Cloud Hosting: Hostway Attracts $110 Million in Funding

Hostway Corp., which specializes in web hosting and cloud hosting services, has attracted $110 million in financing to support a “continued growth plan.” The deal is the latest example of (A) a web hosting company attracting money and (B) a web hosting company trying to search engine optimize around the cloud hosting term. Here are some quick details for managed services providers.

Launched in 1998, Hostway provides dedicated hosting, shared hosting, colocation, domain name registration, ecommerce solutions and other Web-based services to over 1.4 million Web sites and 600,000 customers worldwide. Veronis Suhler Stevenson along with Fortress Capital, Regiment Capital and Phoenix Life were involved in the latest round of funding.

So, where does cloud hosting fit into this picture? The company in 2008 launched a Cloud Server effort, which mainly leverages Microsoft’s Windows Server and SQL Server database — though Centos and Red Hat Enterprise Linux also are supported.

Hardly surprising, most of the major hosting firms have been adding some cloud language to their marketing and financial promotions in recent months. From publicly held hosting firms like RackSpace to privately held companies like The Planet, the race to recruit VARs and resellers into cloud hosting partner programs also has intensified. And yes, Hostway has been promoting a private label program to partners.

Still, differentiating in the hosting space has becoming increasingly difficult. Some firms, such as Verio, have pushed beyond Hosted Exchange and other traditional Microsoft options to introduce hosted SugarCRM, an open source CRM system that competes with Salesforce.com.

We’ll be watching to see how Hostway invests its latest round of funding.

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