Search My Pulsant

How the UK hosting market differs from the US or Europe

Reading through a thick pile of this year’s reports on the Hosting market, I was struck by some of the distinctive features of the UK market.

As in so many other ways, the UK hosting market stands halfway between the typical European model of a mix of large telcos and a plethora of small companies offering a mix of connectivity and hosting, on the one hand, and the US market which is characterised by large numbers of pure-play hosting companies.

One of the characteristics of the UK markets is how cautious the IT community in the UK feels, especially relative to North America or Asia. Analyst reports talking about the IT sector transitioning from locking down costs to finding ways to grow revenues, as economies come out of recession. But UK IT executives are still much more focussed on cost reduction. “Having to do more with less” is cited as the most important issue facing IT departments by two thirds of UK executives. Much more so than in the US, specifically reducing the number of servers and increasing server utilisation rates are key issues for UK IT departments.

In the UK the downturn had a particularly hard impact on the hosting market. Its worth remembering that 90% of UK IT executives still report that the majority of their infrastructure is in-house. The UK, along with the Netherlands and France, are the European markets that are most receptive to hosting, but Europe as a whole is still far behind the US in terms of adoption of third party hosting.

The cautious sentiment in the UK extends to the adoption of cloud computing, too. UK IT executives have lower expectations than US or Asian executives for savings from adopting cloud computing. And UK IT executives are more cautious than their US or Asian counterparts when it comes to using enterprise-grade cloud solutions; a third of UK executives say they have no plans whatsoever to use such services. Its noticeable that, according to market analysts research, big US hosting companies like Rackspace and Savvis don’t yet have a dedicated cloud infrastructure in the UK.

So, although there is a sense that IT functions are moving from an agenda driven by cost reduction to one more balanced with broader business development, sentiment in the UK suggests that, for the hosting sector, this will be a gradual process rather than a sudden surge.

← Previous Next →
☷ View All Blog Posts