We have mentioned, here and there, that the mass market for Web hosting customers could be out of your grasp at this point. As we have also described at length, that market is now the almost-exclusive province of the very biggest Internet brands – Google, Microsoft, Yahoo! and if there’s another, it’s really not leaping to mind at the moment.
To a certain extent, mass-market hosting has always been a competition of price. But that price competition has reached its long-term end. Each of those three companies offers a basic sort of Web hosting package for free (Yahoo! through GeoCities – the other two more directly).
The pricing competition was, once upon a time, a competition of scale. But not these days. One of the realities of the (somewhat) new Internet advertising ecosystem is that a Web site – and by extension a Web hosting customer – has an inherent valuable independent of any monthly fees.
It’s no coincidence that the three biggest challengers for the mass Web hosting market are also the operators of the three most significant pay-per-click advertising networks. Give away a bit of hosting through Blogger, or Google Pages or Live Spaces, and if that site produces one fifty-cent click a day (neither a particularly good nor a particularly bad performance), that’s $15 per month in PPC traffic.
Since price and scale are no longer determining factors in the mass market, that leaves branding as the determining factor in this particular race.
For all these reasons, and doubtless many others, it’s interesting to note that Google ranked first in Millward Brown Optimor’s annual rating of global brand value (reported here by silicon.com). Google leapfrogged last year’s leader, Microsoft, which settled into third place behind General Electric this year.
What does that mean for your business? Most probably nothing. What does it mean for the Web hosting business? Well, Google has a leg-up in the brand-based battle for the mass market. No real surprise there.
Given the odds (zero) that your company (unless it’s Microsoft or Yahoo!) can make a legitimate play for the mass market, perhaps the title of this post is more provocative than explicitly true.
And with last week’s acquisition of DoubleClick, Google also has a firm hold on the Internet’s advertising business. Another interesting product of this advertising ecosystem is the many-tiered, and contradictory relationships in the Web hosting business.
Your biggest competition for the mass hosting market, in each of these cases, is also probably a supplier of some kind. And more than likely, a partner.
