.

We also now have hundreds more articles offering help for more games, not just Minecraft.

On the backend, we’ve made a host of upgrades to our panel, such as a faster backup system and better game swapping.

Due to client growth, we’ve also had to massively upgrade our client backup systems, our new CDN, and overall infrastructure to support the new number of clients.

Future Plans

Panel 6 is still planned for this year and should be dropping in a few months. It’s our biggest panel update ever, with a host of new features: new player manager, modpack imports, new UI, crash helper, and more. No part of the panel is untouched by this new update. Oh, and folder uploads. :D

Panel 7 (our custom billing panel) is also planned for the end of the year. This will roll all billing into one account and allow you to manage everything from within the game panel. We can then retire our current billing panel, which is clunky and rather outdated now.

Final Note

At Kinetic we’re not about making loads of profit, that’s not our goal. Our goal is to make sure our staff are well paid, and that we offer an amazing service to our clients.

Like all companies, we’re always looking for ways to make savings, but not for profit’s sake. We do it so we can pass them onto you. You saw it with our price drop last year, and once again with our SGP packages this year, and I hope we can keep finding ways to lower our price.

Thanks for taking the time to read this. We'll make our next report in March of 2026.

Chris
CEO @ Kinetic Hosting