What Effect Will Windows 2003 Have On The Hosting Industry?

As announced by Microsoft on April 24, 2003, Windows 2003 Server is now generally available. This means hosting companies will be starting to offer the Windows 2003 operating system as an option to their clients.

Digex said, in a press release on April 24, 2003, that they would have “immediate availability of Microsoft Windows Server 2003 within the Digex Managed Platforms service line.” Other hosting companies that were contacted have not been so quick to give a time when they would have a Windows 2003 package available.

It is yet to be determined if security concerns over the operating system are the reasons behind no official release date being given for new servers using the new operating system or not. There is no doubt that everyone has questions about the security of the new software release.

Last year alone, there were many different viruses and worms that propagated though Microsoft’s operating system, causing millions of dollars worth of damage, including Nimda and Code Red. Everyone in the computer industry is now wondering if Microsoft has gotten the security right.

Microsoft has said that Windows 2003 Server is shipped secure. The reason the product is said to be secure by Microsoft officials is because in default configuration IIS (Internet Information Server) is disabled. Web hosting companies will have to turn on the web server to serve web pages for their clients. The big question is if the software will still be secure once the web server is turned on.

Security might be on every ones mind but hosting companies are also looking for the cost savings promised by Microsoft.

Microsoft has announced a new Web Edition with the release of the Windows 2003 Server. There are no Client Access Licenses (CALs) and the cost is significantly less at a price of $399. The price tag for the Standard Edition is $999, which is the same as it is for Windows 2000, says Microsoft’s Windows 2000 site. With a $600 dollar per server savings, the hosting industry will start seeing more competitors in the budget-hosting segment with servers running on Windows 2003 Server; a segment now only containing a handful of Windows hosts.

Servers running open source operating systems like FreeBSD and Linux currently fill the budget hosts segment of the market. Microsoft has seen this as an issue for a while now and is expecting the addition of the Web Edition to allow more budget hosting packages on the Microsoft operating system.

The trend for non-Windows based hosting companies to start deploying services based on the Web Edition of the Windows 2003 Server has already started thanks to Microsoft’s new licensing and pricing structure. One such company to announce plans to start selling servers with Windows Web Edition is RackShack.net.

RackShack.net has been a RedHat Linux and Cobalt Raq shop since they were started but they have posted on their site that they would be releasing, on May 1, 2003, prices for systems with “Windows Web Edition powered by Ensim.” While requests for comments sent to RackShack.net were unanswered in time for publication, posts on their users forum have said the cost of the Windows operating system was the reason behind them not having Windows dedicated servers in the past.

The real test for Windows 2003 Server will be if developers will want to rush to it or not. Microsoft said they have made some major stability changes to IIS 6.0, which ships with Windows 2003 Server.

The developers that were contacted to see if they were rushing to get their hands on Windows 2003 Server did not have definitive answers. One developer said “I have not had much time to even look at the differences so I cannot give an answer to that question.”

One thing is for sure; Microsoft has released its Web Edition of the server to compete against the open source alternatives. Now Microsoft just has to hope developers will bite at the chance to get hosting for about the same cost as the open source alternatives.