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Blackout boosts Web outsourcing firms

This week's power outage in San Francisco has many Web firms looking outside the Bay Area for their Web-hosting needs.

This week's power outage in the San Francisco area has given Web-hosting companies new ammunition for pitching their services to potential customers that experienced difficulties during the blackout.

"At least two customers that had dormant proposals [to host sites elsewhere] called us after the outage," said Vaughn Harring, spokesman for GTE Internetworking, a hosting firm.

But nobody moved faster than one new customer of Exodus. When the customer lost its power, it loaded its server into a company truck, drove 30 miles to Exodus's hosting facility, and was back on the Net before power was restored to its own building.

Like other Web-hosting firms, GTE's sales force is using the outage in its marketing, hoping to sway companies that lost crucial functions when the power went down for as many as seven hours in some parts of San Francisco on Tuesday, affecting more than 375,900 customers and at least 1 million people.

"As a result of the power outage, we are considering more redundancy and hosting at other locations, but this was part of our plan from the beginning," said John Stormer, vice president of marketing for North Point Communications, a provider of high-speed communications services.

"You sort of get invigorated by something like this," he added. "We are prepared for earthquakes and power outages, but we continue to bolster that capability. Part of the strategy would be to put either redundant servers or outsource."

North Point currently outsources some functions to Web hoster Best Internet--but not its mission-critical network-management software, which it ran from its own San Francisco site on auxiliary power when the lights went out. North Point will keep that software in-house while it may turn its extranet for partners and resellers over to Best.

Web hosting services like Best, GTE, Digex, Exodus, and Verio, which is acquiring Best, have backup power systems, multiple connections to Internet backbones, and sometimes duplicate servers hundreds of miles away, all in an effort to guarantee uninterrupted service.

Hosting firms call outsourcing a company's servers "co-location," and Best Internet sales director Dayton Keane says the San Francisco outage is only the latest in a series of natural disasters to raise the firm's visibility among companies now hosting their own Web sites.

"This is part of a string of events that sends a signal," said Keane, whose company has gone from fewer than 100 co-located sites a year ago to 220 today.

San Francisco-based comparison-shopping site CompareNet, for example, kept its Web site in operation during the blackout because it was hosted at Frontier Globalcenter in Sunnyvale, California.

But many companies worry about turning over sensitive data or mission-critical functions to an outside company. Mortgage broker HomeShark went down for three-and-a-half hours Tuesday but plans to set up a mirror site on its own rather than outsourcing.

"We like to keep the information in-house to ensure privacy and security," a spokeswoman said, noting that loan applications include sensitive personal data entrusted to the company.

To address that concern, often raised by prospective customers, Exodus created a secure "vault" with heightened physical security, bulletproof structures, biometric scanners to gain access, and steel gauge conduits for wire, said Sam Mohamed, Exodus executive vice president.

"It is indeed like a bank vault," he said, noting the Internet credit card issuer Next Card hosts its site with Exodus.

Many large companies already have duplicate locations to keep critical services operating. The ATM networks of both Wells Fargo Bank and Bank of America were affected in areas with no power Tuesday, but online banking and Web sites for the two banks were not affected. Both have duplicate servers at distant locations.

And outsourcing isn't for everyone. Palo Alto law firm Cooley Godward had its email and phone systems disrupted for a few hours because they are housed in San Francisco, but client services manager Kate Fitzgerald said the firm is not looking at outsourcing.

"We actually handled this situation very well. This was definitely a test of our emergency systems and consequently a wake-up call to see if we are really ready," Fitzgerald said.

Sites for CNET: The Computer Network, publisher of, and Snap went down for a while during the outage.

"The company has looked into co-location in the past and we are currently looking into co-location as well," a CNET spokeswoman said.

A Snap spokesman made similar comments: "We have been building redundancies, and we're going to continue to do that."