Web Hosting Interview - Macquarie Hosting March 2008

March 2008
Web Hosting Interview - Macquarie Hosting March 2008

Aidan Tudehope, Managing Director of Macquarie Hosting

Recognized as a center for technological development and a business and commerce hub, over the last couple of decades Australia has experienced unparalleled economic growth. With a strong domestic market to cater to, and proven ability to compete in global markets, the Australian web hosting industry is vibrant, healthy, and certainly never been stronger. We catch up with Aidan Tudehope, Managing Director of one of Australia's leading web hosting providers, Macquarie Hosting. We ask Aidan about web hosting in "God's own country" and find out what the future holds.

  • HOSTSEARCH: Aidan - thanks a lot for this interview... Very much appreciated. Perhaps we can kick off in our time-honored fashion with you giving us an overview of your role and responsibilities within Macquarie Hosting.
    AIDAN TUDEHOPE: My role is Managing Director of Macquarie Hosting, the managed hosting division of the Macquarie Telecom business. I was co-founder of Macquarie Telecom and have been a director since 1992. My role as Managing Director, Hosting is to drive growth and operational efficiency in the hosting business and maintain a constant focus on delivering the highest levels of personal, accountable service to all customers.
  • HOSTSEARCH: Perhaps you could tell us a bit more about your parent body, Macquarie Telecom. When did your hosting unit begin, and what percentage of Macquarie Telecom's activity do you represent?
    AIDAN TUDEHOPE: I think it's important to confirm first up that we don't have a parent body, Macquarie Hosting is a subsidiary of Macquarie Telecom, one of Australia's leading suppliers of Information and Communications Technology solutions.

    Macquarie Telecom's services including voice, data, mobile and hosting and we specialise in the business and Government markets.

    There are two key services in our strategy for the hosting business - leadership in hosting of online critical applications for interactive media, digital media and digital content developers, and gateway and secure hosting for Government customers.

    The hosting business plays an ever increasing role in the Macquarie Telecom business overall.

    There is no denying, telecommunications is moving to hosted services and the future of telecommunications is based on IP and servers - hosting is central for IP VPNs, hosted-VoIP, Unified Communications offerings etc.

    A number of telecommunications carriers have dabbled in this space but few have been successful in establishing their services. As we are number one in the Australian managed hosting market we are in a particularly unique position - no other telecommunications carrier has been able to diversify and succeed in this approach.

    Success in this market has Macquarie Telecom poised for further gains as the Intellicentre evolves as the heart of the business.

    Business and Government customers are beginning to realise the benefits of working with a telecommunications carrier for their hosting requirements. What this means is that customers have a single end-to-end provider and SLA for all aspects of their hosting solution - network, infrastructure, managed services etc.

    Macquarie Hosting has numerous local, international and Federal Government customers, including the likes of Fairfax, Showbiz.com.au, Total Travel, NRMA, Webjet, PBL Media, News Ltd, National Water Commission, Haymarket Media and Authentium.
  • HOSTSEARCH: What sorts of services does Macquarie Telecom provide?
    AIDAN TUDEHOPE: Macquarie Hosting's service offering covers the full breadth of hosting options from secure collocations to dedicated hosting, enterprise virtualisation and government services.

    In terms of specialisation - the last few years have seen us working with an increasing number of customers in the interactive media and digital content space. We've recognised the need for specialised dedicated managed hosting and virtualised solutions to help these companies cope with the rise of content rich applications and 24/7 demand. In response, we have been focusing a significant portion of our activity and service offering on meeting these needs.

    Similarly, with growing security requirements being imposed on Government and private sector organisations, we're noticing a trend toward customers sourcing providers with proven accreditation in this market e.g. Australian Defence Signals Directorate Certification, ISO certification etc. We've focused our service offering heavily on specliaisation in this area, with our data centre, the Intellicentre recently achieving the highest level of certification offered by the DSD - full gateway accreditation to the level of highly protected and restricted, making it the most highly certified data centre in Australia.

    For our Government and enterprise customers, the DSD accreditation offers assurance that the data centre Secure Gateway provides protection from external threats appropriate for systems and data up to and including the "Highly Protected" level of classification.
  • HOSTSEARCH: From your website, I note that Macquarie Hosting offers managed dedicated hosting and managed collocation services. Why did you stop at these services rather than go the full 'shared' ... 'VPS' / 'managed' / 'dedicated' route?
    AIDAN TUDEHOPE: Customer feedback was the primary driver behind this decision.  

    The Macquarie Hosting team takes a very hands on approach to managing customer's mission critical applications. Customers can be assured they will always have access to a person to manage their enquiries and needs - it's part of Macquarie Telecom's commitment to delivering Personal Accountable Service.  

    This is what customers want and, in response, we've found they don't want a shared environment. More and more they are happy to virtualise within their own environments but they want to maintain direct access with their named account manager and engineer, hence our chosen approach.
  • HOSTSEARCH: So, are you a utility type service, with people paying for hosting through their telephone bills?
    AIDAN TUDEHOPE: No, we're not a utility type service at all; we're a personal, accountable company.

    Our offering is unique in that all aspects of a customer's business telecommunications services can be viewed on the same bill - this includes traditional voice, IPTel, PABX, Mobile, Mobile Data, all aspects of data networks and all aspects of hosting and firewalls.

    We provide customers with a single consolidated invoice across all services and carriers. Billing and reporting is tailored to complement the customer's business structure and cost centres.

    The advantage for our customers in the Macquarie Telecom business model is that we saw the convergence of telephony, data networks and the need to have servers to manage all of these coming very early. As a full-line carrier we were able to simplify the management process for our customers on this front and our billing system reflects this. That said, we're not a utility type service.
  • HOSTSEARCH: Tell us something about your Virtual Dedicated Server Hosting service.
    AIDAN TUDEHOPE: As I mentioned earlier, we specialise in working with interactive media and digital media companies, digital content developers and companies whose online applications are mission critical to their business.

    One hundred per cent web facing, these companies are dependant on web presence for communication with their various publics; these businesses require specialised flexible, agile and scalable technology to keep pace with demand.  

    In response, we developed the Macquarie Hosting Complex Managed Hosting and Virtualisation platform for Web 2.0 companies.

    The solution is designed for online digital media and high-availability transaction based companies that need to manage unpredictable peaks in internet and mobile traffic - locally & globally and require high availability and responsive network access 24 hours a day, seven days a week, 365 days a year.

    The Macquarie Telecom Complex Managed Hosting and Virtualisation platform gives these customers the rapid scalability and on-demand bandwidth they require, without the need to invest in additional hardware.
    Some of the organisations using the Macquarie Hosting Complex Managed Hosting and Virtualisation platform for Web 2.0 Companies include; Fairfax Business Media, Haymarket Media, PBL Media, News Limited, Loop Mobile, Showbiz.com.au and WebJet as well as overseas organisations including Authentium and Habbo and Government departments such as the National Water Commission and Prime Minister & Cabinet.

    Beyond meeting the need for rapid scalability of these organisations, the virtual dedicated server offering also fits with our overall 'green' strategy as an organisation.

    The past twelve months has seen the hosting business embark on a green journey, taking a practical approach to improving our energy efficiency and reducing energy consumption in the data centre.

    Part of this approach has seen an increased focus on working with customers to virtualise their environments, an approach that has had a proven positive impact on reducing energy consumption.

    At the end of 2007, we took another firm step on this journey, committing to greening our supply chain and partnering with vendors with proven 'green credentials' in the market. Sun Microsystems is one such vendor, also specialists in virtualisation technologies, and in December last year we selected Sun Microsystems as our preferred data centre supplier for servers following a complete procurement review based predominantly on 'green' criteria.

    The move is expected initially to improve efficiency of our data centre energy consumption by more than 650,000 KW per year which equates to over 600 tonnes of CO2 emissions, according to Energy Australia, another clear indicator of the strategic value of virtualisation within our hosting business offering.
  • HOSTSEARCH: There seem to be a lot of telcos around the world that have ventured into hosting, and on the face of it, there's an immediate fit with VOIP and this type of service.  Step back a bit, and you can see hosting is a far cry from traditional telco services. Can hosting suit all telcos? Isn't it a bit of steep learning curve?
    AIDAN TUDEHOPE: It is a steep learning curve, yes - especially when you take into consideration our leadership and specialisation in hosting for digital media and interactive media companies.

    From the outset the hosting business was aimed at corporate IT.

    Because we jumped on the trend toward convergence early and had already begun integrating data, voice and mobile services into our offerings, building servers and the hosting business in as well was fairly logical in the initial phase.

    Specialising in the digital media space was the bigger step and steeper learning curve.

    It's a considerably different customer base to corporate IT companies with very specific needs and requirements. The Macquarie Hosting team has invested significant time and resources in understanding and accommodating these needs.

    The style of critical applications for interactive media and digital content companies means they require technology solutions that are flexible, agile and scalable for them to keep pace.

    As part of a select group of global hosting providers in the VMware Service Provider Program, Macquarie Hosting was in an ideal position to provide these scalable platforms so customers can quickly increase server capacity to cope with peaks in traffic without the need to invest in additional hardware.

    Where we have invested time is in working with relevant bodies and organisations representing these customers, like the Australian Interactive Media Association, so as to get a better feel for the needs and requirements of these organisations.

    Through these associations we are not only playing an active role in promoting the growth and success of Australia's interactive media industry but also keeping abreast of the rapidly changing specialist hosting requirements of these organisations and ensuring our complex managing hosting solutions for Web 2.0 companies remain relevant.

    A number of telecommunications carriers have dabbled in the hosting space but few have been successful in establishing their services. In the Australian market in particular, it is unique to see the number one spot filled by a telecommunications company with such a broad range of Government and business customers

    Specialisation aside though, the overarching requirement for companies that choose hosting is end to end security for their data - something Macquarie Telecom's experience as a full-line provider sets us up to provide.

    As a telecommunications carrier, Macquarie Telecom's hosting customers experience the benefits of working with a single end-to-end provider and SLA for all aspects of their hosting solution - IP VPN and 3G network, infrastructure, managed services etc.

    As a result, these digital media, interactive media and digital content companies can rest assured that when it comes to the crunch and immediate action is required for any component of their solution; they are dealing%
  • HOSTSEARCH: What is the advantage of getting hosting services from a company with strong telco connections like Macquarie Hosting?
    AIDAN TUDEHOPE: From the customer's perspective, having one point of contact for all their telecommunications, data, mobile and hosting requirements is a significant advantage.

    Ease of management and a consistent standard of personal, accountable service is maintained. Similarly, working with one provider, prevents finger pointing or a lack of accountability from suppliers when it comes to the crunch.

    As I mentioned previously, the stand-out benefit for customers in sourcing their hosting services from a company with a telecommunications background is that they are working with a single end-to-end provider and SLA for all aspects of their hosting solution - IP VPN and 3G network, infrastructure, managed services etc.

    As a result, customers can rest assured that when it comes to the crunch and immediate action is required for any component of their solution; they are dealing with a single service provider committed to delivering the highest level of service.
  • HOSTSEARCH: Does Macquarie have a research and development unit? Can we expect any major web hosting initiatives from your labs? If so, without giving the game away, what will they be?
    AIDAN TUDEHOPE: Macquarie Telecom's investment is in our processes, people and accreditation.

    We leverage other company's technologies, research and development to deliver innovative solutions to our customers that meet their business needs.

    For example, by partnering with the likes of Sun Microsystems who invest heavily in the development of energy efficient server technology and VMware who specialise in virtualisation, we are well equipped to leverage their expertise and R&D in these areas to deliver 'green, energy efficient' managed hosting solutions to our customers.

    In terms of further investments and initiatives, we will continue investing in metering and monitoring to a granular level across the Intellicentre to further improve our own energy efficiency, identifying where our power is going and how we can better manage it.

    Similarly, we'll continue to invest in educating our team on 'green best practice', arming them with the knowledge they need to further improve processes and approaches across our business and pass those benefits on to our customers.
  • HOSTSEARCH: This is probably a naive question, but is there anything intrinsically different about web hosting in Australia, or is it essentially the same business as it is elsewhere? Is there a defining quality that makes it Australian hosting?
    AIDAN TUDEHOPE: Intrinsically, hosting in Australia is the same as hosting anywhere else in the world.

    Addressing latency issues is probably a bigger focus for Australian companies though when it comes to their hosting requirements - another of the tyranny of distance issues we so often encounter down here.

    A number of Macquarie Hosting customers who would traditionally host their mission critical applications and websites in the US or UK have on-shored their hosting recently to address exactly these issues.

    Teen social networking site Habbo and security software as a service provider Authentium are just a couple of examples of international companies (based in Finland and the US respectively) who've chosen to host their content and applications for the Australian market in Australia so as to reduce latency and improve the user experience for their customers.
  • HOSTSEARCH: The Australian economy is booming, and its web hosting is on very solid ground. Just to what extent can Australian hosting penetrate international markets?
    AIDAN TUDEHOPE: Macquarie Hosting is already working with a number of companies headquartered in the US that have a strong Australian market presence.

    We believe this will be a continuing trend as there really is no limit for Australian hosting companies to penetrate international markets.  

    The speed to market offered via global IP networks means organisations are in a great position to identify and capitalise on market opportunity both here and overseas.
  • HOSTSEARCH: From the southern hemisphere you have a unique perspective on the world's Internet activity. What do you think is going to be the next big thing to hit the net and how will it impact people's lives?
    AIDAN TUDEHOPE: I think it's important to note that while some of our customers are in the consumer market we are a B2B company so insights related to trends or the 'next big thing' to hit the Internet will focus here. Thoughts though:

    - Proliferation of digital media and the integration of mobility and VoIP
    - Information anywhere will become a reality
    - Wireless networks will continue to be a high priority and business imperative/enabler

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