CRN Interview: Joel Kocher & Tiffani Bova, Interland

As a provider of hosting services targeting the SMB market, Interland is determined to defy conventional wisdom that hosting can only be profitable on a large scale with consumer services or global 2000 customers.

Interland CEO Joel Kocher and Vice President of Sales and Channel Programs Tiffani Bova explain in an interview with CRN Editor In Chief Michael Vizard that channel partners are key to unlocking a wave of opportunity in providing managed services to SMB customers.

CRN: More than a few companies have failed in the hosting space. Why will Interland succeed where other companies have failed?

Joel Kocher: We've been working very hard for two years now to build a scaled hosting business. As you know, there have been a lot of high-profile failures in our space. But we've been on a very aggressive acquisition program that we completed last year, and we delivered on a long-standing promise to deliver a profitable business in the fourth quarter ending last August.

CRN: How did Interland make that happen?

Kocher: We believed that the enterprise-level hosting opportunity was not a place we wanted to play. So if you look at where a lot of the high-profile failures have been, it's in that extremely high end,what I would call custom solution space,where with every single customer you almost start from zero. What we decided to do was to create a scale business around standardized solutions and cater to small- and medium-size businesses. So we have one solution with a manageable level of customization so that our customers get the benefit of much lower prices because we're scaling one solution across many customers and we're not in the situation of having to manage 97,000 different software implementations.

CRN: How does a VAR make money in this model when they previously installed the LAN on the customer's site that you are now trying to eliminate?

Tiffani Bova: The biggest challenge for VARs right now is, how do they create a revenue stream for their business that potentially could be recurring? The VAR business today is, you install a LAN and wait for a break/fix call. So you have got to go find another small business to install a LAN. With our approach, they can build up a base of business that can deliver them revenue so that they can grow that base of business vs. looking for that one new sale every month.

CRN: How is the VAR program doing?

Bova: Last year we increased our actual reseller community in our shared business by almost 1,500 participants, so we're now at 8,800 resellers in our shared environment. The dedicated reseller program rolled out late last year.

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