Jupiter: Outsource Web hosting and save millions

In-house Web hosting is on its way out, according to a recent report by Jupiter Media Metrix Inc., as U.S. companies discover that they can save big bucks and potential time and money-eating errors by outsourcing Web-hosting tasks.

U.S. companies could save anywhere from US$6 million to $12 million over three years by outsourcing Web hosting services, Jupiter said.

Currently, 34 per cent of U.S. companies handle hosting internally and another 24 percent manage their applications internally but outsource server management. Many companies have opted for in-house hosting due to security concerns, control issues and customer service and confidentiality issues, according to Jupiter.

The problem is that companies overestimate the competitive advantages of in-house Web hosting, and fail to see the possible cost reductions that come with outsourcing the service, Jupiter reported.

U.S. companies with in-house Web hosting spend more on staffing and technology than they would if they outsourced these functions, saving 30 percent to 40 percent of their Web-hosting costs, according to the researcher.

The cost-reducing benefits of outsourcing are most apparent in companies with mid- to high-traffic sites, Jupiter said. Over three years, a company with a staff of 18 to 25 people would pay three times more per year than it would to outsource the activity. Furthermore, management tools and expenses would cost the company another $2 million over a three-year period.

In addition to paying too much for Web hosting, companies perform other Web hosting blunders such as initiating Web projects before their site hosting and technology infrastructure design is built, Jupiter said.

Eighty per cent of companies jump the gun on their Web development projects, Jupiter said, and due to this lack of planning, nine out of 10 of these ventures will incur some avoidable rebuilding.

Jupiter recommends that companies undertake infrastructure design in tandem with first-stage application planning and development. If this precaution is not taken, companies risk exceeding their scalability limits and may have to “shift into crisis mode,” incurring sky-high hosting costs, the researcher reported.

By choosing a technology infrastructure provider simultaneously with an application developer, companies can cut implementation delays by 25 per cent to 30 per cent, Jupiter reported.

When selecting for a Web hosting provider, companies should look for reliability, scalability, security, a proven track record, accountability, response speed and customer service, the researcher suggested.

After all, according to Jupiter, slimming down a company’s in-house Web hosting could fatten up its bank account in the long run.

Jupiter Media Metrix, in New York, can be reached at Web at http://www.jup.com/.

Would you recommend this article?


Thanks for taking the time to let us know what you think of this article!
We'd love to hear your opinion about this or any other story you read in our publication.

Jim Love, Chief Content Officer, IT World Canada

Featured Download

Featured Articles

Cybersecurity in 2024: Priorities and challenges for Canadian organizations 

By Derek Manky As predictions for 2024 point to the continued expansion...

Survey shows generative AI is a top priority for Canadian corporate leaders.

Leaders are devoting significant budget to generative AI for 2024 Canadian corporate...

Related Tech News

Tech Jobs

Our experienced team of journalists and bloggers bring you engaging in-depth interviews, videos and content targeted to IT professionals and line-of-business executives.

Tech Companies Hiring Right Now