Web Hosting Interview - Parallels (formerly SWsoft) January 2008

January 2008
Web Hosting Interview - Parallels (formerly SWsoft) January 2008

Serguei Beloussov, Chairman and CEO of Parallels (formerly SWsoft)

This month we talk to Serguei Beloussov, Chairman and CEO of Parallels (formerly SWsoft), a company focused on virtualization and automation technologies whose products help power the web hosting industry. Those of you with your own websites might be familiar with the Plesk web hosting control panel... those of you with your own web hosting company might also be familiar with Virtuozzo, Sitebuilder, HSPcomplete, PEM... the list is seemingly endless! We ask Serguei what the current challenges are in catering for the web hosting industry and what's in the pipeline.

  • HOSTSEARCH: Serguei - very pleased to be able to meet you like this. It is really good of you to agree to us interviewing you. For the uninitiated, could you give us an overview of SWsoft, which recently changed its name to Parallels, and its history?
    SERGUEI BELOUSSOV: We founded the company in 1999 and have grown with a combination of homegrown and acquired technologies. Today, we are a global leader in virtualization and automation software that helps service providers, as well as businesses and consumers, optimize their use of technology. Our software is used by more than 700,000 customers in 125 countries. The product line includes Virtuozzo - the leading operating system virtualization solution, Parallels - the leading desktop virtualization product, PEM, which we're renaming Parallels Automation and Plesk - the leading server automation software. We have offices throughout North America, Europe, and Asia to serve our customers around the world. In December, we announced the renaming of our company to Parallels and our plans to integrate our broad portfolio of multi-platform virtualization and automation software.
  • HOSTSEARCH: Perhaps you could give us a bit of your own personal history - you are the founder of SWsoft?
    SERGUEI BELOUSSOV: I am one of the founders and serve as the CEO of SWsoft, while also providing input to the development process and our marketing initiatives, which is a combination that I think is very similar to many other fast-growth software companies. When I grew up in the Soviet Union, people had a choice between a technical profession or going into politics. I chose science - particularly physics, like my parents, which I felt would prepare me well for the real world, because it teaches you to understand how things really work. For example, the physical models I built during my training helped prepare me for business since it taught me to be very analytical in approaching things.
  • HOSTSEARCH: SWsoft offers a massive range of products on the market - can you give us a brief overview of each one and its purpose?
    SERGUEI BELOUSSOV: Parallels System Automation is a customizable data center solution that allows service providers to deliver almost any type of service and software application. Its modular design and flexible architecture allows providers to expand their system to include new services and scale to several millions of customers. The solution is a key component of our company's SaaS strategy.

    Parallels Business Automation streamlines core service delivery processes and provides a customizable workflow engine to manage and automate back end systems and processes, such as ordering, account management, billing, invoicing, trouble ticketing and fraud control. It uses web-based storefront and management control panels to help service providers rapidly launch new services, implement promotions, provide web-based online account management and integrate service delivery systems.  

    Virtuozzo is the leading virtualization solution for hosting providers. Virtuozzo operating system virtualization software uses patented technology to create multiple, isolated containers - on a single physical server and operating system, making the most efficient use of hardware, software and other resources. Each container has the same functionality as a stand-alone server and can be managed with Plesk, third-party control panels or in-house systems.

    Plesk is the leading multi-platform control panel designed to meet the needs of small to large hosting providers, resellers and end users. With patented hosting technology, the software is easy to use and automates a large number of tasks that allow service providers to reduce operating costs while increasing efficiency, profitability and customer satisfaction.
  • HOSTSEARCH: Given your contribution to the industry and everything SWsoft has achieved, what would you say has been the company's biggest success?
    SERGUEI BELOUSSOV: All of our products are part of our unified vision of "Optimized Computing" so we really only see success in the aggregate, for all of our solutions in total -- not as individual pieces.
  • HOSTSEARCH: With Plesk powering a major portion of the industry's servers SWsoft is clearly one of the leaders in the area of web hosting control panels. There are though of course numerous panels on the market. What is the emphasis as far as Plesk is concerned? How does Plesk differ from other control panels? What are its main benefits?
    SERGUEI BELOUSSOV: Plesk delivers complete server management and a comprehensive set of features. The Plesk Customizable Desktop feature delivers a professional looking interface that allows providers to access key functions from a single screen -saving time and money. Most importantly, Plesk is part of our Parallels Open Platform (formerly called the SWsoft Open Fusion) technology initiative. It is intended to improve integration among a wide range of systems, third-party applications and modules, and custom and in-house solutions. The Parallels Open Platform enables optimized delivery of SaaS and traditional hosting services to help independent software vendors and service providers take full advantage of new opportunities in the market. The Application Packaging Standard (APS) is a key element in this initiative and provides a format for software applications running on hosting platforms.
    Over time, this means that providers using Plesk will have an easier time integrating new features and migrating customers.
  • HOSTSEARCH: Virtuozzo is a technology that has helped fuel the Virtual Private Server revolution in web hosting. It has also helped drive change by providing a platform for software-as-a-service (SaaS). It strikes me that beyond the obvious you are not working in an area where you can just run some focus groups and send the results to the human factors guys to get your next product. How do you manage development and innovation in such a rapidly changing environment? How do you manage the process of finding products people do not even know they need yet?
    SERGUEI BELOUSSOV: First of all, I credit our talented engineering group where we have many brilliant, hard-working people. Then, I give credit to our hosting partners who help drive our development priorities with their feedback describing what they think would drive more revenue from their business.
  • HOSTSEARCH: SWsoft is always in the news for one initiative or another. One initiative I hear about often is OPEN FUSION. Perhaps you could talk us through this... What's the intention behind it?
    SERGUEI BELOUSSOV: Parallels Open Platform (previously called Open Fusion) is our company's technology initiative to improve integration among a wide range of systems, third-party applications and modules, and custom and in-house solutions. The platform enables optimized delivery of SaaS and traditional hosting services to help ISVs and service providers take full advantage of new opportunities in the market.

    Last June, we introduced the APS standard -- a key part of our Parallels Open Platform technology initiative. It creates a common hosting platform for SaaS applications that can be used by the global ecosystem of software vendors, service providers and their customers. Today, the APS standard is backed by SWsoft and 1&1 Internet and gives ISVs looking to sell their applications with access to more than 10 million potential customers. We are excited to see more and more application vendors embracing the APS standard to tap into the expanding market for hosted SaaS applications.
  • HOSTSEARCH: You obviously work very hard to work closely with web hosts and provide them with the support they need to be successful, but you have players like Microsoft supporting web hosts with SharePoint and similar initiatives, both Microsoft and Yahoo! offering web hosting solutions, and Google making its presence felt. What are the challenges and opportunities that emerge when such big players enter the arena?
    SERGUEI BELOUSSOV: All this means that hosters need to provide more sophisticated, personalized, as well as customized service. I don't believe that Google is a friend to hosters with specific programs to help hosting providers increase their hosting revenues, while Microsoft actually is a channel-oriented company, so despite some competitive offerings the company can be considered a friend for hosters.
  • HOSTSEARCH: Is there a chance that the big boys will swallow web hosting or will the current web hosting model always exist in one way of another?
    SERGUEI BELOUSSOV: We do not believe that the big boys will swallow hosters, or at least it is not going to happen soon, but hosters need to stay on their toes and pay attention. Our objective is to help grow the overall hosting business because that contributes to the vitality and growth of our customer base. Our efforts around SaaS are aimed at growing the hosting industry to take on a more important role in the delivery of value added applications in addition to the infrastructure solutions they provide today. While we remain humble about this, our hope is that it has some positive effect on the overall growth of the hosting business.
  • HOSTSEARCH: You are based in Virginia, but I understand you have programmers based in Moscow. What are the advantages of this arrangement?
    SERGUEI BELOUSSOV: Our development work is done in Moscow and Novosibirsk, Russia because we attract highly talented engineers. In particular, we have a unique working arrangement with the Moscow Institute of Physics and Technology where a number of employees went to school, including myself.
  • HOSTSEARCH: Serguei - I think you are in a unique position to answer a question we ask everyone we interview. What's the next big thing to hit the Internet and how will it impact people's lives?
    SERGUEI BELOUSSOV: We think SaaS (Software as a Service) is going to be a big deal. That is, SaaS and in general all of IT moving off premises to online datacenters, which we believe is the next big thing. It is already happening gradually, but the big change will be when a significant percentage of business IT gets moved, let's say 25-plus percent. And we believe, hosters represent the ideal new distribution channel for software and IT services.
  • HOSTSEARCH: Being in charge of such an important company, I can imagine if you are not careful, it could easily swallow you whole if it were allowed to. How you maintain the balance? What sort of things do you enjoy when you are not Chairman and CEO of such a high profile company?
    SERGUEI BELOUSSOV: My hobby is starting and managing businesses. It's all about having fun, and business is my fun -- along with my family of course. I enjoy the fact that the work is challenging and it's been fun overcoming the challenges we've met. When I do get the chance to do something outside of work, I enjoy nature and going camping into the mountains in different parts of the world -- whether that is in the Alps or Colorado or Siberia. Being outside is nice, but then again, going out to eat and enjoying some nice red wine is not so bad either.

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