Analysts predict Web-hosting growth

The Web-hosting services market is going to explode in coming months, according to IDC's Internet and e-commerce analyst Brooke Galloway.

Galloway believes the increasing demand for the Web-hosting services will reap big dollars for service providers that are consistently upgrading facilities to cope with the demand.

According to IDC, the domestic Web-hosting market reached $42 million for the middle of 2000, and is predicted to expand to $105 million by the end of December.

Galloway said the biggest driver of Web-hosting services was the nature of Web sites being developed. Whereas sites were once predominately information-driven, static corporate marketing sites which described product offerings and gave contact details, today's Web sites are becoming more dynamic, personalised and targeted. She used the example of the e-tailer, whose site is mission-critical because any downtime is time without any revenues whatsoever.

Any site of this importance to the business' revenues is becoming more likely to outsource the site's hosting and management to a trusted partner.

"If you're hosted at a data centre, the bandwidth to the Internet you are provided with is likely to be better and you're likely to have better redundancy and security," she said. "The people generally have better skills and knowledge about managing your site, and can keep it up and available 99.5 per cent of the time."

Galloway said businesses are outsourcing their Web site management because they get better service levels, and Web-hosting services are proving cost effective. "Businesses are starting to evaluate service-level agreements. They are attracted to those deals where if your site goes down, you are entitled to a penalty rebate on the fees the host charges due to any potential lost revenue," she said.

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