Jilted Web hosting customers: AT&T wants you

The company is wooing customers of C&W, Sprint and others

AT&T Corp. today launched a high-profile campaign to woo Web hosting and Web services customers of former competitors Cable & Wireless PLC, Sprint Corp. and others.

In an announcement, Bedminster, N.J.-based AT&T said it will target those customers because C&W and Sprint separately announced earlier this month that they are leaving the hosting market in the U.S. (see story).

AT&T will sweeten its deals to prospective new clients with flexible financing options, free installation, expedited contracting, service assurance guarantees and aggressive pricing under the Hosting Transition Program being offered to businesses and government agencies, the company said. Also featured will be an advertising campaign aimed at the customers of departing hosting companies.

Chuck Sanders, vice president of hosting and managed services for AT&T, said today that the efforts are starting immediately and have already brought new customers into AT&T's fold. "We've had many customers come to us, like C&W customers, who've seen the writing on the walls," he said. "This is our moment to move up the stack."

AT&T will offer Web hosting, application hosting, data center redundancy and "end-to-end infrastructure" for customers under the program, Sanders said.

Betsy Bernard, AT&T's president, said in a statement that the company's "first priority is serving customers who already are stranded or fear that possibility as providers turn off the lights in their Web hosting facilities.

"While others are scaling down their investments or even abandoning this space, AT&T has forged forward and fundamentally integrated our Internet Data Centers into our networking architecture," she said. "That gives us tremendous economies of scale, as well as the flexibility to offer a valuable set of services, options and capabilities to companies whose hosting and 'net' applications are the lifeblood of their business."

Andrew Efstathiou, an analyst at The Yankee Group in Boston, said this is a good opportunity for AT&T to go after customers seeking a new provider. "This underscores AT&T's commitment to the business," he said. And since the company recently expanded its data center system, including new facilities in Hong Kong, France and Australia, it now offers more flexibility and security for potential customers.

"It's obviously a benefit for the customers themselves because they know what to expect," Efstathiou said.

Stephen Lane, an analyst at Aberdeen Group Inc. in Boston, said he thinks AT&T has a "good chance to succeed" in its efforts to sign up new clients, if the company can harness economies of scale as it provides new services. In the past, AT&T hasn't always been successful in its forays in system outsourcing services.

"On the other hand, they do have a lot of depth and breadth in at least running their own [IT] infrastructure, so maybe this time they'll get it right," Lane said.

Laurie McCabe, an analyst at Summit Strategies Inc. in Boston, said AT&T's "opportunistic" strategy is also being mirrored by other hosting competitors as they all vie for new accounts in a tough marketplace.

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