THS Articles

Web Hosting for the Masses

By Cliff Boodoosingh

Don’t tell Jeff Stibel that Web hosting is a commodity service. The CEO of Web.com, formerly known as Interland, will take issue with that.

Those days of selling Web hosting as a technology are gone. Interland, of old, sold broadband, bandwidth, megabytes, storage and domains. Web.com under Stibel’s leadership and direction is providing a user-friendly, user-focused approach of “productizing the technology and marketing the product.” No longer are you buying a domain--it’s now a Web address. It’s not hosting, as such, but a Web presence or a website with marketing or even a business storefront.

Today’s average small business owner doesn’t know much about technology, he notes. That’s why 40 percent of today’s 25 million small businesses don’t have websites, he posits.

“They’re intimidated… what’s 20 megs or 50 gigs, what does that mean? (Tell them) you can post 1,000 photos, that’s a product, that’s something they need and understand,” conveys Stibel.

Secondly, don’t tell him that customers want the cheapest possible price. He’ll tear that apart. He cites Starbucks’ ascent in the marketplace of counterintuitively (perhaps) entering a commoditized market when the price of coffee was going down and stepping in with higher prices, built in with an “experience” factor behind the product.

Stibel has seen similar customer gains when Web.com raised Web hosting prices by “peeling back the onion and giving customers a product that’s easy to use.”

“One of our partners Dex Media offers website packages for $100/month and that’s their cheapest offer," says Stibel. "They add significant value and (enable) customers who don’t have a Web presence to do so easily and conveniently.”

“So when you sell a commodity, price is an issue. When you are selling a product or experience, it’s not that important. (Essentially) a website is online real estate and that’s much cheaper than offline real estate and even at a higher price point, Web.com (services) is cheap.”

How has the new paradigm shift impacted growth?

Stibel asserts that the Interland of old never grew organically despite the $400 million of investment the company used over the past few years. In the first quarter of this year, the company added 4,000 new customers and that is the tell-tale sign of the strategic shift.

Enhanced services and partnerships are the key avenues being focused on to drive revenue growth.
Stibel is excited about the company’s partnership with Microsoft and sees tremendous potential in Hosted Exchange particularly calendaring and email functionality tied to hand held devices such as the BlackBerry.

Web.com is gaining traction in the market with its retail distribution channel also. ‘Website in a Box’ site builder suite is available at Staples, Office Depot, Amazon.com and CompUSA.

And as the company moves forward they are leveraging “underutilized assets” from the past, namely 20 patents acquired over the years in Web hosting, data center management, Web server management, Web services, graphic user interface tools and website design.

Interestingly, the company has been involved in building four million websites since founding in 1995.
With $5.6 billion dollars in the SMB Web hosting space up for grabs, it’s not hard to imagine Web.com having a firm hand in building out millions more.