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New Business Trends  Internet Business
Predictions in the Hosting market
As companies large and small examine the costs of running their own networks, the prediction globally is towards outsourced services because the total cost of ownership increasingly becomes too high when all factors are taken into consideration.
In addition to the necessity of keeping the hardware and software infrastructure current, there’s the not-inconsiderable issue of support and sysadmin staff. IT skills are still in short supply and smaller companies simply find costs too high.
Today, networks need a range of skills from simple sysadmin to sound security and networking expertise. Companies cannot afford to expose their networks and data to security risks, spam and viruses. The biggest benefit of outsourcing servers and networks is that the entire architecture becomes managed by professionals, providing the company with predictable networks managed by a Hosted Service provider (HSP) 24/7.
Managed and hosted services can include both WANs and LANs, as well as web and email servers. In addition they can encompass a wider range of communications services from voice and data transport to applications, such as contact centers, unified messaging, enterprise and public directories, voice applications, multimedia communications, and conferencing. The convergence of voice, data, the internet and, more generally, hosted services is part of the overall managed-services concept.
Moving to a hosted and managed service solution allows a company to focus on its core competencies. Its network is now in the hands of professionals, who not only manage it daily but also provide proactive measuring and monitoring. Regardless of the size of your operation, you now have a dedicated resource that will provide current analysis of system usage as well as help you plan your IT needs as your company grows. All this comes without capital outlay, as well as bringing you solutions that can be instantly implemented and useable.
Convergence
With the recent deregulations in the local telecomms market, bandwidth pricing is already falling. It is now becoming viable, more than ever before, to have branches sharing one application communicating over a VPN (Virtual Private Network) infrastructure, with all applications hosted centrally on that infrastructure. Customers will start looking to the HSPs to provide the environment, management and uptime of applications they have previously kept close to their hearts and chests, and HSPs will move away from being predominantly internet hosting facilities to hosting internet internet-independent applications such as ERP systems.
Another trend is that regional companies moving all their servers from their LAN into a Hosting Service Provider (HSP), which eliminates the need for regional support staff in smaller offices. The HSP provides a centralised and managed hosting service, again, 24/7.
There is a general, if gradual, trend of Hosting Service Providers taking more ownership of customers' complete hosted environment (mission-critical applications and data included). In the past, an HSP would always focus on delivering robust, resilient and redundant internet data centres - with services around that - purely at an infrastructure level. Customers now expect HSPs to become more involved in their day to day operations, taking control of the management of their applications and data and thus moving to the full suite of Managed Hosted Services.
Disaster Recovery
Unfortunately it often takes a disaster to make management realise that spending IT budgets on Disaster Recovery is not "optional" or "nice-to-have". When information is readily available it is worthless, when scarce it is priceless, and recent disasters such as 9/11 and the tsunami opened the world's eyes to the value of data. No matter how small your business, your survival as a viable operation is dependent on your data – customer lists, suppliers, accounting and other business-critical data.
More customers are already starting to demand 99.999% guaranteed uptime. Focus on solutions offering multi-geographic hosting environments, facilitating load balancing, replication and failover, are becoming more and more common as customers realise that their businesses rely on mission-critical systems.
The SMME Sector
Recognised by our government as perhaps the most important and fastest-growing sector of the economy, the SMME (Small, Medium and Micro-Enterprises) market employs more than a quarter of our workforce in more than a million businesses.
Hosting Service Providers are now offering services to the emerging and existing SMMEs. As bandwidth pricing decreases, more people will have better internet access, cheaper than before, resulting in another boom in online companies. Products which were previously tried, but failed due to expensive bandwidth pricing will be reintroduced, and more new entrepreneurial ideas will evolve. HSPs need to be ready for this, evolving solutions and services as demand for new solutions increases.
So the outsourced managed and hosted services model looks increasingly attractive. Benefits are broad, and include:
▪ Currency of all software – from operating systems to middleware to applications
▪ Currency and power for the hardware platform
▪ Additional features, probably previously dismissed due to high costs, can now be included –disaster recovery, online storage, load balancing, spam filters, firewalls, measurement and monitoring
▪ Customers have all the resources of a team of experienced professionals
▪ Economies of scale are applied across the board, making solutions as affordable and cost-effective for smaller organisations as for large enterprises
▪ 24/7/365 support
▪ SLAs
Before deciding on a move to outsource your systems, ask some questions:
▪ Is high availability critical to your business’s success?
▪ Does your network require changes?
▪ Will you need scalable and robust systems?
▪ Is security a major concern?
▪ Is it cost-prohibitive to stay current with technology?
▪ Are you a start-up business with limited capital?
▪ Do you have access and the budget for skilled IT staff?
▪ Is the cost of maintaining your network increasing?
▪ Is your business growing faster than your ability to deliver its network?
Your answers to these questions might prompt you to consider outsourced services.
By Sean Nourse, Manager, Hosted Solutions, Internet Solutions – www.is.co.za
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