Recently, Telus signed a letter of intent to purchase the Canadian operations of PSINet. On completion of the deal, Telus will obtain approximately 50 points-of-presence, or Internet connection facilities that serve most major markets in the country.
These facilities will include a state-of-the-art Internet data center in Toronto that the company will leverage to reify its position as a leading hosting position. "This transaction will strengthen Telus' position as one of the leading shared hosting providers in Canada by combining PSINet's Internet hosting business and data center with our existing hosting business and newly constructed, national Internet data centers," says Jim Peters, an executive vice-president at Telus. "If we can acquire PSINet's Canadian operations at a price that is cost-effective for us, we will accelerate our plans for national business Internet services."
Included in this plan is the rollout of an additional data center in Western Canada within under a month. Telus has also acquired the Canadian subsidiary of Williams Communications and most recently has forged partnerships with noted IT consultancies to enhance it hosting service provision.
All these developments indicate that Telus will be at the forefront of hosting in Canada and the rationale behind this prediction is three-fold. Firstly, the firm is an incumbent local and long distance exchange carrier in Western Canada.
Since the firm has a dominant position as a monopoly telecom service provider, it has access to a huge financial war chest. According to John Seliga, vice-president of hosting solutions for Telus, the firm intends to spend nearly $10 million in Canadian funds to rollout its integrated hosting vision.
Secondly, Telus can leverage Canada's cheaper and centralized infrastructure. With more inexpensive bandwidth available in Canada and with its own extensive network, Telus will be able to offer consumers more value by way of investment in value-added services rather than in expensive bandwidth.
Thirdly, the firm can offer its customers extremely competitive service. With Canada's currency hovering at the 60-cent range at U.S. exchange rate, Telus has the opportunity to offer its services competitive not only to a domestic but international market.
For these reasons, expect Telus to emerge as a dominant player in complex hosting, not only in Canada but also internationally. Further, expect the company's investment to spawn more competition from the likes of the Canadian subsidiaries of WorldCom and Sprint in the near future. website hosting
