Interland to Become Web.com

Interland, a popular web site hosting provider that offers online services for small and medium-sized businesses (SMBs), Wednesday announced that it has completed its asset acquisition from Web Internet, LLC (Web.com) and Web Service Company Inc. According to a written statement, included in the assets are the domain name Web.com, Web hosting business comprised of approximately 9,000 subscribers, accredited registrar business and trademark rights. Interland paid approximately $4.8 million in cash, restricted stock and assumed liabilities.

As a result of this acquisition, Interland intends to change its corporate name to Web.com, Inc. The formal name change is expected to take place in the first half of 2006. The company said the name change is a "strategic move designed to clearly align the company with its branded line of business: offering Web services (including Web sites, Web hosting, and Web marketing) for small and medium-sized businesses and consumers."

"Acquiring Web.com is an exciting step toward increasing our market penetration. Web.com is an under-utilized asset that we can unlock to reach its full potential," said Jeff Stibel, President and CEO, Interland. "In addition to a tremendous branding opportunity, this acquisition adds revenues, significant direct navigation traffic, and an entrance into the consumer segment of the web hosting market."

Interland says the Web.com acquisition is anticipated to bring approximately $75K in monthly hosting revenues.

The company also says it intends to integrate Web.com's offerings and customers within Interland's infrastructure "to maximize efficiencies and cost savings." Current Web.com CEO, Will Pemble, will join Interland as an Executive Vice President and will focus on building Web.com's consumer and registrar business.

Rich Miller, who maintains a tech blog at Netcraft News, says, "The move illustrates the growing importance of branding in mass-market web hosting. As the web's largest hosting companies pursue small business customers, Interland has fallen significantly behind better-known competitors. Interland currently hosts 463K hostnames, down 57K from August, while Go Daddy (+600K hostnames) and Yahoo (+200K) have had huge gains in the same period."

Miller added that Interland's decision also reflects the increasingly prominent role of domain names in business strategy and the Internet economy.

Devin Comiskey is the Managing Editor of ECommerce-Guide.com.