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Hostway, Cloud Hosting & SMBs

HostwayAs ‘the cloud’ beacons, a potentially lucrative segment for cloud services providers is the SMB space.

Despite the plethora of choices available however, the road to cloud nirvana is fraught with potholes, as both companies and solution providers step into territory that they are quite unfamiliar with.

While the savvier companies may opt to go with the larger cloud providers, namely Microsoft with Windows Azure, Amazon which owns the market-leading Amazon Web Services, and the HP Cloud, there are a large number of Tier-2 providers, led by Sungard, Hostway, Rackspace, and others.

This past year, I have had a few opportunities to be briefed on a few of the offerings from a good number of the cloud providers listed above. The briefings have allowed me to inform my opinions on their respective products.Azure

Most intriguing of the lot is Hostway, for several reasons.

First off, Hostway is a company that is focused on SMBs. Secondly, it uses Microsoft Hyper-V as the hypervisor for its products, though they run Linux primarily. Thirdly, they have a vibrant reseller program whereby they empower their local VARs to provide solutions hosted on Hostway in order to help end-user customers thrive.

As the CEO and Chief Technology Officer of Logikworx, which is both a managed services provider and a solutions provider in the SMB and midmarket spaces, I was intrigued.

The SMB sector is going through the start of a need to upgrade their computing infrastructure or environments for the future.

It also doesn’t help that cloud and hosting providers are resorting to the basest forms of cloud washing* in order to peddle their wares to an unsuspecting populace.

While my current and future clients have the luxury of having us do the hard work, most do not. Furthermore, it is always good to obtain more knowledge. Consequently when Hostway informed me of a HP Cloudbriefing availability with one of their analysts, I accepted.

Knowledge, they say – and I’ve found out – is power!

Listening to Moor Insights & Strategy on SMB hosting
In a briefing last week, Paul Teich, senior analyst with Moor Insights & Strategy, walked us through some of the trends he is seeing with respect to businesses in the space targeted by Hostway.

According to Paul, SMBs represent an opportunity mainly because of the fact that they commonly do not possess the in-house resources need to determine the best course of action to pursue

His research also revealed that the rôle of hosting is changing, from pure-play hosting firms like GoDaddy and United Internet, to vertically-integrated hosting firms that deliver integrated solutions like messaging, compliance, SharePoint, storage and more, either singly or as a user-customizable package.

What is meaningful here is the clear demarcation between the ‘S’ and the ‘M’ in SMBs in terms of available resources and company actions.

While the larger – id est, medium – firms may be able to make available and deploy resources to solve their IT needs, the small firms are hamstrung in their ability to marshal those same resources.

Stepping into the breach, suggests Paul, would be the small local VARs armed with relationships with hosting companies such as Hostway.

Paul also sees traditional servers and computing infrastructure going the way of the Dodo for the smaller of SMBs. He also sees most new businesses going cloud-first, as a way of getting business going.

So, why Hostway?
Looking at Hostway today, I have to admit that it has several things going on for it that make it incredibly attractive for a small business, and for the VAR servicing them:

i) It has a very good SMB focus.

ii) It has, in place already, a well-defined VAR/reseller program, with clearly enumerated VAR benefits, satisfying the all-important WIIFM factor for solution providers.

iii) It provides several value added services, not just a bare-metal hosting option.

Most importantly, Hostway uses Microsoft Hyper-V as their hypervisor.

For small businesses, most of which cannot afford VMware’s eponymous hypervisor, this allows them to perform the jump-off into the cloud relatively effortlessly.

I also believe Hostway allows partners to ‘own’ the customer, letting the solution provider to perform billing and most tech support services.

What do I think?
I had four reasons for joining the fray, if you will:

  • Gain more knowledge from those in the know – the hosting providers themselves,
  • Gain more knowledge with respect to trends from those in the know – analysts,
  • See if their conclusions in #1 and #2 are aligned with the conclusions of myself and my staff, and
  • Help us, and by proxy, you, make decisions on where to go in this cloud journey, and what platforms and partners to choose.

In all, Hostway and Paul were able to sate my appetite for more information.

I disagree, however, with the portend for traditional IT – client and server – computing infrastructure in small businesses.

As with libertarians in foxholes suddenly discovering God and calling on Him for help the first time they are faced with a fusillade from opposing forces, it is my considered opinion that even the most fervent of believers of cloud computing would clamor for local computing resources once an outage hits. If not even before, when network errors slow computing to a crawl.

My opinion here is derived from my decidedly unscientific survey of our business owner client inventory**.

Hostway has identified a gaping hole in IT services as regards SMBs – remember, small and medium businesses make up a sizeable percentage of new and existing businesses – and has developed products and services to tap into that need.

Which, without a doubt, is ‘A Good Thing’.

Hostway is definitely a company to watch, and if you need more information on trends and I would guess, his research data and methodology, contact Paul at Moor Insights.

Hostway is at

* Cloud-washing: Cloud-washing is the deliberate and mostly deceptive attempt by a vendor to rebrand an old product or service by associating the buzzword "cloud" with it. Adding "cloud" to the name of hardware or software in order to make it more up-to-date. Starting in the 2008-2009 time frame, cloud computing became a hot IT topic, and a vendor might rename its product to include the word if it were Internet based in any manner. Definition from TechTarget & The Free Dictionary

** Our ‘inventory’ is the list of client businesses that we currently manage, and the numerous businesses that we have performed VAR services for over the years.

© 2002 – 2013, John Obeto for Blackground Media Unlimited

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