Dreamhost Is "Very Very Sorry" For $7.5 Million Billing Error

Dreamhost would like you to know that its very very sorry for accidentally billing its customers $7.5 million it wasn’t actually owed. You see, someone typed 2008 when they really meant 2007 and their billing system decided to charge all of their customers in advance for the entire 2008 calendar year. This included debiting huge amounts of money from people’s checking accounts and all the “worst possible scenario” situations you could possibly imagine.

Tom, friend of the blog, and master of the internet, was among those affected:

Well, this morning I got a billing email from them:

This is just a notice that your DreamHost [redacted] (“zug’s Account”) has a balance of $380.87 (including any charges not due until 2009-01-14), with $340.97 due (since 2008-12-14).

You also have $321.02 past due (owed since 2008-11-14), and if by 2009-01-14 you do not pay at least the $321.02 part, your account will be automatically suspended until payment is received.

Ok, that’s confusing… WTF, I ask myself. Looking farther into things…


We have the last payment on this account to be $12.46 on 2008-01-15 06:48:38.

Since then the following charges have been made to the account:

2008-01-18 – $19.95 for “CODE MONSTER!” through 2008-02-17.

2008-01-18 – $19.95 for “CODE MONSTER!” through 2008-02-17.

2008-02-18 – $19.95 for “CODE MONSTER!” through 2008-03-17.

2008-02-18 – $19.95 for “CODE MONSTER!” through 2008-03-17…..

It turns out that Dreamhost is really, really sorry.

From Dreamhost’s blog:

I’m very very sorry, we’re very very sorry, and I’m sure you’re very very sorry this happened. I really am. I understand the sort of problems that an unexpected large charge to your credit card (or worse yet, your debit card) can cause. If the tone of this blog post seemed a little light, I apologize I don’t mean to offend and I realize how serious an issue this is. I’ve been up since 3:50am trying to undo the damage and maybe I’m a little shell-shocked.

A new service is running right now (in parallel on all the controllers) that fixes all those future charges, re-enables your account if it was erroneously suspended, and if your credit card was automatically rebilled, refunds the payment automatically. You don’t have to contact us or your bank, and you’ll get an email when your account is finished fixing up. It’s going to take several more hours to complete. There are (or were, after this incident) a lot of you these days!

If, because of this billing mistake, you somehow incurred some fees from your bank or credit card company, please let us know after tomorrow (today we are just replying to all 10,000+ billing messages with a generic explanation) and we’ll do our best to make it right for you.

As Tom points out, an apology is probably small consolation for people whose mortgage payments bounced because of this bug. We wish Dreamhost the best of luck compensating their users.

Dreamhost fucks up bigtime! [ScatteredGenius]
Um, Whoops. [Dreamhost Blog]
Billing Issues (846 comments) [Dreamhost Status]