Proxmox Backup for Hosting Providers

Your hosting customers don't think about backups. Not when they sign up, not when they deploy their first VM, not when they push their app to production. They think about backups at 2 AM on a Saturday when a disk fails or ransomware encrypts everything. By then, it's too late. This post covers how to build backup into your hosting platform using Proxmox Backup Server so that moment never happens to your customers.

Why Backup Is Your Best Upsell

Hosting is a commodity. VPS providers compete on price, specs, and uptime. Margins shrink every year. But backup? Backup is a service hosting providers can actually charge for because customers value it when they understand what's at stake.

The economics are straightforward. Storage costs you a fraction of what customers will pay for "managed backups." A 1TB backup allocation might cost you €2-3/month in raw storage. Charge €8-12/month and you're looking at 70-80% gross margins. No other add-on in your catalog comes close.

There's a retention angle too. A customer with backups tied to your platform is a customer who thinks twice before migrating. Their data history, their restore points, their recovery insurance is all with you. That's not lock-in through friction. That's lock-in through value.

And the alternative is worse for everyone. Customers who don't have backups eventually lose data. They blame you. They leave anyway, but angry. Offering managed backup turns a support nightmare into a revenue stream.

Why Proxmox Backup Server Costs Less Than Veeam

Most backup platforms charge per-agent, per-socket, or per-VM. Veeam's licensing model alone can eat 30-40% of what a small hosting provider charges customers. Acronis follows a similar pattern.

Proxmox Backup Server has no per-seat licensing. The software is open source with optional support subscriptions. Your only costs are storage hardware and compute. As you add customers, your infrastructure cost grows linearly with storage, not with seat counts.

Then there's deduplication. PBS uses chunk-level content-addressable storage. When 50 customers back up Ubuntu 22.04 servers, the OS-level chunks are stored once. In practice, actual disk usage runs 30-50% of the sum of all customer backup sizes. You bill for 10TB of backup capacity but only need 4-5TB of raw storage.

For a deeper breakdown of storage costs, see the cost comparison guide.

PBS Architecture for Hosting Providers

Three ways to build this, depending on your team size and appetite for infrastructure management.

Option 1: Self-Hosted PBS

Run your own Proxmox Backup Server infrastructure. You buy the storage servers, manage the software, handle monitoring and maintenance. Maximum control, maximum margin.

This works well if you already have an infrastructure team and datacenter presence. You need storage servers with sufficient disk capacity, network bandwidth for customer backup traffic, and monitoring to catch failures before customers notice.

Start with the datastore setup guide for initial configuration. Plan for 2-4TB per customer as a starting estimate, then adjust based on actual usage patterns.

Option 2: White-Label Partnership

Use a managed PBS backend and put your brand on it. Your customers see your name, your portal, your support. The infrastructure runs on someone else's hardware.

This is the fastest path to market. No storage servers to buy. No late-night disk replacement pages. You focus on selling and supporting, the backend provider handles uptime.

The trade-off is lower margins compared to self-hosting. But you also skip the capital expenditure, hiring, and operational risk.

The remote-backups.com white-label reseller program is built for exactly this model: dedicated customer datastores, geo-replication, monitoring, and your branding.

Option 3: Hybrid (Local + Offsite)

Run local PBS on your own infrastructure for fast restores. Replicate encrypted to a remote PBS instance for disaster recovery. This gives you two products to sell:

• Standard Backup: Local PBS only. Fast restores, protection against accidental deletion.
• Premium Backup: Local + offsite. Full 3-2-1 strategy with geographic separation.

The local leg is fast because it runs over your internal network. The offsite leg uses PBS sync jobs with --encrypted-only so the remote target never sees unencrypted customer data.

Customer-Facing Integration

Backup Job Automation

When a customer provisions a new server, your automation should create their backup infrastructure automatically:

# Create datastore for new customer
proxmox-backup-manager datastore create customer-4821 \
    --path /mnt/backup-pool/customers/customer-4821 \
    --gc-schedule "Sun 02:00"

# Create user and API token
proxmox-backup-manager user create cust4821@pbs
proxmox-backup-manager user generate-token cust4821@pbs backup-token

# Scope permissions to their datastore only
proxmox-backup-manager acl update /datastore/customer-4821 \
    --auth-id cust4821@pbs!backup-token \
    --role DatastoreBackup
proxmox-backup-manager acl update /datastore/customer-4821 \
    --auth-id cust4821@pbs!backup-token \
    --role DatastoreReader

Wrap this in a script that your provisioning system calls. WHMCS, Blesta, or a custom panel can trigger it via webhook on new order.

Billing Integration

PBS exposes datastore usage through its API. Query it to generate invoice line items automatically.

# Get used space for a customer datastore
curl -s -k \
    -H "Authorization: PBSAPIToken=billing@pbs!metrics:$(cat /etc/pbs-billing-token)" \
    "https://pbs-node:8007/api2/json/admin/datastore/customer-4821/status" \
    | jq '{
        used_bytes: .data.used,
        used_gb: (.data.used / 1073741824 | floor),
        dedup_factor: .data."deduplication-factor"
      }'

Bill per GB used (post-dedup) for usage-based pricing, or per GB allocated for predictable invoicing. Most hosting providers prefer allocated pricing because customers understand it better and it's simpler to bill.

Self-Service Portal

Give customers visibility into their backups without giving them PBS admin access. Options range from simple to full-featured:

• PBS Web UI access with their scoped token. They can see snapshots, trigger restores, and check backup status. Quick to set up, no development needed.
• Custom portal via PBS API. Build backup status, usage graphs, and restore buttons into your existing customer panel. More work, better experience.
• Automated email reports. Weekly summaries of backup status, storage usage, and any missed backups. Low effort, high perceived value.

Multi-Tenant PBS Setup for Customer Isolation

Datastore Isolation

One datastore per customer. Not namespaces within a shared datastore. This is the same architecture MSPs use for multi-tenant backup, and the reasons are identical:

• Garbage collection runs per-datastore. One customer's large backup job won't stall GC for everyone else.
• Offboarding is clean. Delete the datastore, delete the user. No surgical data removal.
• Billing is exact. Each datastore reports its own usage independently.
• Security boundaries are enforced by PBS's permission model, not by convention.

Credential Management

Every customer gets an API token scoped to their datastore. The token format is user@realm!tokenname (e.g., cust4821@pbs!backup-token).

Assign DatastoreBackup and DatastoreReader roles. Never DatastoreAdmin. This means customers can push backups and restore data, but they cannot delete snapshots or modify retention settings.

This is a form of architectural immutability. Proxmox Backup Server doesn't have a built-in immutable snapshot flag. Protection comes from restricting what customer credentials can do. Backups can be created but not deleted by the customer.

Network Considerations

Your customers back up over your internal network if they're on your infrastructure. That's fast and free. For customers on external or colocated hardware, options include:

• WireGuard tunnels. Lightweight, encrypted, easy to automate per customer.
• Direct TLS. PBS uses HTTPS natively. Expose port 8007 with proper firewall rules.
• Dedicated backup VLAN. Isolate backup traffic from production. Prevents backup storms from affecting customer workloads.

If you charge for bandwidth, meter the backup VLAN. Most providers include reasonable backup transfer in the price and only charge for excessive usage.

Selling Backup to Your Customers

Messaging That Works

Don't sell "backup storage." Sell protection. The framing matters.

The strongest conversion comes from bundling. "Our Premium plan includes 200GB of offsite backup" beats "add backup for €X/month" every time. Customers who don't opt in to add-ons will accept features bundled into a tier they already chose.

Pricing Strategies

Three models that work for hosting providers:

Per-server flat rate. €5-15/month per server depending on plan tier. Simple for customers to understand. Works well when server sizes are relatively uniform.

Per-GB tiered pricing. €0.05-0.10/GB/month. Scales with usage. Better for environments with widely varying server sizes. Use the backup storage estimator to help customers predict costs.

Bundled with hosting. Include X GB of backup in each hosting plan. Charge overage fees above the included allocation. Highest adoption rate because customers don't have to make a separate purchase decision.

Handling Objections

"I do my own backups." Good. You should. But where are they stored? If your backups live on the same server or in the same datacenter, a single incident wipes everything. Your offsite backup is the second copy in a 3-2-1-1-0 strategy.

"It's too expensive." What does it cost to rebuild from scratch? A single data loss incident costs more in downtime, lost revenue, and reputation than years of backup fees. Ask any customer who's been through it.

"I'll set it up later." The best time to start backups was when you provisioned the server. The second best time is now. Every day without backups is a day you're gambling.

Getting Started

If Self-Hosting

You need storage servers with enough capacity for your customer base. Start with 10-20TB and scale as customers sign up. The datastore setup guide walks through initial PBS configuration. Plan your storage on ZFS mirrors or RAIDZ for redundancy.

For client-side encryption, decide whether you manage keys (simpler for customers, more liability for you) or customers manage their own (zero-knowledge, but key loss means unrecoverable backups).

If White-Labeling

The white-label reseller program handles infrastructure so you can focus on sales and support. You get dedicated customer datastores, geo-replication across EU datacenters, monitoring, and your branding on the experience. Customers see your company, not ours.

Quick Launch Checklist

Wrapping Up

Backup is high-margin, sticky revenue that differentiates your hosting platform in a crowded market. Proxmox Backup Server removes the licensing costs that kill margins with other backup platforms. Start with manual customer onboarding, prove the model works, then automate as you grow.