Jun 20, 2008 : The webhost industry: week review

📅 June 20, 2008 - Like the week before last, the biggest story this week was the relatively unexpected announcement of a major acquisition that brought a significant new player into the Web hosting business.


On Thursday, we reported that Hostopia had reached an agreement to sell to printing and brand services company Deluxe. The deal, structured as a merger, would see Deluxe pay $10.55 Canadian for each outstanding share of Hostopia, for a total of about $124 million. The deal has been approved by the boards of both companies, but remains to be approve by shareholders at a special meeting called for just this purpose. Hostopia says that shareholders representing about 35 percent of the company's stock have agreed to approve the deal at this point.

Following the announcement, theWHIR spoke with representatives from both Hostopia and Deluxe, seeking to better understand the synergies between two companies that appear at first glance to be a bit of an unlikely match. According to both companies, they see their services as quite compatible. They say their core customer descriptions are almost identical, and Deluxe's huge addressable base of millions of customers are a promising target for the kind of web services Hostopia can provide.

While the single acquisition drew the most attention, this week saw another flood of announcements about the building of "green" data centers or the retrofitting of existing facilities.

On Tuesday, we reported that a data center building startup Advanced Data Centers is in construction of its first facility, a "green" facility located in the McLellan Business Park, located at the McLellan Airforce Base in Sacramento. The building will cover 237,000 square feet, and will be made up of 11 private data center suites of 10,000 square feet each.

Also on Tuesday, hosting provider ServInt announced it had deployed a range of "green" practices in its business in order to run a more environmentally friendly operation. The company says it has committed to offsetting the carbon footprint of its VPS hosting services 110 percent. It intends to do so by contributing to reforestation efforts operated by American Forests.

And on Thursday, we reported that "green" data center firm EvoSwitch had completed the second phase of its Amsterdam facility, adding 2,000 square meters of space to its existing 2,000 square meters. The new phase cost the company 9 million Euros. EvoSwitch expects to begin working on a third phase in late 2008.

Along with the environmental news, and in some cases connected to it, this week's news saw one minor common thread among several announcements of new events or seminars for hosting providers.

On Monday, the Silicon Valley Leadership Group announced that it would hold its first annual Data Center Energy Summit June 26 in Santa Clara, California. The one-day event is being held in partnership with the Lawrence Berkeley National Laboratory and will take place at the Sun Microsystems campus. It is dedicated to sustainable data center design, energy efficient engineering and operational practices for green computing.

And on Wednesday, hosting provider PEER 1 Network Enterprises said it would host a free webinar in conjunction with OnDemand Solutions and Mural Ventures, June 24 at 2 p.m. Eastern Time. The event is titled "The Seven Deadly Mistakes of ISV SaaS Offerings," and will cover that list, including such topics as cannibalizing current revenue, underestimating the need for customer service, offering free trials that don't convert prospects to customers and underestimating the need for web-centric support, sales and marketing.

This week's biggest story, of course, was the acquisition of Hostopia. And it will likely be the most significant story in the weeks to come, as the company gathers shareholders for a final decision on the proposed deal.