Indian hosting providers were always perceived as cheap re-sellers but that seems to be changing now as private equity flows into this vertical. Madison India Capital has invested 15 Crores in Net4 India Ltd – a listed hosting provider in India. This deal might seem insignificant in terms of amount invested but is a major one for Hosting space in India.
Net4 India has allotted fresh 16 lakh equity shares to Madison India Capital HC at Rs 87.76 per share at a discount of 40% from the high’s touched in 2008. The share allotment constitutes roughly 9% of Net4India’s equity capital.
Net4 primarily serves Indian Corporates with their data centre and content delivery demands. The company lacks footprint in retail hosting and has been attempting to attract SME’s with cheaper plans.
It provides services like Corporate data centers, VoIP, Website hosting, Corporate email accounts solution and domain name registrations. It also owns 7 data centers and is ICANN accredited domain name registrar in the country.
Foreign hosting providers like Rackspace, Godaddy, Network Solutions, Akamai(major clients include moneycontrol) has been attracting clients from India due to their service reliability and wide array of solutions.Some foreign providers are even looking at opening India based data centers so as to serve growing demand.
Many Indian portals are now turning to Indian based content delivery networks so as to lower the ping time to their country audiences at the same time improve rankings for country based searches. Major Indian hosting providers include ZNET,Reliance Data Center(division of RCom) and TATA Communications(earlier named VSNL).
While wanting to sound appreciative of the focus and impetus to Indian hosting service providers, I am surprised at the target here. I’d rank other Indian service providers a tad higher than Net4. They have questionable sales and service practices, which is seen as an uphill climb to establish and reclaim customer and shareholder credibility.
my two cents worth
I think net4 is already a big company and for a big company its always easy to attract investors, while small companies very rarely get investments. Investors always go for better and safe companies.