Feb 1, 2002 : The webhost industry: week review

📅 February 1, 2002 - It seems like not a week goes by recently in the Web hosting industry without a merger, acquisition or bankruptcy that seriously alters the landscape of the business.

Last week, CyberGate and Affinity announced they had merged, creating yet another hosting behemoth.
This week, another firm bit the dust. This time, however, it was a bankruptcy related to connectivity instead of hosting.
Telecommunications firm Global Crossing Ltd. said Monday it had filed for Chapter 11 bankruptcy protection in order to re-organize its finances.
The filing, which applies only to certain affiliates of the company, was a result of a heavy debt load, fierce competition and expenses related to building its global fiber optic network, which reaches 200 major cities in 27 countries.
The company also said it has signed a letter of intent with Hutchison Whampoa Limited and Singapore Technologies Telemedia Ltd. for a $750 million cash investment and a joint majority stake in the company's equity.
Asia Global Crossing said it was not affected by the filing.
The telecommunications sector took a further hit Thursday when voice and data firm McLeod USA filed for bankruptcy protection as well. The company had previously warned it was working on a restructuring plan and could file for bankruptcy protection.
In acquisition news, British telecommunications firm Cable & Wireless said Monday it had completed its acquisition PSINet Japan for $16.6 million. The sale was first announced in early December.
Keeping with acquisitions for a moment, Managed Security Service Provider TrueSecure said Tuesday it has acquired Three Pillars, Inc., a Georgia-based provider of systems-based managed security solutions. TruSecure said it will integrate Three Pillars' remote management and monitoring services into its managed security service offerings. Terms of the deal were not released.
It was also a big week for hardware, with two companies unveiling major additions to their product lines. On Tuesday, computer giant Hewlett-Packard expanded its Intel-based server offerings for SMBs by announcing the HP Server tc2100, which is designed to provide maximum efficiency at a minimal cost for small businesses.
And on Monday, Sun Cobalt announced the new Qube 3 server appliance, which the company is targeting home networks and small businesses. The snazzy-looking Qube 3 enables home offices and small businesses to host their own Web sites, set up e-mail systems and more.
On the services side, Rackspace Managed Hosting unveiled its new customer service portal Wednesday, http://my.rackspace.com. The portal is designed to provide customers with timely information on potential security threats to their servers. Users can view current information OS and software vulnerabilities, viruses and other loopholes.
In financial news, TELUS Ventures, the investment arm of Canadian telecommunications firm TELUS, said Thursday it had invested US$2 million in Hostopia, a Toronto-based firm specializing in private label Web hosting services.
TELUS said Hostopia is an anchor tenant at is Toronto data center, and that the company has incorporated Hostopia's hosting software solution as part of its Web hosting package targeting SMEs.
Meanwhile, optical ISP Cogent Communications said Wednesday it had been approved for listing on the American Stock Exchange.
And in European news, UK Web hosting firm Virtual Internet made headlines today when it announced it would recommend a takeover by domain name registrar Register.com.
The offer values Virtual Internet at approximately $17 million US.
Richard Forman, Register.com CEO, said the acquisition, if approved, would "foster Register.com's growth in the U.K. and Europe, particularly in the corporate domain name services market."
Virtual Internet hosts over 106,000 domains.
Looking ahead to next week, all eyes will likely be on the telecom sector. With two major telecommunication firms filing for bankruptcy this week, speculation on the future of the companies and their respective is likely to be rampant.