2. Introduction Many different types of ‘hosting’ Virtual server and traditional websites/email –Smaller companies or organizations that do not need a large web presence. Collocation servers and application hosting –Larger organizations Managed server hosting –Middle ground

3. Research Question What are the strategies for generating revenue from a hosted networked environment?

4. Concept Provide mid-sized company with: –Rack space –Bandwidth –Technical support –Server management –Insurance –Relationship with datacenter

5. Market Analysis Market Segmentation: Geographic Location –Located within King, Pierce, Snohomish, Skagit and Whatcom counties Close proximity to property This may not be the case (unknown variable) Company Size –Small and medium sized businesses –Contain between 10 - 100 employees

6. Market - Geographic Location Number of business entities by County - 2004

7. Market - King County & Revenue

8. Target Market Strategy Businesses not currently using managed servers Small companies that want to upgrade Companies that currently house their own servers Temporary hosting environments

9. Competition There are many ‘hosting’ companies. There are no competitors that offer to managed the clients’ computer Only a handful of companies offer platform independent server hosting. –They own the server - not the customer Competitors (In Seattle - include): –Adhost (owns their own datacenter) –Internap (based in Atlanta)

10. Total Business Process How to get the product to the customer? Pre-production –Research Vendors Datacenters with available space Startup time for new account –Establish relationships Proof of insurance –Develop product Platform Support HR requirements

11. Total Business Process Pre-Production (Continued) –Develop price structure –Develop contract structure Production –Sales & Marketing –Customer setup Find rack space Sign contracts with data center and customer Install Server –Invoice Customer

12. Total Business Process Post-Production –Customer Support –Relationship Maintenance –Hardware upgrades –Platform upgrades –Continue to negotiate low data center fees

13. Financial Overview Income: –Rack is 42 units –1 unit is ~$140 - ~$230 per month –Rack income = $5,880 - $9,660 per month

14. Financial Overview Expense (per month): –Full Rack costs ~ $675 –Bandwidth ~ $200 –FTE (20%) ~ $1,070 –Insurance ~ $30 –Non-earning rack units (electricity, appliances) ~$80 –Indirect Costs ~ $2,000 Total Expense (estimated): $4,055

15. Financial Overview Income$5,880 - $9,660 / month $70,560 - $115,920 / year Expense$4,055 / month $48,660 / year Net$21,990 - $67,260* Assumptions: The rack is full of paying customers (best case) Does not include marketing expense

16. Questions?