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Looking for an answer when it comes to hosting is not always easy for many enterprises. IT and IS departments in particular are wary of the term ‘outsourcing,’ as it could potentially, mean the loss of jobs.

When it comes down to it, though, the hosting industry is gaining steam in Canada, and there are a few reasons why. The benefits of having an expert on staff – no matter the size of your company – is definitely one appealing benefit for enterprises.

‘Hosting services’ itself is a very broad term, which encompasses various elements. Web hosting is the concept that immediately comes to mind, and is by far the top service used by Canadians, according to Dan McLean, analyst at IDC Canada in Toronto.

But there is more to hosting than just Web sites. Some specialized companies offer managed storage services, while others offer managed security services, such as firewalls. In most cases, the customers simply choose what they want and add it all into their monthly cost, some of which is shared with other tenants of a data centre.

While services such as storage have caught on south of the border, they have yet to snag the attention of the Canadian IT sector.

“It is absolutely fair to say that in the U.S. they are more advanced than Canada – by about two years,” notes McLean. “They’re quite a bit farther along in terms of understanding and the adoption of hosting services down there.”

Instead the Canadian scene seems to currently be focused on the Web hosting aspect, which doesn’t really involve a whole lot of sophistication, McLean says. What it really comes down to is the fact that many companies feel they do not have the technology, or that they do not feel up to the task of building and supporting their own site.

“So it becomes an issue around access to expertise that would allow them to do this sort of thing, and I would certainly characterize time to market as an issue as well,” McLean notes. “So you buy a hosting service and you can basically launch right away, or certainly very quickly.”

One big issue that many IT departments are forced to deal with when it comes to IT services is having to essentially hand off part of what it does for a living. On top of that, there is always the risk that whatever it is, it may not be easy to bring back in-house should the need arise. More importantly, though, is the fear that IT jobs will be cut.

That is something that McLean says will depend entirely on the company. In certain companies, that’s definitely what they want to do, he notes. They look at outsourcing – any type of outsourcing – as a way of reducing head counts and saving money. And outsourcing is in fact a way of saving money.

“But, conversely, there are other companies that may look at this and say, ‘You know what? What we’d like to do is pull our people away from the day-to-day firefighting and really get them focused on more business-critical activities. Let’s get them involved in doing more work around business processes and application processes and things like that as opposed to just dispatching people out to install software on desktops or to go and plug in a printer where a plug has come loose or whatever,'” McLean says. “But that is really dependent on the company.”

The fact is that when people outsource, it sometimes does mean jobs on the IS side, he adds. But on other occasions it is simply a way of getting rid of an operational activity that an IS department may not be able to do very well. IN many such cases, the firm would probably like to be more focused on activities that are more core to the business.

The following are a few stories from Canadian companies who have taken the hosting leap, and have found it to be the right choice for them.

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Jim Love, Chief Content Officer, IT World Canada

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