Tech Industry

Network Solutions looks to services

The company known for doling out Internet name addresses announces it is increasing its focus on services, building upon a small but growing part of its business.

Network Solutions is putting a new name on its services game.

Known for its pioneering work on a system for doling out Internet name addresses, Network Solutions announced today that it is increasing its focus on services, building upon a business that now comprises a small, but mushrooming, slice of NSI's overall revenue pie.

As it NSI nears the end of its domain name monopoly, it may be reaching into other pockets to supplement its wallet. Chances are good that NSI's reaching in the right direction: Revenue from its services unit increased by 50 percent in each of the last three quarters.

The Virginia-based company named Adam Zimmerman, a former manager for General Electric, to lead NSI's services unit, which it has renamed Internet Technology Services. The unit was previously called the Consulting Services division.

The beefed-up unit will focus on providing architecture, integrating Net technology within legacy systems, and offering IP engineering and managing remote access, firewall administration, and domain naming system services for large companies and ISPs.

NSI seems to be using the status it gained as the company that pioneered the development of registering coveted top-level Web addresses ending in ".com," ".net," ".org," and ".edu" to drive its fledgling unit.

"We're well-qualified to provide technical support because of our engineering experience in the domain name system and the Internet Protocol infrastructures," said Bruce Chovnick, senior vice president and general manager of Internet Technology Services. "That's why we're bringing the focus of our professional services in closer alignment with our core business of establishing an identity on the Internet."

Since 1998, the consulting services division added new offices in Atlanta, Los Angeles, and New York to increase local support for clients of its Internet and enterprise network services, NSI said. The company also has services offices in Charlotte, North Carolina, and Washington.

During Zimmerman's ten years of management experience at General Electric, he helped establish an Internet Electronic Commerce Service business at GE Information Services and led the development of several net Net-based services offerings designed for mission critical e-commerce via the Web.

For more than six years, NSI has had an exclusive contract with the National Science Foundation to run the allocation of top-level Net domains. Next year that contract will expire. Starting in April, five registrars will test NSI's shared registry, allowing the new players to directly register ".com" names and manage their customers' accounts.

But with robust earnings and a secondary stock offering under its belt, the company likely will continue to be a strong player in the domain space, even as it relinquishes its monopoly status.

Network Solutions' consulting services reported revenue of $3.3 million in the fourth quarter, up 47 percent from the previous quarter. It reported revenue of $8 million in 1998, a 22 percent increase compared to 1997 revenue of $6.5 million.

For the year ended December 31, 1998, NSI's net revenue was $93.7 million, an increase of 107 percent over net revenue of $45.3 million for the comparable 1997 period. Net income increased to $11.2 million or 67 cents per share, compared with $4.2 million, or 31 cents per share a year ago.