Sorry Tier1 Research, We’re Sticking With the Niche

One of the things that I look forward to see at HostingCon is the latest research statistics. And you know you’ll be seeing plenty of research information when the presenter is a research firm. On the second day of HostingCon, Antonio Piraino of Tier1 Research delivered a keynote entitled, “Are you ready for Hosting 3.0”.

The teaser summary of the keynote states:

The second phase in hosting was exemplified by a shift to a broader set of services in the mass-market, driven by virtualization and automation… the foundation for what will become hosting 3.0, or the next phase in cloud computing. However, the hosting market is simultaneously splintering between public, private and enterprise cloud solutions, creating larger challenges for hosting providers to facilitate to these disparate needs. This brings with it a decision point for hosters: what is needed to adequately compete? How to create cost effective yet resilient and secure infrastructure solutions? Where to invest, who to acquire or how to be acquired? Join Antonio as he describes the State of the hosting industry, the simultaneous looming threats and opportunities that Cloud computing brings to the hosting market, and how to deal with them.

In the summary above, I bolded “mass-market” because there was a large focus on the mass-market and small to medium sized businesses (SMB). The SMB market is huge and research evidence shows that there are huge gains to be had by services that target this market. This SMB-focus was further reinforced by the third day keynote by the Executive Chairman of Parallels, Sergey Beloussov, and Parallels CEO, Birger Steen.

One of the takeaways of the Tier1 keynote was a recommendation to move away from being a niche-player and a call for hosting providers to move toward targeting the massive SMB market in order to capture some part of the large revenue growth that Tier1’s research is projecting in the hosting enterprise – the largest growth being in the managed hosting segment.

While I like to see all the research, I don’t have to agree with their conclusions and in this case, I do not agree that all hosts should move to focus on the mass-market. As Tier1 showed, the hosting enterprise is huge and there is room for all kinds of hosts that specialize in different segments.

Our mission from the very beginning was to empower .NET developers by providing innovative hosting solutions and anybody can review all the things we’ve been doing since 2003 and you’ll see we’ve been executing on our mission with laser-focus – we’ve never strayed from our mission. We believe that the .NET developer niche is a worthy segment in itself and deserving of a host that focuses on their needs.

And focusing on a niche doesn’t mean that we are not hosting SMBs. In fact, we reported in a previous research paper that about 2/3 of our customers host business-related websites with us. Just because we do not lead with an SMB message doesn’t mean that we are not an SMB host. So we are offering hosting for SMBs in our own way – by focusing on a niche and specializing.

Sorry Tier1 Research, DiscountASP.NET is sticking with the niche.

Takeshi Eto
VP Marketing and Business Development

3 thoughts on “Sorry Tier1 Research, We’re Sticking With the Niche

  1. Excellent Takeshi san.
    Splintering may well be the keyword.
    A quick 30 year review of where we have come so far will backup what you are describing. I’m reminded of many business related “shifts” that have come on strong but ignored the typical customer. 😉

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