EIG and GoDaddy – Web Hosting Monopolies?
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Effects of Growing Web Host Monopolies
Earlier this week, the Boston Business Journal reported that Endurance International Group plans to hire 150 to 300 additional employees. EIG also predicts more acquisitions of web hosting companies in the coming months. Currently, they own more than 60 web hosts, including Domain.com, HostGator, and A Small Orange. Surprisingly, few bloggers have tackled what this expansion means for webmasters.
History of Endurance International Group
Launched in 1996, EIG has slowly acquired small to medium-sized web hosting companies. Their mission is to “make the web a better place” and “help small businesses succeed online and beyond.” Every acquisition continues to operate under its original name. In addition, they generally keep the personality and policies their company is built upon. Some former employees complain that EIG puts pressure on their acquisitions, encouraging them to become more profitable at the cost of customer service and new developments.
In 2011, EIG was sold for nearly $1 billion, and it’s now jointly owned by Goldman Sachs and Warburg Pincus. Since then, the company announced plans to hire hundreds of new employees at their Burlington, Massachusetts location.
Eliminating the Competition
Competition is a good thing. It encourages web hosts to earn customers by providing better or cheaper services. Without competition, the industry stagnates because it’s less motivated to improve. For example, Comcast and Time Warner have monopolies in the United States. Few people are pleased with their cable and Internet services, but they don’t have anywhere else to turn. When Google Fiber was introduced, Time Warner “randomly” decided to increase speeds within Google’s projected territories.
Endurance International Group has 3.7 million subscribers and 150 employees, which they may increase to 550 employees over the next half decade. In comparison, GoDaddy has 12 million subscribers and 4,000 employees. Clearly, EIG is still a small fry in the grand scheme of web hosting; however, both companies predict massive growth.
EIG and GoDaddy: The next Comcast and Time Warner?
It’s too soon to cry foul, especially with EIG. We should be skeptical of the company’s claim of rapid expansion. Going from 150 employees to 550 within five years is questionable and seems highly optimistic. The company recently went public, so they might benefit from people thinking their growth is happening faster than it truly is. Still, their long list of acquisitions, some of which are incredibly popular, speaks for itself.
People who are concerned about the growing monopolies can take action. There are highly reputable web hosts that have no affiliation with EIG or GoDaddy. Consider WP Engine or SiteGround, for example; they’re both medium-sized companies with amazing customer support and high satisfaction ratings. Although WP Engine solely handles WordPress blogs, SiteGround offers all standard web hosting services, including shared, dedicated, and cloud servers.
We’re fortunate to have the ability to bounce from one host to the next with minimal effort and fees. Take advantage of this by supporting the underdogs. When’s the last time you switched Internet providers for free, receiving a 30 day money-back guarantee and better service in the process?
Want to learn more about some of the web hosting companies we've mentioned? Check out our Web Hosting Reviews and Comparisons.