A detailed reflection on whether we have become the biggest hosting company in the Czech Republic. Are we the biggest hosting in the country or not? We think so.
Only 31 months to the top
Thursday 11. April 2013, we believe the historical tables were being rewritten. We think we have become the biggest hosting company in the Czech Republic. Let’s take a look at this result, which we achieved in an incredible 30 months and 29 days (just over two and a half years).
In our opinion, we beat (in most parameters) companies that have been on the Czech market for more than 15 years.
The fastest growing in the market
Since launching our service offering in the autumn of 2010, we have been at the top of most growth charts. In practically all parameters, we have been growing the fastest in the long term and always with a relatively large lead over the others.
For illustration, you can look at the graph of the growth of the number of .CZ domains that we operate as an accredited registrar.
Where we are (not) the biggest in the Czech Republic
We are undoubtedly the greatest in the following areas:
- growth in all parameters (number of registered domains, number of hosted domains, number of VPS)
- the largest Czech operator of active .CZ domains (i.e. domains with an active website and functional e-mail) = active web hosts)
- data transfers between classic hosting (i.e. between web hosts and VPS operators)
- high-capacity storage for backups
- the fastest growing turnover from our services on the market
What we are not the greatest at (yet):
- domain registrar
- total number of domains (including parked domains) pointing to us
- annual turnover
- number of employees
- advertising costs
Notes on the different areas of evaluation
We will describe the different areas of assessment and try to write small notes on them.
Domain registration
Among the accredited registrars of .CZ domains, we are currently ranked 5th and 2nd for .EU domains. We will soon be ranked 4th for Czech domains. The other ranks are more distant, but all are achievable for us. Statistically speaking, our growth clearly indicates that we will move to 3rd place within a short time. If we can maintain our growth rate, we will definitely reach the top in a few years.
We sell domains at purchase prices and so they are not a source of income for us. From our point of view, they are therefore only a ranking in the registrars’ rankings. It makes no sense for us to subsidize this activity in any substantial way (other than through our work, domain administration development and fees to national registries).
We don’t compete in domains and we don’t want to go “by force” of big profits. Until a few days ago one of the registrars subsidized (for 16 months in total) domains with a profit of 35 – 75 crowns without VAT. Thanks to this, it was the only registrar that kept up with us a bit, but their profits must be in the millions of crowns. Did they help each other?
So we are happy with our current position, but we want to grow further and we are doing a lot to do so. We’re improving our interface and adding more stuff to the administration. For example, last time it was exports in the administration or the ability to sort domains into folders.
We want to launch a few more domain extensions. We don’t want to compete on whether we offer 10 or 100 or 200 or 300 terminals. We want to offer only a few of the most popular endings that can be fully automated. The administration of all our domains is fully automated, which means minimal administration and thus minimal costs for us… At the same time, we bring comfort to our clients.
We are not planning any domain speculation or any auctions or domain snatching. No, we won’t do that and a decent registrar shouldn’t do that. It always runs the risk of running into a conflict of interest.
We do not plan anonymous registrations either. The complications and risks involved are great.
It is pleasing that most of the domains we manage as a registrar have some hosting with us – some paid service from our offer. It is clear that many clients perceive us as a hosting company and not as a domain registrar. Most clients come to us for quality hosting and not because of the low price of domains.
We have a positive balance with all registrars, i.e. in the long term, significantly more domains move to us than from us elsewhere. This is an argument that says a lot about the quality of our service.
Our pricing policy for domains, i.e. the purchase price for registration and for renewal will be maintained in the future.
Domains – DNS record keeping
All our domains can use our DNS servers. We have a high quality, reliable, fully automated and completely online DNS administration. This makes our DNS administration very popular on the market.
Our DNS servers are exactly according to the RFC, which is not quite common and in the Czech Republic you can count on your fingers…
However, we certainly do not want to compete in this area, because the administration and provision of DNS servers is completely free of charge, so we leave everything to natural development. This natural evolution of the number, i.e. The growth in the number of domains using our DNS servers closely correlates with the growth in the number of domains we manage as a registrar.
In the official statistics of CZ.NIC, which concern .CZ domains, you can find us in the Nameserver hosting table on the 3rd place and we are constantly moving up…
Web hosting including parked domains
In the same statistics, but in the Webhosting table, you will also find us at 3. Instead. However, this is not some real number of hosts, but the sum of all domains that point to the IP addresses of a particular provider. This statistic also includes domains that do not have active hosting, but are just parked with the provider or are operated by someone else on the provider’s server.
There are domains parked with us, but their number is smaller than the number of active domains. Our share of parked domains in the total number of domains directed to us is smaller than that of the largest companies in the statistics. Why? We see several reasons for this. The first is that we have historically fewer domains parked. We have historically had fewer speculative domains. At the same time, we do not serve purely as a registrar (and subsequent parking until the project starts), but most customers order our web hosting at the same time. Because of our hosting, customers choose us for their domains.
Webhosting – real working domains
In the CZ.NIC statistics you can also find the Mailhosting table. Yes, we think these are real and genuine paid hosting. It is the table that tells the most about the number of real (live or active) services.
This Mailhosting (this is by the number of MX records for each provider, which is plus or minus the number of active web hosts) is ranked as follows (as of April 11, 2013):
Google 36739
Ignum 35262
WEDOS 33492
forpsi 33426
Active24 28453
We overtook Active24 already in winter. FORPSI just 11. April 2013. Google has a lot of active services for mail because they have historically had Google Apps for domains completely free. However, this popular service has been charged for and so growth has stalled. We’ll catch up in about a month and a half. Ignum automatically sets up an MX record for each registered (and parked domain), but most of those domains are not activated on the mailserver at all (try to send something there 🙂 ), they have less active hosts than we do.
We assume that most active paid web hosts also have email with these providers. So there is no doubt that we have the most active web hosts for .CZ domains and we are growing the fastest.
This statistic is one of the most valuable and one of the most important for us. This statistic is one of the most important for our income and future profits. Web hosting is the most important income for us and the most important source of future profits. It is the same with all other hosting companies.
VPS virtual servers
Among root VPS operators, we do not know of any such significant competitors in the Czech Republic that would operate thousands and thousands of active root VPS. Every day we add more and more virtual servers.
It is our second most important source of income. Virtual servers are very important and essential for us. We are constantly working on improvements.
Dedicated servers
We have a very limited range of dedicated servers. We want to narrow our offer even further, but at the same time we plan to grow in this area. We will soon reveal how we intend to achieve this.
We rented some servers. Subsequently, we reduced the offer because this service did not bring us as much economically as we would have liked. We are preparing a new offer. We will see how attractive our offer will be for clients. We are still testing and debugging. We will then make a final decision and if we want to focus on dedicated servers, you definitely have something to look forward to.
If we launch the new offer, we are going to make our presence known on the dedicated server market as strongly as we do in the web hosting and VPS market.
Housing
We had planned for housing, but it was the area that made the least economic sense to us, so we changed our original interests completely and never launched the bid. We save space for our interests (meaning servers and services) and at the same time, thanks to the absence of foreign servers, we have higher security of the entire datacenter and at the same time higher stability of services (network, electricity…).
We are considering these services in the future, but not until many years from now. We don’t know what will happen after that :-).
High-capacity storage for backups
WEDOS Disk – this backup service is popular with our customers. It is actively used by over 6 thousand clients. Yes, some of it is free as a bonus to other services, but we also have a large proportion of paid ones. Users back up their entire servers or even entire companies to us.
In terms of the number of active standalone storage facilities for backup, we probably have no competitors in the Czech Republic, but we see large reserves here and this service could be very interesting (and very important for our company) in the future.
Turnover
We’re not the biggest in turnover, but realistically we’ll be on 3. or 4th place in the Czech Republic among hosting companies. Currently, our turnover is around CZK 4 million per month.
Why aren’t we the biggest in this area? It’s simple, because our services are significantly cheaper than those of other competing companies.
Turnover is not an essential measure for us. We are going the way of minimizing all costs and thus even with a smaller turnover we can achieve profit and in the future the highest profit in the industry. Our services are fully automated, all servers are energy efficient and the entire datacenter is extremely efficient (we claim the most efficient in the whole country). From this perspective, turnover growth is a secondary measure for us.
Data transmissions
In the area of data transfers, we are around 3 Gbps. This clearly puts us in first place among web hosts (and VPS operators). What does that prove? This is proven not only by the fact that we do not restrict data transfers, but also by the fact that we host many websites and servers and that these are also large and visited websites.
Compared to other competitors in the web hosting or VPS industry, we are several times larger than other companies. We also outperform companies that do housing and host dozens of other hosting companies on their premises.
Staff
The number of employees is a measure that is called. double-edged. A small number of staff means you can’t do your services properly, there is no substitutability and no specialisation. Having a large number of employees means you have high labour costs, which can be a big problem when there is a lot of competition.
There are currently 15 of us. We’ll be hiring more staff soon and will be 17-22 of us (we’ll see how we like them 🙂 ). We do not plan further leapfrog growth. We are going down the road of selecting quality workers on the one hand, and at the same time absolute automation on the other. In terms of number of employees, we are 4th among the hosting companies. place in the Czech Republic. On the contrary, we are at the top in terms of income per employee. It should be noted that most of our staff are dedicated to the development and evolution of our services and only a minority are dedicated to the management of existing services. For the operation of the services alone (without development and business) we would need about 7 people. Automation is automation 🙂 .
Advertising costs
In terms of advertising costs, we are one of the more economical companies and so we spend significantly less on marketing than other companies on the market (per customer).
Hosting in general as a concept – we are the largest in the Czech Republic
From 11. April is therefore (based on the above arguments) the largest hosting company in the Czech Republic. If anyone has a different opinion, they can contact us and convince us otherwise. In the event that someone demonstrably disproves our claims, we will wait for our entry to the top. Given the market conditions, it won’t take that long anyway.
Is it essential to know who is the greatest?
Is it relevant to state that you are number one in the market? It is and it isn’t.
On the one hand, it’s a meaningless item. On the other hand, of course, it is a good marketing tool. Similar information sells well. It’s part of the psychological struggle. It also affects employee morale and stability. It’s also part of the competitive struggle, andit certainly looks better when you tell clients to move to the biggest hosting company rather than 29. company in the industry.
Of course, it is also said that “winner takes all”. Two or three firms in a market can prosper well. Others are standing still and have no means to develop. Other companies must cease operations.
Similarly, you can see the importance of the parameter that assesses the growth of individual firms. This is probably more important than the ranking itself. Why? Who grows the fastest clearly shows its dynamism, attractiveness of the offer and quality of service. Of course, growth must be reasonable, proportionate, because excessive growth is also very dangerous.
However, the quality of service is much more important and therefore whether or not we are the biggest is not the most important measure for us.
A note at the end
Last week we reached out to several of the largest companies to get their client counts, mainly active hosting, mailhosting and virtual servers. No response. We haven’t heard back from either company. We don’t think that we want anything secret or something that someone would have to keep secret. Yes, our intention was obviously clear to everyone – why we were asking. Yes, if everyone gave us exact numbers, we could amend our claims or even have others convince us that we are not the biggest. Or, on the contrary, we would have everything officially confirmed by all the other major players on the market and our claim would be confirmed. They certainly didn’t want to admit defeat…
Some active companies do not communicate with us and prefer to send a report to the authorities. So maybe we’ll see another denunciation… 🙂
Let’s see if we can generate some discussion.
Note: After the article was published, Ignum wrote to us to say that they would not provide any figures on client numbers.
Acknowledgements
Finally, I would like to thank all clients for their trust so far. I thank all employees for their dedication to the company. Finally, I also thank all the readers for their patience in reading this essay exercise. You only get to the top once so it’s worth a recap! In any case, we must now redouble our efforts so that we do not rest on our laurels.