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Mike Drach, theWHIR.com
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August 16, 2001 — (WEB HOST INDUSTRY REVIEW) — By hosting their Web sites and technology infrastructures internally, over one-third of U.S. businesses are overlooking a chance to save 30 to 40 percent on their costs, according to a study released by Jupiter Media Metrix (jmm.com) on Wednesday. Over the next three years, these costs could add up to between US$6 million to $12 million.
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“Companies that continue to host their own sites will gain little
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competitive advantage and spend more money on staffing and technology than
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those that outsource these functions,” said Jupiter research director David
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Taylor. “Those that act and act now will be saving millions in the long
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run.”
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The most highly trafficked sites stand to derive the greatest savings from
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outsourcing hosting responsibilities, according to the report. For
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instance, analysts found that an in-house staff of 18 to 25 costs over three
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times as much per yea, while management tools and expenses run an additional
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$2million over a three-year period. In addition, recurring costs such as
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bandwidth, co-location services and vendor management can easily add more
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than $1 million dollars in costs during the same period.
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Jupiter predicts that an increasing number of business will choose to
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outsource their hosting needs over the next three years, as the available
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savings become more apparent. Currently, some executives have been slow to
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make these changes because of concerns over security and control issues, as
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well as poor customer service by outside vendors.
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Along with these findings, Jupiter also reported that over 80 percent of
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companies undertake Web development projects before their site hosting and
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technology infrastructure design is built. According to Jupiter analysts,
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nine out of ten of these ventures will face some form of avoidable
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rebuilding as a result.
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“Companies engaged in Web development projects must select a technology
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infrastructure provider simultaneously with an application developer,” said
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Jupiter. “Doing so will cut implementation delays by 25 to 30 percent by
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eliminating wasted development time.”
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The report advised companies to consider a range of criteria when choosing a
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hosting provider, including reliability, scalability, security, proven
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success, accountability, response speed and customer service.
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Additional key findings will be presented in full at the Jupiter Web
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Enterprise Forum on September 12-13, in San Francisco. The forum will
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examine the planning, development, and management problems affecting all
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businesses that embrace Internet technologies. For more information, see
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Jupiter’s Web site.
About theWHIR.com
Since 2000, The Web Host Industry Review has made a name for itself as the foremost authority of the Web hosting industry providing reliable, insightful and comprehensive news, interviews and resources to the hosting community. TheWHIR is an iNET Interactive property. For more information on iNET Interactive, visit http://www.inetinteractive.com
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