With Web host Exodus Communications’ bankruptcy and closure of some locations late last year, and the recent disclosure of WorldCom Inc.’s US$3.85 billion accounting blunder, it is hardly surprising companies are a little gun shy when choosing a Web hosting solution.
Warren Chaisatien, senior analyst with IDC Canada in Toronto, said the recent WorldCom news will not irreparably harm the perception or adoption of Web hosting solutions, though he added a caveat. “Customers may become choosier or pickier when it comes to selecting a service provider,” he said. In the past it was price, performance and technical capabilities customers were looking for, he said. “When we go forward, customers will start to look at (corporate) financial stability.”
It was certainly on Supriyo Sen’s radar when the CTO of Toronto-based Tucows Inc., an Internet channel management company, was forced to vacate the Exodus’ Toronto data centre. Since Tucows is essentially a Web-based company, being down for more than a few hours was impermissible.
“It had to be done right because our entire revenue base depended on it,” Sen said.
time is not on your side
Sen and his team had less than two months to figure out how to move an entire company’s servers and inconvenience no one.
He was first informed last October that Tucows had to find a new home by year’s end. The first question, the one every evictee asks, is where do I go now? Tucows put out an RFP and got responses from IBM, Telus, Bell and Q9. And in one of those truths stranger than fiction, Tucows got a price quote from WorldCom. Luckily for Sen its price was way too high, so it was not considered.
Once the decision was made to go with IBM (which had the best price for the bandwidth and cages needed to store the servers) his team had to figure out how to do the move seamlessly. In all, 110 servers, plus numerous routers, load-balancers and switches had to be moved, installed and up and running with minimal downtime. IBM helped Tucows make the transition as painless as possible – coming up with a well thought out plan, Sen said. This included providing solutions to help move IP and network addresses, a task that can often prove tricky when time is of the essence.
The long hours paid off as Tucows needed to be shut down for less than five hours.
Though WorldCom customers are not yet in the dire straits Sen was in last year, he does empathize with their plight. “I feel a bit of relief (that I am not in their shoes),” he said.
But this is a problem with the networking market. People think if you put in bandwidth, the business will succeed, he said. “The bubble was not just in WorldCom, it was all over the networking world.”
Even the rock-steady IBM admits Web hosting has been a roller coaster ride since its inception.
“It is a dynamic marketplace…and it will continue to be a dynamic market place,” said Paul Lovell, referring to the WorldCom and Exodus problems. The general manager of e-business hosting services with IBM Canada Ltd. in Toronto has been in the game long enough to realize IBM has an opportunity to position itself as a Rock of Gibraltar in a volatile sector of the IT industry.
“Clearly we are positioning ourselves as a stable, trusted service provider,” he said.
“We have earned that, and we didn’t do that in the five years that we have been in this business, we earned that in the 35 years that we have been running operations for our customers.” he said.
Chaisatien agreed that recent market turmoil can play into the hands of plyers such as IBM, Telus and Bell. Company stability will enter into the selection process, he said. On the other hand, Chaisatien predicted once the dust settles things will go back to normal and price and performance will once again become the top concerns.
Since IBM was the best deal, Sen didn’t need to factor in the value of its corporate stability, he said. But had this not been the case, he figures placing a value of around 10 to 15 per cent of the deal for peace of mind (knowing, hoping he won’t have to go through this again), is about right.