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Monday, May 16, 2005

Hosting companies navigate transition from creating sites to enhancing features
Business New Haven

Tracie Mauriello

Jeffrey Cohen knew ten years ago that he had a knack for technology and graphics.

But if you told him then that he could combine them into a single career, he wouldn't have believed you. "I would have said no way. Those are great careers, but they're very distinct," Cohen says.

He would have been wrong.

Cohen now is an owner and vice president of one of one of the state's oldest Web hosting companies, ImageWorks in Vernon. Now that he's merged technology and graphics, he's adding marketing to the mix, too.

It takes a savvy business sense to compete in cyberspace now. Computer users have virtually unlimited options when it comes to choosing a host to provide storage space and bandwidth for Web sites.

Competition is made more fierce by new providers that spring up as quickly as old ones are swallowed by mega-hosts such as Yahoo and EarthLink.

Fees start at less than $10 a month and can top $1,000 for companies needing security features, vast bandwidth, integrated software and the capacity for thousands of people to log on simultaneously.

Some providers offer free sites to users who agree to display banner ads that generate revenue for the host.

The Web hosting industry began to boom in the late 1990s when companies large and small were trying to find their place in cyberspace. Now most companies are already online, so the role of Web hosts has evolved, too.

"Before, the hard part was convincing people they needed Web sites," says Jacqueline Lightfield, president of Blowtorch Studios in Norwalk. "The pitch now is that they need to be constantly updating and refreshing what they put on their Web pages."

The challenge now is for providers like ImageWorks and Blowtorch to distinguish themselves as full-service, responsive hosts who run their own servers and provide quick solutions to customer's problems. Experience, a solid client base and a good reputation help.

"If I had to start from scratch right now, though, it would be really, really hard," Cohen said. "This is not a growth market. It's very, very competitive now."
There's still room, though, for new providers serving a niche market, Lightfield says.
"You're best off if you can say something like, 'I want to go after the non-profit sector,' or 'I want to go after the bloggers,'" she explains. "You need to target yourself on a market or niche that's not being represented."

In Branford, Real Interactive's president, Dave Armenia, says the hosting market has matured at record speed. For most industries, it takes something like three decades for availability and prices to level off. For hosting, that's happened inside of ten years, he says.

"The initial boom in the mid-'90s was so great that you could charge anything you wanted - not that we did, but you could - because the demand was so high," explains Armenia. Then, some were paying hundreds a month for basic packages now available for $15 or $20 a month.

Now that costs have evened out, customers are no longer shopping for price. Instead, they're shopping for service, local Web hosts agree.

Some want design, maintenance and hosting. Increasingly, though, clients are becoming Web-savvy enough to design their own pages. Online tutorials and software programs make that even easier.

Still, the need for Web designers isn't likely to disappear any time soon.

"People designing their own sites like to manage their own communications - which is good," says Armenia. "But eventually everyone hits a snag for what they can do for themselves, so they look for someone to help them."

Orange-based Krell Industries designs its own site, but Lightfield provides the scripting and coding that makes it run.

"She's become a very valuable component in what we do," explains Renee Santhouse, Krell's marketing manager, who helped bring the high-end audio manufacturer online in 1997.

It would be difficult today to grow a high-tech business without being online, she adds.

"You really need to have a Web presence - especially if you have a highly technical product - because it means you're at a certain level of sophistication and people see that as relating to your product," Santhouse explains. "It would be odd not to have one."

Krell uses its site to provide technical information and photos in a flash.

"We know it's important for people to know what the back of the unit looks like because there are a lot of connections," she says.

Krell's 200-page Web site allows the company to provide a level of detail that wouldn't be practical in a brochure. "We're able to show large pictures and close-ups of everything," Santhouse says. "People are more attuned to receiving that kind of information now."

Krell's site also provides detailed information about warranties, product specifications, product manuals, support for product dealers and distributors, and even instructions for cleaning audio equipment.

As the Web world becomes more complex and less secure, more clients are looking for design and maintenance services, not just hosting. Experts can offer more innovation and more security than customers would have if they designed their own pages.

"Security has been one of the biggest changes" in Web hosting, Lightfield explains. "When I started doing this ten years ago, you didn't have to worry so much about hackers or viruses or worms taking over your system and trying to attack your server." Now you do.

It also helps to have an outsider involved in your Web design because "you have an external set of eyes looking at how it's going to appear to potential customers," says Lightfield. "When you develop something in-house you can be too close to it. You may not notice that you're using too much [insider jargon] that customers might not be familiar with.

Most smart companies understand the benefits of contracting with a designer, Lightfield says. "While I continue to host, it's not really the featured end of my business now. Mostly I get customers that want me to design or to consult on how they can improve their current Web site."

Technological advances mean that Web advertising is becoming much more sophisticated. That makes the work of Web hosts both fascinating and complicated, says Charlie Cocuzza, principal of Omega Communications in Southington.

There are more opportunities than ever to catch potential customers' attention. Businesses that don't take advantage of those opportunities will lose out to more progressive competitors.

"The Web has become the de facto Yellow Pages, but it's more than the Yellow Pages. It's a whole different animal," Lightfield says. "With the Yellow Pages, you have to figure out what category you're looking for and then you get names and numbers and not a whole lot more about what those companies do," she adds.
On the Web, people might not know exactly what they're looking for; they just want a solution to their problem, Lightfield adds.
For example, someone looking for lodging with wireless Internet access could go to the phone book and start calling hotels. Or, they could search online for "hotel, Wi-Fi and New Haven" and come up with exactly what they're looking for. Hotels that don't have Web sites advertising such amenities would lose out.

"It's a completely different advertising model that smaller companies and businesses need to be aware of and take advantage of," says Lightfield.

Meanwhile, aggressive Web hosting companies will be looking at ways to incorporate new technology to make Web marketing even better for their customers.

"Technology keeps evolving," says Cocuzza. "There's something new every 18 months. What's going to happen in the next 18 months is flashier Web sites and more e-commerce. You're going to see explosive growth in e-commerce. It's just going to keep getting bigger and bigger."

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