WTF! A guy is ruining my business!

xicebreaker69x said:

people are always looking to pay less for the same service.. its business. unless you take charge and run him out of business comparing with his rates you will not last

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If he just lowers prices, then the other guy will just follow suit.
The way to win this, is by adding MORE value and providing a better service.

Screw that guy. My advice work on you negotiation skills. Get those clients back and get more. Get out there and set yourself apart from what the others can do. 90% of this is plain simple physiology and the mentality of a customer thinking they're getting a great service for the price that they pay. Usually undercutting will win the stakes easily. BUT, you CAN and WILL get those customers back. Simply ask them what you did wrong and why the sudden change of heart besides the price. After that show them the great reviews you've gotten and how much better your service is even though it's more expensive. Assimilate them into getting into the mindset of "You pay what you get" and that way you can try to get them back. Don't worry man, this is the sport. The fittest of the pack survive. You've just been removed from the alphamale, time to regain your position again.
Hope that helps,
BA,

Clients leave all the time and in your case they pretty much told you that your service and/or the relationship is not worth $50 a month. Sounds like you need to reevaluate your offering and get it updated with something that is a better value for the price.

Or, move on to bigger fish as many have suggested. There are many, many companies out there that are willing to pay for Web services. Position yourself as a expert and you get expert $$$. Leave the low hanging fruit that doesn't want to pay to those that want to deal with their headaches.