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"The Information Technology market is steadily bifurcating into a commoditized infrastructure market with a rapidly shifting layer
of applications and services. Whether its virtualization, network monitoring, or the emergence of DPS, there are a
number of market dynamics having a tremendous impact on buyers and vendors alike. In the face of this constant change,
Tippit helps thousands of real IT buyers make better decisions every day. We also help buyers assess vendors who can
solve their specific business problems"
Source : Tippit
Managed Hosting Services
Hosting Services is also known as :
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Web Hosting Unleashed
Table of Contents
- Executive Summary
- Managed Hosting Services Overview
- The Benefits of Managed Hosting
- Market Overview
- Key Services and Features
- Managed Hosting Costs
- Checklist: What to Ask Before You Buy
Hosting a Web site in-house can be expensive, requiring the
necessary hardware, software, power and security precautions, not to
mention the cost of bandwidth. On-site hosting can also drain company
resources by slowing down the network and taking time away from the
in-house IT staff.
In recent years, growing companies have elected to move their
Web-hosting functions off-site to shared facilities that allow them to
reduce costs and gain greater security and performance of their
technology. An attractive option is managed hosting " that is, the use
of Web servers that are dedicated specifically to single Web sites,
with service and support handled by the hosting provider, who monitors
it, troubleshoots problems, performs regular backups, installs software
patches and performs other standard management tasks.
At datacenters, companies can take advantage of economies of scale.
Multiple customers can locate their network, server and storage gear in
a secure environment. These facilities usually feature 24-hour physical
security, and customers have around-the-clock access to their
For smaller companies, vendors also offer hosting on shared machines
that serve a number of different Web sites. However, customers that
select this option must share the machine"s resources with other
clients, limiting the amount of memory and bandwidth they can consume.
On the other end of the spectrum, companies that outgrow a managed
hosting environment often moved to a colocation hosting model. With
colocation, companies can take advantage of all a datacenter offers "
security; high-speed, redundant bandwidth; their own equipment; and
so on. They have their locked own cages where they house their own
hardware, loaded with their choice of software. This option, however,
for larger companies who have the dedicated resources with sufficient
experience to manage their own equipment.
Managed Hosted Overview
Dedicated servers used in a managed hosting environment differ from
those used in a colocation arrangement in that you don"t own your
equipment; instead you lease a server from the hosting provider. The
hosting provider takes full control of your machine, unlike in the
colocation scenario where it would have only limited access " often at
Managed services vary greatly from provider to provider. Some offer
on-site technicians to manage your equipment, whereas others only offer
spot services such as disaster recovery and operating-system updates.
Some provide service for anything that touches the server and go so far
as to go to the customers" offices and set up their emails and do
on-site training to help them understand the management control panel.
In the words of one industry observer, ""managed services" can be
anything from fully managed services to manage-it-yourself services."
Make sure to ask the hosting company for a detailed list of support
services, and make sure the provider"s services map well to what you"ll
need now and for the foreseeable future.
The Benefits of Managed Hosting
Dedicated servers allow you to get up and running fairly quickly,
with no worries about purchasing hardware and software licenses. Most
hosting providers can deliver your specified server in a short amount
of time " typically 24 hours to one week " and provide you with more
bandwidth and power than you could get for the same cost if you hosted
your site in-house.
Managed providers also provide tech support. They often offer disk
backups, firewalls and load balancing without your having to drive to
the facility to perform these tasks. Sometimes site-management services
are included in the overall costs, although in some cases specialized
support will cost extra.
With a dedicated-server service, you also don"t have to worry about
transporting your equipment to the facility and setting it up, since
the equipment is provided by the vendor. This can take the headache out
of buying and maintaining equipment, especially for companies that lack
IT expertise or simply don"t have the time to manage their off-site
Keep in mind, however, that you need to make sure a dedicated-server
provider pays as much attention to incremental maintenance as it does
to your initial installation. Waiting for trouble tickets to be
accepted, escalated and closed can have an impact on your bottom line.
This should be hammered out before you sign on the dotted line so
that you know what kind of service you will, by contract, be receiving.
The managed hosting space has undergone tremendous growth in the
last year. Tier1 Research reported that the market for managed hosting,
the largest sector of the $12.3 billion Web-hosting industry, grew by
more than 30 percent between January 2007 and January 2008, and they
attributed that growth to several trends. These include virtualization,
a growing awareness of the value of business continuity, and
intensified security concerns spurred by both business factors and
regulatory necessity. Even as the U.S economy has slowed down, the
market for managed hosting has grown, even for small and medium-sized
As this market has expanded, providers have had to adjust to other
trends centered around the way their customers deal with business
software " most notably, the growing adoption of Software as a Service (SaaS)
and the continued adoption of platforms serving as both exchange points
and facilitators of new online services, the Tier1 report said. Other
services that providers are being asked for by their more
forward-looking customers are e-discovery services, managed messaging
and IM, managed VoIP, managed databases, and managed application
services such as SAP (and other ERP and CRM solutions).
The leaders in terms of sales in this market are Rackspace US Inc.,
SAVVIS, AT&T and Verizon Business, with a host of competitors,
including Peak 10 Inc., OpSource, SunGard, Terremark Worldwide and
ViaWest, trailing them. To set themselves apart in a crowded field,
providers employ strategies such as automating the provisioning of
hosting services and catering to vertical markets" needs to combat
competition and establish market share. In order to compete
effectively, some providers, like their customers, must outsource
services that are not their core competencies and pay attention to
achieving the best balance between customer service, price and
additional fixed operating costs.
"There will be continued jockeying and consolidation in the managed
services sector as larger storage companies continue to eat up smaller
backup-and-recovery service offerings, and encroach more on the
territory of managed hosters," said Antonio Piraino, senior analyst at
Tier1 Research and author of the report. "Similarly, virtualization,
security, compliance, virtual computing and storage and international
expansion will all drive expenditure in the next year."
Key Services and Features
A basic list of services offered by a managed hosting provider might include the following:
IDS and IPS with Complete Reporting to the Client
An IDS (Intrusion Detection System) detects unwanted manipulations of systems, mainly through the Internet. An IPS (Intrusion Prevention System)
monitors network and system activities for malicious or unwanted
behavior and can react, in real-time, to block or prevent those
There are advantages and disadvantages to host-based IPSes compared
with network-based IPSes. In many cases, the technologies are thought
to be complementary. These two security technologies help ensure the
safety of hosted sites from external attack.
Custom Firewall and Router Configurations
A firewall"s basic task is to regulate some of the flow of traffic
between networks of different trust levels. Routers are used to direct
and forward information from those networks. The configuration of these
devices requires detailed understanding of the network applications and
endpoints required for day-to-day operations.
Spam and Virus Filtering
The use of spam-filtering software can limit the amount of
unsolicited email that makes it into corporate email boxes, and virus
filters help ensure that documents sent as email attachments do not
contain viruses or Trojan horses that can be use to bring down the
system or extract data from it.
Patch Updates with Full Client Reporting and Auditing
Patches are pieces of software designed to update or correct
problems with other software and can aid in usability and performance o
f the application. Managed hosting providers often take over the task
of developing a strategy for managing patch updates.
Scripts are distinct from the core code of applications, which are
usually written in a different language. Because they are accessible to
the end users, they enable the behavior of applications to be adapted
to the users" needs. Scripts are nearly always embedded in the
application with which they are associated.
In-House and Outsourced Monitoring
Monitoring application performance is vitally important, especially
fore-commerce sites. While hardware monitoring is fairly
straightforward, keeping tabs on how efficiently software is running
can be a bit more involved, requiring the provider to run management
applications of its own to examine throughput and performance.
Local and Remote Data Storage and Backups
Managed hosting facilities have storage capacity in the form of storage devices arranged as SANs (storage area networks),
and some sell exclusive access to dedicated SANs. They also maintain
geographically dispersed facilities where data is mirrored for business
continuity and backup purposes.
The DNS (Domain Name System) associates
various information with domain names; perhaps its most well-known
function is the translation of Web site URLs into IP addresses. The DNS
also stores other information, such as the list of mail servers that
accept email for a given domain. Managed DNS services allow users to
set up dynamic DNS using their own domain names.
In order to get optimal resource usage, throughput and response
time, providers use load balancing to spread work between multiple
computers, network links, CPUs, hard drives and other resources.
These items are certainly not the only services offered. Managed
hosting providers usually allow you to select the software you want
installed on your server. This includes the operating system, database
and specific applications. Servers can be customized and tailored
specific to the customer"s needs and requirements.
The hardware configurations available from different providers can
vary widely, making it incumbent on you to understand your needs before
engaging with them. For example, Rackspace offers five basic
configurations (including three based on Dell servers), all of which
are extensively customizable. The company also offers a "green" option
for all five as well. Hostway offers three configurations, each based
around a different server, with data transfer rates that range from
250Mbps to 1000Mbps.
If you want full flexibility in picking a hardware setup, The
Planet.com Internet Services Inc. offers 30 different server
configurations, plus five backup configurations. You can usually order
a machine running
Microsoft Windows Server backed by an SLA (service level agreement) or choose among a variety of open-source software platforms. Linux is generally offered for free.
In addition to the operating system, most hosting providers offer a
raft of preinstalled server features, including Web applications,
e-commerce tools and reporting capabilities.
It will pay in the long term to asses your specific needs " and to anticipate the needs growth will require.
The services offered by various providers can also vary
dramatically. For instance, Terremark Worldwide offers two different
levels of management support, differing in levels of monitoring, device
fail-over and coding support, plus managed services for storage and
backup. INetU Inc. offers two levels, Primary and Enterprise, for both
Red Hat Linux and Windows.
Again, it is very important to understand your specific needs and to
work with vendors to determine which package of services they offer and
at what cost. Making an apples-to-apples comparison isn"t easy, but the
investment of time to match your company"s needs and management
desires with providers" packages and prices can save you dollars in the
short term and major headaches as your computing needs change.
Most dedicated servers are packaged with a control panel, a set of
Web-based automation tools that help automate the process of Web site
creation and server management. Control panel software is installed on
the dedicated server and is integrated with Web servers, database
applications, programming languages, application deployment and server
administration tasks. The software includes the ability to automate
tasks via a Web-based front end. Control panels should not be confused
with a full server-management solution by a dedicated hosting provider.
Like with colocation services, dedicated-server customers benefit
from shared resources to get higher levels of Web performance and
security. They can select their bandwidth and have redundant power and
However, they do not have the flexibility of completely controlling
their own hardware and software. Still, dedicated servers can be a
smart choice for companies that want straightforward and reliable Web
hosting without the high up-front costs of purchasing their own
Managed Hosting Costs
Dedicated-server costs are a little different, in that you usually
select a plan that covers what kind of server you want, its processing
speed, memory and monthly data transfer, all for a set cost.
Basic machines with a 40GB hard drive and 500GB of data transfer can
cost as little as $100 per month, while premium machines with 4,000GB
of data transfer can cost nearly $1,000 per month. That"s why it"s
important to know ahead of time what your hosting needs will require.
Of course, you can always add more servers as your needs grow, but
the cost of renting and maintaining them can run high over the long
Checklist: What to Ask Before You Buy
Before you sign up with any hosting provider, you should take the
time to ask the following questions. They will help you determine not
only whether colocation or dedicated-server services are right for you,
but also if the provider can meet your particular needs.
- Do I have the hardware and software I need to host my site? If you don"t, ask if the hosting provider has the specs you need.
- Do I have IT expertise on staff, or do I need outside support? This
question will help you determine whether you need managed or unmanaged
- Does the provider offer unmanaged services, managed services or
both? Even if you plan to do most of the maintenance yourself, it helps
to have some on-site support.
- What do the provider"s managed services entail? This is an
especially important question if you are looking for more than just an
occasional server reboot for support. Providers will frequently offer
to monitor your servers and applications, and this monitoring can be
well worth purchasing. Make sure you obtain a copy of the provider"s
SLA so it"s clear what degree of service downtime the company promises.
- Will I have access to the monitoring interface? If you choose to
have the provider monitor your servers, make sure you can access the
monitoring interface, and make sure the provider can train people in
your company to understand the interface. There"s no sense in paying
for something you can"t understand.
- How much do dedicated servers cost, and how much support can you
get for them? If you don"t have the capital to buy your own equipment,
or you don"t already own it, you will want to budget out the cost of
dedicated servers and support.
- How much does the provider charge for space and bandwidth? When
asking this question, you should also inquire about whether the
provider offers multihomed bandwidth and "meet-me rooms" where you can
purchase extra bandwidth if necessary.
- How much power comes with the space I"m considering? If you want to
pack in a lot of high-powered servers, you may find that you need to
rent more space to get the power you need.
- Will I rent space and bandwidth on a monthly or yearly basis? You
may be able to get a discount by paying up front for a full year.
Remember, even though hosting providers advertise set fees, you can
- How much traffic does my site receive, and how much is it likely to
receive in the future? You will need to know this to estimate bandwidth
needs and the costs associated with them. Managed Web hosting is a
realistic option only if you have a site with high-volume traffic that
needs a dedicated server. For many small to medium-size Web sites, it"s
not a cost-effective solution in the
- Which hosting plan is right for you? Do the space, power and bandwidth specs fit with your needs?
- What kind of uptime guarantees does the provider make in its SLA?
It"s important to know what kind of service and support you will
receive for your investment.
Since managed hosting providers offer a wide variety of solutions
for businesses looking to move their Web-hosting functions off-site,
it"s essential to review your technology needs, budget and growth
expectations before signing up for a service plan.
While the variety of hardware, software, power and space
considerations can be daunting to the nontechnical executive, a few
chats with providers can clear up most of the questions you may have.
It"s also worth asking other companies about their hosting experiences
and for advice.
And don"t forget to thoroughly research the providers you are
considering to make sure they are certified datacenters with
high-quality networks. Unfortunately, there are some rogue facilities
with patchy connections out there, and obviously, these should be
avoided at all costs.
At the end of the day, you should see greater site performance and
consistent uptime rates at a lower cost than you would pay for in-house
hosting. You also have the added bonus of having your equipment safely
housed in a third-party location, just in case there is ever an
emergency at your place of business.