Apr 1, 2005 : The webhost industry: week review


📅 - Like most weeks in the Web hosting business, this week offered up a mixed bag of news from across the industry. But unlike most weeks, this week's news saw a collection of acquisitions so significant, and so various, that it seemed to put other issues in the background.

After a lengthy on-again, off-again courtship, MCI made what was probably this week's most significant announcement, saying it had accepted a newly-sweetened acquisition offer from Verizon, worth a reported $7.6 billion. The new terms amended a deal agreed to in February by the companies. MCI had postponed the closing of the deal while it considered the acquisition efforts of Qwest, which reportedly bid as high as $8 billion. Along with the telecommunications assets, the acquisition provides Verizon with control of one of the world's largest Web hosting operations.

Not quite as large in scale, but certainly more surprising, was the announcement that Google, a tech company that casts a long shadow, had acquired Urchin Software, a company with partnerships across the Web hosting business. Though almost no details about the deal were released, Urchin's Web analytics software is an obvious fit with Google's pay-per-click advertising offerings, already used by many advertisers to monitor in detail the performance of their campaigns on Google's AdWords and other advertising services. The companies expect the deal to be complete by the end of April.

Beyond the big two acquisitions this week, the shockwaves were subtler. But the subject was made significant by the sheer number of deals announced.

Another provider of Web analytics technology was acquired this week, this time WebTrends, and this time by a combination of a private equity fund and the company's own management team. Along with Francisco Partners, members of WebTrends' management team will invest in the new business, and the company's general manager Greg Drew will become president and CEO of the standalone business. The deal is expected to close by the end of June.

Web hosting provider Hostway announced this week that it had acquired Australian hosting provider IntaServe, the third acquisition the company has made since it entered the Australian market in 2003, previously picking up GlobalHost and Dedicated Hosting. IntaServe managing director Amin Kroll will take over from Hostway general manager Michael Farrel as head of the company's Australian operations.

Technology facility operator Digital Realty Trust announced on Monday that it had acquired two new data center properties ? in Philadelphia, Pennsylvania and St. Paul, Minnesota ? for a total of $74.6 million, including the assumption of $9.7 million in debt. The 15-story Philadelphia property is a technology office building that includes 654,758 square feet of space. The singe-story St. Paul property is an office and data center with 88,134 square feet of space.

Linux administration service provider LinuxForce announced last week that it had signed an agreement to acquire Web hosting provider CyberLoft, a company LinuxForce has been providing with Debian GNU Linux systems administration service and support since 1997. LinuxForce says the acquisition will strengthen the company's Web hosting and Web development business.

Internet access, VOIP and IPTV solution developer CoConnect said Thursday that it had signed a letter of intent to acquire the issued and outstanding shares of Web hosting provider Rndtuit.com and Web design provider EonDeck.com. CoConnect said it would exchange 1.5 million shares of restricted common stock for 100 percent of both companies. Both Rndtuit and EonDeck are Nevada companies under the direction of president and CEO Michael McGee. CoConnect says the acquisition will help the company to expand its wireless Internet industry presence, providing an immediate presence in Las Vegas.

While the sheer weight of acquisitions news was perhaps most significant in this week's news, the ongoing interest will likely come from the biggest stories, as MCI demonstrates whether it is willing to stick with its acceptance of Verizon's offer the second time around, and Google gives Web hosting providers more reason to expect its eventual arrival as a competitor.

Reads: 1436 | Category: General | Source: TheWHIR : Web Host Industry Reviews
URL source: http://www.thewhir.com/marketwatch/wrap040105.cfm
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