Telus renovates “the bunker” to host Web sites

Telus has renovated two properties in Toronto and Calgary as part of its effort to reinvent itself as a national player in the managed hosting space.

The company Tuesday said the data centres will help it fulfill a $200 million e-business hosting contract with the federal government while serving private sector customers like National Life Assurance, Hewlett-Packard Canada and Harry Rosen.

The $25 million, 80,000 sq. ft. Toronto centre is a converted 30-year-old warehouse which Telus said could be expanded to 150,000 sq. ft. The $22 million Calgary location already has an IT pedigree, having housed computers for the 1988 Winter Olympic Games. Telus bought the 130,000 sq. ft. building, nicknamed “the bunker,” from TransCanada Pipelines and rearchitected it to build in redundancies.

Craig Richardson, Telus’s director of national product marketing for hosting solutions, said the data centres represent part of the $75 million the company has invested in its Web hosting strategy this year. Like AT&T Canada, which last month purchased Toronto’s Bird On A Wire Networks, Telus wants to offer a broad spectrum of enterprise IT services, including hosting. The company reorganized some of its business units earlier this year under the Telus Enterprise Solutions banner to focus more cohesively on these markets.

“(Telus Enterprise Solutions) brings together a lot of the pre-existing capabilities within Telus which allow us to deliver not only just basic networking services, but give us the ability to add other capabilities as well,” Richardson said.

For example, Telus could offer a custom system integration SAP, PeopleSoft or J.D. Edwards implementation for a customer, and then leverage that to offer a new set of ASP services, like streaming media or enhanced e-mail.

Toronto and Calgary were chosen for their proximity to major corporate customers, Richardson added. This is an important factor for Telus, which is trying to break through perceptions about its ties to the West Coast.

Mark Quigley, an analyst with the Brockville, Ont.-based Yankee Group of Canada, said the Toronto centre could put some customers’ minds at ease.

“It certainly does put them in a nice position in that they will have a tremendous amount of real estate to offer,” he said. “The thing to remember is that the market is young, it is growing. I don’t think it’s something that will show tremendous overnight success.”

Telus recently signed an agreement to purchase the Canadian assets of PSINet. If that deal goes through, it will bring the company a second Toronto hosting facility and 50 points of presence across the country.

Richardson said the entrance of telcos into managed hosting represents a significant challenge to pure-play hosting providers.

“You’re going to want a company that is financially stable, who can draw upon resources from across the organization,” he said. “In a lot of ways that’s going to differentiate Telus from some of the others.”

Quigley said Telus is wise to get in the game early, adding the PSINet deal could put the firm into a market leadership position in Canada.

“For a company like Telus, it is vital that they offer these types of services,” he said. “If they’re competing with an AT&T or a Bell for a national account, if they can’t offer that kind of service, that could very well be the deciding factor.”

Richardson said the data centres will offer colocation services, though customers have said they want Telus to take on more responsibility for managing full solutions.

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