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September 17, 2010

Q&A with Fabio Banducci, CEO, PEER 1 Hosting

CBR catches up with Fabio Banducci about YouTube, scaling and customer satisfaction

By Vinod

One of the reasons I was interested in talking to you today, Fabio, was I believe you were one of YouTube’s earliest technology suppliers. What can you tell us?
I’d be happy to. As is now well-known, I think, YouTube was set up in 2005 by three former PayPal employees who were very technically competent and so they were looking for full control of their infrastructure and initially only asked us for two servers down there in San Antonio. But, as of course is also just as well-known, that business just exploded and as the guys decided they needed to focus 100% on their core competencies and grow that business the relationship with us changed, too. They went to literally hundreds of servers with us in a very short period of time and looked to us for more and more back-end services. To me, that’s a key story both in terms of what smaller businesses can expect but also what is important from a hosting and co-location provider.

Fabio Banducci, CEO, PEER 1 Hosting

In what way? Are you saying all small firms could become YouTube-sized – that’s a bit fanciful, surely?
No, what I’m saying is that the Internet is going to continue to be disruptive, even though we think we know what it’s all about now, and I also think that the complexity of managing it for smaller firms is not getting easier at all. Yes, they could build big internal IT departments and incorporate the technical know-how to do this that way, but that’s not an option for that many. Instead, they are looking to seek trusted partners who they know can give them the best, most secure and I personally think, most critical part a highly scalable basis behind and below the applications their business is all about.

So, scalable, yes, that is certainly a big topic in the PEER 1 vocabulary.
Well, it is a key part of what we are and always has been since we started here in this office building I’m calling you from today in Vancouver in 1999. We offer three main services; our Server Beach, dedicated hosting space, our managed hosting service and our co-location offering. All of them hang off what we see as our core strategic asset, our 13,000 miles of fibre channel over which we have full control and which is the 10Gb backbone that links our 17 data centres across North America and as of a year ago Europe. So the mission here is to become the world’s best hosting company that owns its own network. It’s all there in our tag-line, really: Ping and People, which translates to cutting-edge technology and outstanding customer service from people who care.

But you haven’t been here since 1999, of course.
No, that’s true. I joined as its executive vice president in October 2005 reporting to the company’s co-founder and then CEO, Lance Tracey, becoming president a year later and as of September 2007 I became president and CEO of the company and its subsidiaries. I am delighted to be able to say that I’ve led us in a period of consistent growth and profitability and expansion. As for my own background, I spent twelve years with a Canadian investment banking firm where I served as a member of the executive committee, board of directors and was responsible for all banking activities at the firm.

You’re not a technologist?
I am more of a business person, I suppose; I have a Bachelor of Applied Science degree from the University of British Columbia and an MBA from McGill University and am a certified accountant here in Canada.

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Back to the company, then, if you don’t mind. What I don’t understand is that your website stresses how much you are focused on the SME but you’ve just talked about YouTube and I see that Capgemini Canada just leased 25% of one of your new data centres in Toronto – hardly small companies, surely?
That’s what I mean about scalability. YouTube didn’t know it was going to be that big and of course Capgemini will be using that space for clients, who will mostly be large government departments and enterprises. What I was trying to do really as give you a sense of both ends of the spectrum of business that works with the Internet, as we see it; both the largest and smallest clients need to be able to feel they have room to grow and that their complex needs will be taken care of. I’d say we are getting there. We have our Net Promoter Score (NPS), which measures whether or not a customer would recommend PEER 1 to a friend on a scale of 1 to 10; the current score is 43.

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