WebCentral has established a new business called "Complex" that will serve the more sophisticated hosting needs of larger clients.
WebCentral has become a major player in the shared and dedicated Web hosting market in Australia, claiming an 18-22 per cent market share. While traditionally WebCentral has offered hosting services in a standard format, with automated processes in place to deal with most customer interactions, WebCentral Complex is a business unit that has been established to tailor more sophisticated hosting solutions to the customer's needs.
Complex will offer customers service-level agreements on availability and security, and also sees the hosting company move on from its reliance on the Microsoft platform. It has partnered with IBM for hardware and Dimension Data for integration services around the J2EE platform. It will also maintain relationships with Microsoft and Avanade for the provision of .Net solutions. "We have noticed a market opportunity -- those people that have a complex Web environment who may be building interfaces and connecting to legacy systems," said chief operating officer Andrew Spicer.
Rather than generate leads through Web development partners, Complex will strengthen its relationships with systems integrators who are likely to receive referrals for integration work in return for recommending WebCentral for their clients' hosting needs.
Sally-Anne Stansfield, newly appointed general manager of WebCentral Complex, said the hosting provider is looking to fill a gap in the market between the small providers that cannot offer such complex services, and whole-of-IT outsourcers and telcos that charge a premium. The Complex business will thus cater for customers spending between $100,000 and $1 million a year on hosting.
Complex will be a separate entity, although existing sales teams from WebCentral will be generating leads for it. "We needed to give it focus," said WebCentral CEO Lloyd Ernst. "Rather than just say we have a new product, it is likely to be more successful as a separate company that is 100 per cent owned by WebCentral."
So far only five of WebCentral's 130 staff will be employed by Complex, but technical managers will be transferred as customers sign up.
The team at WebCentral expects to out-compete both telcos such as Telstra and outsourcers such as CSC and EDS in the high-end hosting market. "The major outsourcers do a breadth of services but this is not their core competency," said Stansfield. She expects WebCentral Complex to undercut Telstra's pricing by at least 10 per cent.
And despite dire forecasts being released by large outsourcers for the hosting market, Spicer said sales staff are seeing demand for the services on the ground. "They have noticed an upswing in business confidence," he said. "The IT projects are coming back onto the front burner."
Stansfield expects the Complex business to earn $32 million in revenue over the next three years.