Xalted - Data Services Grow Up

The data center business is booming. No big surprise.

With more companies moving onto the Internet and a push toward more transaction-based sites rather than simple marketing sites, hosting is becoming more involved. So companies with an eye toward increasing their speed to market, avoiding expensive human resources costs and provisioning connectivity quickly frequently look to outsource their hosting requirements.

Forrester Research Inc. (www.forrester.com) forecasts that U.S. web hosting revenue will reach $19.8 billion in 2004, up from $1.4 billion last year.

"Value-added services will grow faster than the other segments as web hosting revenues skyrocket and service providers grow their subscriber bases," says Steven Harris, an analyst with the business network services unit at International Data Corp. (www.idc.com).

In the article "The Data Center Opportunity," I discuss the economics of running a data center space and the benefits of outsourcing web hosting.

Building these data centers is no small task. With mission-critical applicationsmoving to the web, outsource customers expect data centers to offer reliability virtually on par with the lifeline phone network. In the article "Mission Possible: Data Centers Do More Than Just House the Box," network operators and their vendors discuss the significant requirements of the new data center. Meanwhile, in "The New Partitioning: 'Virtual Servers' Could Help Web Hosting Newcomers Compete" , Peter Lambert explores how new tools may enable companies such as CLECs to enter the data center market more cost-effectively.

Other articles in the pages that follow explore other important topics and trends in the realm of data services, including the server wars, multicasting, gigabit Ethernet, DSL and cable modems.

Enjoy.

Until next time,

Paula Bernier

Editor-in-Chief