Web Hosting and Cloud IaaS to Converge, Rackspace, Savvis Lead Hosting Magic Quadrant

By David Roe (@druadh20) Jan 6, 2011

The recent release of Gartner’s Magic Quadrant for Cloud Infrastructure as a Service (IaaS) and Web Hosting has underlined the disruptive effects the evolution of cloud computing is having on the Web hosting market.

For the past five years Gartner (news, site) says the market has been moving towards on-demand infrastructure that is offered on a flexible pays-as-you-go basis. The majority of users obtain at least some of their infrastructure on demand, while most new web hosting contracts include some level of on-demand services too.

IaaS and Outsourcing

While the web host market continues to grow, especially for internet and intranet web applications, the rise of cloud computing is radically shaking this up with cloud-based IaaS expanding the number of use cases that IT buyers are considering outsourcing.

Currently, the three most common use cases for outsourced hosting are:

Self-managed IaaS: For cost effective agile replacement of traditional data center infrastructure
Lightly managed IaaS: For users who wish to self management but want the provider to be responsible for routine operations tasks
Complex managed hosting: For users who want to outsource operational responsibility for the infrastructure underlying Web content applications

The result is ongoing change in the vendor landscape that is providing significant opportunities for new entrants and considerable competition for older, more established players.

IaaS and Hosting

Gartner maintains that by the end of this year 25% of the hosting market will be accounted for by IaaS. Most IaaS will be delivered on virtualized systems. However hybrid architectures that combine virtualized resources with dedicated servers for resource intensive needs will still be common.

Two types of users moving to outsourced hosting

Traditional web hosting customers, who have a website, application or enterprise application that needs to be hosted externally.
Those interested in what cloud computing is able to do for their business. They begin with pilot projects but intend over time to move some, if not all, of their data center infrastructure to the cloud.

IaaS, Web Hosting Convergence

In response to that there are two different markets at play — but only for the moment.

The market for traditional web hosting, which is quite mature with most web hosters having a high level of operational reliability and reactive support
The IaaS market, which is “highly immature” and evolving rapidly

While IaaS reliability is still good, the rapid evolution of technology through the stack from hardware to applications is driving a level of change that provides management challenges for service providers as well as customers.

Providers may release several updates every quarter making it difficult to pick a vendor based on existing offerings. Service and support are also variable from provider to provider.

Both these markets will converge fully within five years, Gartner says, but for the moment most providers offer both traditional web hosting and cloud IaaS on two different platforms. The future will see a single unified architecture with multiple tiers of service quality. The multiple platforms in use today are a reflection of current immature technology.