Messaging is getting hot for hosters and telcos

Nov 5, 2012

Guest Blog by Philbert Shih, Founder and Managing Director of Structure Research

http://structureresearch.net/about-us/Messaging continues to attract new players. Telcos are perhaps the biggest new constituency as they continue to warm up to the benefits of increasing ARPU, while enhancing stickiness.

Hosters looking to telcos as white label or reseller partners are not a new development. But the explosion in smart phones, growing Internet adoption and intensified telco competition, has created a renewed interest in messaging and by extension, hosted services.The growth of messaging is global and picking up in emerging markets.

Open-Xchange has done a fantastic job helping hosters penetrate the small business market and its technology powers the email for a large number of the world´s top hosters. In 2Q12 it added Endurance International and Poland´s NetArt to its list of hosting partners. Endurance was the big one. It joins Web.com and 1&1 as three of the top four hosters in the world (shared hosting) working with Open-Xchange. Endurance is crucial for Open-Xchange because of the remaining upside. The more hosters Endurance rolls up the more addressable email market it will have without expending resources to go after it.

Underscoring the power of a small business-focused technology, Open-Xchange seats now outnumber Microsoft Exchange seats at 1&1 ­ a very notable development. With consolidation in shared hosting accelerating, and Endurance getting even more aggressive with 3Q12 acquisitions of HostGator and Intuit´s hosting assets, we should expect its market share to climb.

We have spoken in the past about the beginnings of a shift beyond email and this continues to take shape across the sector. However the movement remains painfully modest. But this speaks to the pace and pattern of SaaS adoption: incremental and steady but with no out of line spikes. This is a function of several factors, including the nature of the IT refresh cycle, the lag between software updates and of course, the decision-making and on boarding process itself. Nevertheless adoption of SaaS continues to ramp.

Want to share your experience with messaging?

Contact me at ps(at)structureresearch.net to set up a chat at Open-Xchange Summit 2012.

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