Netcraft Uses Computers to Estimate Market Valuation of Web Hosts

Released on Thursday, a new Netcraft study has found that with more web-facing computers visible, a hosting company will get a higher market valuation.

Using the market capitalization (or acquisition purchase price where it applied) as a valuation, Netcraft found that the average value of each web-facing computer is about $43,000.

Take an example, in the managed hosting market, each web-facing computer at Rackspace is valued twice than that of Peer1. This reflects Rackspace’s value of Financial Support and Open Stack cloud.

By using the computer counting method, Netcraft found that the value of Amazon’s hosting division, Amazon Web Services, is about $7.8 billion, around 6% of its entire market value. Recent estimations by Morgan Stanley said AWS could reach $24 billion in revenue by 2022, while analysts at Quartz said AWS revenue is around $2.4 billion this year.

Paul Mutton of Netcraft said in a blog post that due to the quality of physical hardware, the network infrastructure, sales and support staff, especially the current and future revenue, and profit that each web-facing computer can make, the valuation of a hosting company may vary, even with the same number of web-facing computers.

Mutton also said the number of web-facing computers does not include the number of computers used behind the scenes, which could vary from different hosting providers depending on the business model.

As for Go Daddy, its valuation is $4.1 billion, greater than expected from its number of computers, Mutton said. Its role as the largest ICANN-accredited domain name register can be the reason.