Competitive carriers looking to expand their revenue opportunities through web and applications hosting have found building substantial data centers to support those services a tough row to hoe. But new tools are now coming available that remove the backbreaking costs of entry into these new lines of business.
Typically, for mission-critical data, customers want dedicated servers. That means that for a typical application, a CLEC, ISP or other service provider has to invest in three physical servers--the first for the application; the second for the database for storing the calendar, for example, for a scheduling application; and the third to act as the terminal server for conditional access, including firewalls, customer profiles for authentication, etc. For the service provider, investing in all those servers is expensive from both a capital investment and from a real estate standpoint; competitive carriers frequently pay to store their network equipment in other carriers' switching offices or other locations such as "carrier hotels." But Ensim Corp. (www.ensim.com) and Sphera Corp. (www.sphera.com) are now rolling out new applications deployment and management systems designed to make shared physical servers as controllable, reliable and secure as dedicated servers at about one-tenth the cost. That means carriers can now leverage their investments in servers among multiple applications and/or customers while offering what looks to the customer like a "virtual private server."
Last October, Ensim introduced its Serverxchange virtual private server. In April, Sphera unveiled its HostingDirector 2.0 virtual dedicated server. Each platform is designed to partition physical servers into manageable virtual servers, but the companies have slightly different targets. In April, Ensim began helping broadband ISPs and network service providers become ASPs, while Sphera pursues a more widely established web-hosting customer base with plans to target applications hosts down the road.
From the service provider's point of view, virtual servers with per-customer and per-application control of physical server QoS could radically cut both capital and operations costs. Where a typical dedicated server architecture requires the three servers per customer, Serverxchange and HostingDirector would require only one physical server partitioned for all those functions. Both systems also provide automated configuration and provisioning, as well as management interfaces for the service provider and customer alike.
For service providers trying to enter the hosting arena, the combination of automation and customer self-care, both companies say, adds up to substantially reduced installation and ongoing operational labor requirements. For end customers, the platforms promise a compromise between the cost of reliable dedicated-server and relatively unreliable shared-server website and application host services.
Breaking Ground
For established hosting companies, the tools and the companies that use them may pose a threat, as the new platforms make it easier for ISPs and other new carriers in this space to launch value-added content and application hosting services without having to build complex hosting facilities.
Ensim is particularly targeting this market as network service providers and ISPs face pressure to integrate value-added services. Taking advantage of the small form factor of the Serverxchange, Ensim is partnering with a number of network device makers, such as Ennovate Networks Inc. (www.ennovatenetworks.com), to distribute the servers across service provider and ISP infrastructures.
"The Serverxchange will reinforce our virtual services layer that sits at the edge of the network," says Greg Pisano, director of systems product management for Ennovate. Ennovate provides DSL, frame relay and other broadband network service providers with equipment that partitions edge routers into virtual routers that provision VPNs and are controllable by end customers. "Together we can automate deployment of hosted applications on a VPN."
Ennovate foresees sharing the same rack with Ensim in a service provider PoP. By linking virtual servers to virtual routers, the companies together "are well positioned to help service providers find new revenues," Pisano says. "The goal is to bring management of VPN services and hosted applications together, enabling the service provider customer to select from a wide range of networked applications. This is the beginning of service provider entry into a range of service layer opportunities, including domain name service, e-mail, web hosting and file transfer servers."
Sphera also believes that manageability of servers and applications now can be distributed to all interested parties in the ASP chain. "Service quality must extend from server manager and hosting center through network provider, all in a chain, moving across each other's boundaries," says Sphera's CEO Tamar Naor. "We want to provide one, homogeneous solution that serves them all, including the end customer, giving them new levels of direct control."
A Granular Approach
Despite the products' names, say Ensim and Sphera executives, the "virtual" private and dedicated servers incorporate granular controls of real, physical server resources. Both systems also promise compatibility with Linux and Sun Microsystems Inc. (www.sun.com) Solaris operating systems and, by year's end, Microsoft Corp. (www.microsoft.com) Windows NT.
"Allocation of resources--central processor, disk bandwidth, network bandwidth--is real time, not nailed up," says Ensim president and CEO Ken Fehrnstrom. "The levels of those resources can be translated into service level agreements with the customer."
Echoing that emphasis, Sphera's Naor says, "we provide control of disk, input/output and processor per account, including the ability to set limits per account. At the same time," he adds, "we can track usage of those resources and bill by usage." Both systems could enable "burstable" use of additional resources when they are available.
Also partitioned are management system GUI views, allowing the web or applications host, ISP, network service provider and customer various versions of web-browser-accessible control panels, as well as performance monitors and reports. The systems enable the provider to limit the view and controls afforded the end customer, and firewall technology controls access of the management system to each virtual server.
Both companies say their systems automate the processes of configuring servers and loading applications and upgrades, even across multiple distributed physical servers. "We include clustering technology to control multiple servers and to automate distribution of new applications and fixes from one graphical user interface," says Sphera chief technology officer Raphael Salomon.
The automation means that service providers can remove data-entry errors that are common to manual configuration of IP addresses and other account information.
"The customer or host can change packages, control QoS levels or add new apps," Salomon says. "Whether it's smaller site-builder shops reselling big hosting provider facilities or applications managers, data centers or [network service providers], we enable each level to brand the management GUI and to customize it."
To ease installation, Ensim has developed a "wrapper" that encapsulates an application and insulates it from the server operating system. This middleware enables the loading of applications without any adjustment in the application itself to accommodate partitioning. "Operating system makers then don't have to certify any application for the hosted environment," thereby speeding deployment, Fehrnstrom says.
Working since last winter with J.D. Edwards & Co. (www.jdedwards.com), Ensim claims to have reduced hosted environment installation and configuration time for that company's complex enterprise resource planning (ERP) applications from three days to several hours. "Then the customer can drag and drop the J.D. Edwards application to his private servers, freeing up his [management information systems] staff to do other things," he says.
If an end customer undertakes a short-term extranet or promotional project requiring additional server space, "the customer can change his own resources," says Fehrnstrom. "We meter all that, so the provider can bill by resources actually used."
Ensim's Serverxchange is available now and according to the company has been successfully tested with up to 800 virtual private servers per physical server, although early users plan from five to 50 virtual servers per physical server. Also available now, Sphera's HostingDirector 2.0 is designed for 200 virtual dedicated servers per physical server. Its self-provisioning and billing system components entered beta trials May 15. Its automatic upgrade system entered beta the first week of June.
Planting the Seeds
Adoption of QoS-enabled shared servers could change cost and revenue assumptions for everyone in the value chain. Both Ensim and Sphera hope to accomplish this, first by partnering with independent software vendors (ISVs) to package applications into shared-server-ready bundles.
To ease deployment for ISVs, Sphera has developed APIs to open source components such as send mail, file transfer protocol (FTP)/telnet and common gateway interface (CGI) command scripts, while also providing access to extensible markup language (XML) databases for automated integration of an application with OSSs. These fingers into overall hosting operations assure that "no manual upgrades are required for operations such as a new security fix across tens or hundreds of servers," Salomon says.
Ensim is working with ISVs to create get-started application bundles for various, standard customer needs. "With ISVs, we might bundle four or five applications for web hosting or three to five applications for e-commerce, and/or our ASP customers will bundle themselves," Fehrnstrom says. "We test the applications working together."
While traditional shared server systems are allowing ISPs and website-hosting firms to offer unbeatable $19.95 per-month service pricing, unreliable performance of those systems continues to create high customer churn, Fehrnstrom notes. On the opposite end of the spectrum, he says, highly reliable dedicated server services typically cost $269 per month, plus up to 10 times that much in overall dedicated facilities management costs.
In contrast, Fehrnstrom says that Serverxchange can translate to service provider revenues of $99 to $250 per month, per customer.
"As they move from a shrink-wrap to a service model, we work with ISVs to develop a model for what it costs to host the application for each player in the chain," he says. So far, that work has led to the $99 to $250 per-month suggested pricing for a service that adds the value of dedicated-environment QoS controls to the lower physical server costs of a shared environment.
So confident is Ensim that this pricing model will improve customer satisfaction while also improving provider costs and revenues, it is asking providers to pay Ensim $30 per month per private server, regardless of how many resources each private server uses.
Changing minds about the reliability and security of shared environments will take time, Fehrnstrom admits. "We think security issues will be looked at for the next year or so, and then the customer will accept the shared architecture."
