June 6, 2007 -- (WEB HOST INDUSTRY REVIEW) -- A Web hosting offering has certain obvious limits, many of them related to the physical restrictions of the space, or the equipment available to the host.
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Many times, these limits are a big part of what defines a service, as in the case of disk space or bandwidth. And they are often how hosts quantify their business, using revenue per server or revenue per square foot as measures of success.
Hosts often seek to increase that revenue per square foot through value added services, layering managed services or applications on top of simple hardware solutions.
Blake Nelson, director of solution sales for performance monitoring software provider Absolute Performance Inc. (absolute-performance.com) says monitoring technology can add value to a standard hosting offering in several ways. In some cases it can increase the revenue per square foot of a standard dedicated offering by many as many as 10 or 12 times.
According to John Galloway, Absolute Performance's VP of Sales, there are several ways a Web hosting provider can deploy the company's System Shepherd application and IT infrastructure performance monitoring tool in its own facility and offer it up as a white-labeled service.
Large dedicated server hosts, colocation providers and telcos can set up the System Shepherd back-end within their own environments, says Galloway, and sell add-on monitoring services piece by piece
Smaller hosts, those that can not afford the major expense involved in setting up and installing the monitoring infrastructure can use the service the way an end user might, applying monitoring to its simpler products to craft a true "managed hosting" solution that can generate more significant revenue per square foot.
In such a case, the hosting provider would offer a co-branded solution based on a managed service provided by API.
Nelson says one of API's differentiating features is that the product was designed from the start to be delivered as a service.
"We're going to be there as a service provider for you as long as we're doing business together," he says, "and I think that's something that's very unique for us and we want to highlight the fact that we provide it as a service for our customers. We're going to give you channel marketing training, we're going to give you sales training, we're going to give you technical training. We're going to collateral support. We're going to give you sales and engineering support. We're going to give you ongoing maintenance for the software application. We're going to go out and visit customers and be engaged in sales calls. It's going to be a true bi-directional relationship."
Building managed services into a hosted offering, says Nelson, can add recurring monthly revenue streams to existing customer relationships.
"We think," he says, "we've added significant customer value. And we've differentiated these hosting providers in the marketplace, and taken it away from a commodity sell to a true value added service."
And according to Galloway, monitoring produces a set of data that can be presented to customers at the end of each month as a tangible result of their subscriptions.
"What's somewhat unique around the managed services," he says, "is we use the software as our tool to monitor things, but it's also how we show the customer what we've been doing for them. So that portal becomes the deliverable at the end of the month; what you actually paid for. It makes it more tangible."