Web hosting vendors have highlighted the importance of innovation
as they search for greater profitability in the sector.
Speaking at a US Web hosting conference, Mark Shull, the CEO of
Digex, said the Web hosting market was undergoing massive change
following a lightning-fast inception in 1995 and phenomenal growth
until last year.
"We are now in transition as companies struggle to come up with
long-term business models which are more sophisticated," Shull
added.
At the crux of those models are enterprise strategies which offer
corporations hosted methods for interacting with suppliers and
customers. Hosted or managed applications that are more efficiently
integrated with enterprise customers' back-end systems will also
play an important part.
"The Internet right now is great at connectivity, but it connects
everything to a person," said Shull. "The application server now is
becoming as prevalent as the Web server, and this will allow for
more sophisticated integration between hosted applications and
installed enterprise systems.
"Enterprises will therefore feel increasingly more comfortable
turning over applications to hosters. Those applications, at first,
are likely be all sorts of commerce-related undertakings, instead
of mere e-commerce operations."
Although Shull painted the Web hosting industry as being poised to
take off in the enterprise sector, others offered more sombre
observations.
Paul Santinelli, the CEO of NOCPulse, an Internet infrastructure
company, said things would get tougher for smaller hosts and
managed service providers as larger players such as Digex eyed the
enterprise customer base.
"The pole-climbers have come off the poles and into the data
centres," said Santinelli, who also predicted that the hosting and
MSP space would witness a large amount of consolidation in the next
eight months.