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Agile Computing: Blog Post

What Yahoo Exiting Hosting and SMB / SaaS Means to Hosters

Pick a system that is built for your business and go to market fast to grab the opportunity

Yahoo is unloading Zimbra and with it the whole SMB hosting business. While the Zimbra part is interesting to us here at Open-Xchange, as it also shows some technology related weaknesses, the bigger picture may be even more interesting - especially to Service Providers.

Tier1's Phil Shih get's it right (as usual): "...Yahoo is also set to unload Zimbra, which Yahoo has had little success leveraging across its small business customer base, although it continues to grow. T1R does not agree that Zimbra had (or has) no hope within Yahoo because it is a solely enterprise-focused product, as some of the media commentary suggests. While Zimbra could be a bit up-market for the Yahoo Small Business base, there is no reason why the product could not have been tailored for the small business market. Or Yahoo could have at least leveraged some of Zimbra's technology and created a premium mid-market email product...".

While it would not have been easy to change the Zimbra enterprise product into something that works in a shared hosting environment, for somebody with the means and abilities of Yahoo it would have been doable.

We have spent the last three years developing a product tailored to the specific needs of Service Providers. Integration into existing email back-ends, integration into control centers, integration into the Parallels automation products, high-volume multi-tennancy, fail-over and backup for 24/7 operations are some hard requirements for such environments.

The Yahoo move is an opportunity and threat to Service Providers. Or, as Phil puts it: "...Yahoo's impending exit is some mildly positive news for hosters because it underscores the difficulty that Internet giants have had in becoming service providers – a transition the likes of Google, Microsoft, Amazon and Intuit must make if they are to be serious players in the hosting space..." - but - "...On the flip side, hosters will have to deal with a more focused rival if and when Yahoo Small Business is sold. An owner with the right vision could have a nice foundation from which to build a strong competitor...".

If you want, you can move now, without huge investments. Simply pick a system that is built for your business and go to market fast to grab the opportunity!

More Stories By Rafael Laguna

Rafael Laguna is Chief Executive Officer of Open-Xchange Inc., of which he was co-founder and chairman of the board until he took over responsibility as CEO in January 2008. In 2001, Laguna initiated the technology partnership between Open-Xchange's development team and SUSE Linux - today a Novell business. The result of this partnership, SUSE Linux Openexchange Server, became the best selling Linux-based groupware solution. Most recently, Laguna was crucial to the extention of Open-Xchange's product portfolio and formed the partnership with the world’s largest web host by known servers, 1&1 Internet AG.

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