Hostway Discloses Global Web Trends of Small- and Medium-sized Businesses

Hostway's 300,000 customers and four continental operations supply key developments and rising trends in the Web hosting industry.

Chicago, IL—November 1 , 2004—Today Hostway Corporation releases its report, "Small and Mid-sized Business Web Sites: Early signals and emerging trends." The company's report identifies the primary factors that triggered this year's upsurge in e-commerce investments by small- and medium-sized businesses (SMBs): a sizable drop in the cost of domain name registration, Web sites utilized as business resources, the global adoption of broadband, and easy-to-use site-management tools.

Domain name registrations escalated to 4.7 million this year, totaling 63 million names in existence - up 21 % from the first quarter of 2003 (VeriSign). One factor driving this surge is the low cost and availability of domain registration: Once costing $35 plus a two-year commitment, domain name prices now average $8 with a one-year commitment. The drop in domain costs allows SMBs to purchase multiple domain names and increase their presence on the Internet. It also prompted an increase in micro-scale Web-based businesses, where entrepreneurs experiment with highly specialized products. These businesses use the global reach of the Web to generate viable revenue.

"Today every business needs a Web site," said John Lee, VP of Marketing, Hostway. "With more people relying on the Internet as their primary means of communication, information and commerce, SMB owners understand the vital necessity of placing their businesses on the Web."

SMBs now weave their Web-based stores into their overall business communications with a better understanding of what sells - and what doesn't sell - online. In addition, SMBs use their Web sites as reference tools mimicking directories and brochure ware: Well-known and local businesses with frequently trafficked physical locations use their sites for customers to easily access information (i.e., locations, hours and menus). Lesser-known SMBs without offices or shops use their sites as their primary locations, providing information about their businesses as intended for first-time visitors.

Broadband connections account for more than half (51%) of the U.S. online population at-home as of July 2004 - compared to 38 percent only a year earlier. This translates into 63 million Web users connecting to the Internet via broadband at this time, a year-over-year increase of 47 percent. In addition, overseas SMBs now add U.S.-hosted Web sites to mirror their primary sites in their countries in order to improve Web performance in the States.

Day-to-day labors and limited personnel cause SMBs to rely on the new user-friendly and easily understandable Web hosting tools to get more value from their sites. Hosting sites now offer sales force automation tools, Q&A knowledge bases, and customer service operations. New hosting services in development include hosted PBXs, VolP, new ASP offerings, and personal information management. Ongoing developments in hosting infrastructures make way for a new generation of Web-delivered and Web-based service and business solutions.

"Ten years ago SMBs faced not only technical barriers in creating effective Web sites, but consumer skepticism and indifference, as well," said Lee. "Now SMBs are finding a much more favorable climate - from both technological and marketplace perspectives - as they use the Internet to grow and prosper."