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Internap Will Expand Boston Data Center

Internap Network Services (INAP) will add approximately 15,000 square feet of colocation to meet strong customer demand for space, the company said today. Internap's new space is located in a stand-alone 45,000 square foot facility adjacent to its existing Boston data center, and will come online in the fourth quarter  of this year.

"This initiative is part of our strategic plan to enhance data center offerings in key markets," said James DeBlasio, chief executive officer of Internap. "With this expansion in Boston, Internap now has its ninth owned facility and a total of 43 colocation service points, demonstrating our commitment to serving our customer’s growth requirements now and in the future."

Posted by Rich Miller May 09, 2008 | Permalink | Newsletter

May 08, 2008

Internap Shares Slip on Lower Guidance

Shares of Internap Network Services (INAP) lost ground today after the company lowered its revenue projections, citing slower growth due to fallout from outages and customer credits in its CDN network. Shares of Internap fell 33 cents, or 6.6 percent, in early trading after the stock was downgraded by Roth Capital, Cowen & Co and Stanford Research.

Internap said it now expects full-year revenue growth of 13 percent to 18 percent over 2007. The company had previously forecast revenue growth of about 25 percent for the year.

"The last several months have been challenging," said Internap CEO James DeBlasio. "In hindsight, the complexity of the VitalStream integration stressed our processes." Internap shares lost a third of their value in mid-March after the company reported that it would delay filing its annual report with the SEC as it sorted out up to $2 million in customer credits from outages on the VitalStream CDN network, which Internap acquired last year.

Posted by Rich Miller May 08, 2008 | Permalink | Newsletter

May 01, 2008

Internap Restates Revenue, Adds PoPs

Internap Network Services (INAP) has restated its 2007 revenue at $234.09 million, trimming $1.8 million from its initial report of $235.9 million to reflect customer credits that came to light last month, after its annual report had been filed. The company's net loss swelled from $4.5 million to $5.55 million. The revision was made in an amended 10K filing with the SEC, and was in line with the company's prediction that it would need to refund customers between $1 million to $2 million.

Internap also announced that it has brought 12 new points of presence (PoPs) online in its content delivery network (CDN) expanding coverage in North America, Singapore and Australia. The company also upgraded its existing nine PoPs in North America, Hong Kong, Japan, London and Amsterdam to provide for more efficient transfer of content and automated updating of content based on business rules.

Posted by Rich Miller May 01, 2008 | Permalink | Newsletter

April 08, 2008

Internap COO Departs

Internap Network Services (INAP) said Monday that chief operating officer Vincent Molinaro is leaving the company "to pursue other interests." Molinaro will remain as an Internap employee during a transition period to last through June 30. His departure was announced in a brief statment in an SEC filing.

The move is the latest in a series of executive changes since Internap shares lost a third of their value in mid-March after the company reported that it would delay filing its annual report with the SEC as it sorted out up to $2 million in customer credits related to service outages on the Vitalstream CDN network. On March 27 Internap named George E. Kilguss III as its new Chief Financial Officer.

Posted by Rich Miller April 08, 2008 | Permalink | Newsletter

April 03, 2008

Internap Boosts Rails Apps at Engine Yard

Engine Yard, a leading provider of Ruby on Rails hosting, will use Internap’s Performance IP service to enhance delivery of online applications, the companies said today. Engine Yard hosts most of its infrastructure with Herakles Data in Sacramento, and will use Internap (INAP) to enhance its network performance.

Engine Yard’s expertise with Ruby on Rails, an open-source Web framework and programming language, enables the company to quickly deploy database-driven Web apps. The company makes it simple to host and manage Rails applications, providing customers with infrastructure, scalability and support.

Posted by Rich Miller April 03, 2008 | Permalink | Newsletter

March 19, 2008

Internap Shares Slide on Customer Credits

Shares of Internap (INAP) lost a third of their value today after the company said that large service credits for several customers would delay the filing of its annual report with the SEC. Internap said it will likely need to refund at least $1 million to $2 million, and that its analysis "is still ongoing and subject to change." The issue has delayed the financial statements and audit required for filing with Internap's 10-K report.

Internap shares closed down $2.33 at $4.09, a drop of 33 percent for the day, in trading on the NASDAQ exchange. Merriman, Curhan, Ford & Co. analyst Colby Synesael dropped his rating on Internap from "buy" to "neutral" on the news.

UPDATE: Synesael says several hundred customers have requested credits for outages on the CDN operated by VitalStream, which Internap acquired last February. "Apparently, many of these customers used the legacy VitalStream portal to let the company know this, which Internap was no longer using, and did not discover until recently when it began to contact customers for late payment," Synesael writes.

Posted by Rich Miller March 19, 2008 | Permalink | Newsletter

March 06, 2008

SoftLayer to Expand Nationally with Internap

SoftLayer Technologies will expand its on-demand hosting infrastructure to the East Coast through a five-year, $40 million contract with Internap Network Services (INAP), the two companies announced today. The deal expands on a previous 5-year, $16 million contract for SoftLayer to establish a Seattle data center in Internap's facility in Tukwila, Wash.

"Internap and SoftLayer are bringing to the market a new, tightly coupled managed hosting model that is delivering enterprise-class, large-scale computing by the slice," said Lance Crosby, chief executive officer at SoftLayer. "With Internap we’ve been able to get to market faster and deliver higher quality solutions that our customers value and are core to their business operations."

SoftLayer, which is based in Plano, Texas and has its primary data center at the Infomart carrier hotel in Dallas, has been one of the fastest-growing hosting providers over the past year. SoftLayer had $33 million in revenue in 2007, up from $13 million in 2006, and now hosts more than 11,000 servers, the company said last month. SoftLayer sold 1,300 servers in January as it mobilized the sales operation for its new Seattle space.

Posted by Rich Miller March 06, 2008 | Permalink | Newsletter

January 22, 2008

Internap to Support Sugar Blog Network

Sugar Inc. will use Internap Network Services (INAP) to power its popular blog network, the two companies announced today. Internap will provide managed servers and network infrastructure for Sugar's blogs, which currently receive 6 million unique monthly viewers. Sugar Inc. operates sites for an audience of upscale women covering topics such as celebrity, fashion, shopping, beauty, entertainment, food and health.

"The blogosphere is booming and Sugar Inc. is leading the pack," said James P. DeBlasio, chief executive officer of Internap. "Our managed server, data center and Performance IP solutions are designed to enable new media and Web 2.0 firms to flourish, offering IT systems that grow with a company’s online presence and require low, up-front capital expense."

The Internap solution for Sugar includes managed servers running Red Hat Linux and Performance IP network capacity hosted in one of Internap’s collection of 36 global data centers.

Posted by Rich Miller January 22, 2008 | Permalink | Newsletter

January 10, 2008

Internap Completes Global CDN Buildout

Internap Network Services (INAP) says it has finished work on points of presence in Hong Kong and Tokyo, completing the construction of its worldwide content delivery network (CDN). The additional sites will expand access to Internap's network architecture, known as Private Network Access Point (P-NAP), which manages traffic to improve the performance of Web-based applications.

"Our newest PoPs allow us to deliver a redundant, highly-scalable CDN platform for enterprises seeking superior performance," said James P. DeBlasio, president and chief executive officer for Internap. "This milestone expands our market opportunity by increasing the capacity of our CDN, positioning Internap as a leader in the space."

Posted by Rich Miller January 10, 2008 | Permalink | Newsletter

November 13, 2007

SoftLayer in $16M Deal for Space at Internap

Fast-growing Dallas hosting company SoftLayer will expand its infrastructure by leasing space at a Seattle area data center operated by Internap Network Services (INAP), the companies said today. The additional space in Internap's facility in Tukwila, Wash. will allow SoftLayer to add 10,000 servers to host a new utility computing platform that will launch next month. The lease is part of a five-year, $16 million contract in which Internap will also supply network services in SoftLayer's Dallas and Seattle centers.

SoftLayer, which is based at the Infomart carrier hotel in Dallas, has been one of the fastest-growing hosting providers over the past year. The company launched in 2005 with an innovative "network-in-a-network" design that provides bandwidth to support hosted applications, server-to-server file transfers, load balancing and disaster recovery services.

"SoftLayer’s unique solutions strategy is fueling their exponential growth," said James P. DeBlasio, chief executive officer at Internap. "They needed a network and data center partner they could trust to grow with them and we are pleased they selected Internap. This 5-year $16 million contract for network services and data center space enables SoftLayer’s innovative hosting solution today and is the platform to support their future growth."

Posted by Rich Miller November 13, 2007 | Permalink | Newsletter

November 06, 2007

Internap Plans More Data Center Growth

Internap Network Services (INAP) plans to add an additional 50,000 square feet of data center space in the first half of 2008, the company said today in its quarterly conference call with analysts. Company officials said the additional space will allow it to offer more services to its 3,552 customers.

Internap recorded net income of $1.8 million and earnings of 4 cents a share on $60.9 million in revenue for the third quarter, compared with net income of $195,000 and earnings of 1 cent a share on $45.9 million in revenue in the year-ago period.

"In the third quarter we secured attractive financing to support the expansion of our data center facilities," said Internap CEO James DeBlasio, who said the initiative would include expansions in both company-owned data centers and partner sites. Internap operates eight facilities, and leases space in 28 third-party data centers. The company sites comprise 52 percent of its data center footprint.

Posted by Rich Miller November 06, 2007 | Permalink | Newsletter

November 02, 2007

Internap Unveils P2P CDN Capabilities

Internap Network Services has teamed with Pando Networks to offer peer-to-peer (P2P) capabilities for its content delivery network. The new hybrid P2P CDN will be available by the end of 2007, and combines Internap's caching and routing infrastructure with Pando's Video Booster P2P client, which is installed on user computers.

Internap (INAP) says the service complements its streaming services for Adobe Flash and Windows Media videos, creating a "flexible and reliable CDN solution for business and government organizations ... with new levels of security, reliability and business intelligence."

"Until now, P2P networking was an interesting technology that could not meet the requirements of enterprise applications and digital media owners," said Philip N. Kaplan, chief strategy officer at Internap and co-founder of VitalStream. "Internap’s CDN and content monetization tools combined with flexible delivery methods for P2P, Adobe Flash video and Windows Media provide enterprise-class solutions for digital media content and applications."

Posted by Rich Miller November 02, 2007 | Permalink | Newsletter

September 19, 2007

Credit Line Will Fund Internap Colo Expansion

Internap Network Services (INAP) is the latest company to line up additional financing to support its infrastructure plans. The company said Tuesday that it has closed a new four-year senior secured credit line from Bank of America. The agreement includes a $5 million revolving credit facility (which may be increased by $15 million) and a $30 million term loan facility.

The Atlanta company, which provides intelligent routing services that help bypass Internet congestion points, said it will use the proceeds to refinance existing debt and fund the expansion of its colocation facilities. Internap has announced a series of facility expansions over the past two years, including several additions to its Seattle colo space, and expansions in Toronto, Los Angeles, Boston and New York. The latest expansion, a $40 million initiative announced in June, did not identify the specific cities targeted for new colo space.

Posted by Rich Miller September 19, 2007 | Permalink | Newsletter