Acquisitions of Web Hosting Companies in 2016

In the past year of 2016, there was a lot of movement in the hosting market. In addition to many smaller companies forming strategic alliances with others, there were also some really big acquisitions announced towards the end of the year. In the following article, we look back at the most important news of the year.

The first announcement from dogado GmbH in Dortmund reached us in January 2016. The acquisition of the web hosting provider media:Webline AG from Ahrensburg, along with their core brand Tophoster, already indicated an eventful year and marked the determined expansion strategy of the cloud specialist. In June 2016, another move followed with the acquisition of the web hosting provider CANDAN THE WEB COMPANY, enabling the company to consistently expand its business in the SME sector. Just before the end of the year, in December 2016, the acquisition of Alvotech GmbH from Düsseldorf was also announced. It will be interesting to see if dogado GmbH will continue its steep growth trajectory in the coming year.

Throughout the year, there were various mergers and acquisitions of smaller companies. For example, in June 2016, the offerings of the hosting brand domain*go were integrated into the portfolio of DomainFactory. Both brands have belonged to DomainFactory GmbH in Ismaning, Bavaria, for some time. There was also a change in ownership for the long-standing hosting brand Lennartz Hosting. Instead of Lennartz-edv GmbH, Urospace GmbH, a provider of cloud and hosting services, is now the new owner. In November 2016, the German service provider netcup was acquired by the Austrian IT provider Anexia, allowing the company to further establish its presence in the German hosting market.

However, the really big news didn't come until the end of the year. In December 2016, the top news of the year was announced: United Internet acquires Strato for 600 million euros. The internet conglomerate United Internet AG from Montabaur already owns several successful brands such as 1&1 or united-domains, and by acquiring the web hosting provider Strato, it can further strengthen its dominant position in the German market. On the other hand, the former owner of Strato, Deutsche Telekom AG, is losing significant market share in the web hosting sector.

The news of the Strato acquisition was only surpassed this year by an international announcement. In late November 2016, it was revealed that the US-based company Go Daddy plans to acquire the English web hosting provider Host Europe Group. The deal is valued at a total of 1.69 billion euros. This move would mark Go Daddy's entry into the European market. Host Europe Group is also active in Germany with brands like Host Europe Germany, Domainfactory, and Server4you.

Looking ahead to the new year of 2017, the hosting market remains very exciting. We can certainly expect more news in the first half of the year. It will also be interesting to observe the development and specific consequences for customers. The acquisition of Strato by United Internet has shifted the dynamics in the German market. Previously, Deutsche Telekom with Strato was the second-largest player in terms of customers and domains, closely behind United Internet AG with its numerous brands. However, the conglomerate can now significantly strengthen its dominant position and extend its lead over the remaining competitors.

The question remains whether customers will benefit from more performance at lower prices in the future, or if the development in the hosting market indicates a more negative trend due to reduced customisation options and potential cuts in customer service. Hosttest will certainly keep you informed about the latest developments in the new year as well.