Last year, Verio was a radiant beauty wooed by a wealthy suitor. This year, Nippon Telegraph and Telephone is having second thoughts.
Verio, with 2000 revenue of $350 million, is suffering from dot-bomb fallout. Small and midsize businesses account for about 90 percent of Verios shared hosting revenue, and 50 percent of its colocation and dedicated server sales.
Last September, when Japanese telecom giant NTT bought Verio for $5.5 billion, $4.41 billion of that was in goodwill, to be amortized over 10 years. Due to Verios deteriorating U.S. business environment, NTT said in April it was studying a revaluation and write-down that could lead to a loss of billions of dollars this year.
Verio, led by CEO Justin L. Jaschke, plans to hold market share by offering hosting services to large global enterprises. The company finds an edge in its established distribution channels.
Verio will concentrate on managed hosting services, including data backup and security. The company is ramping up its Asian offerings using NTTs first-tier network, and plans to upgrade its U.S. backbone and add an OC-3 (155-megabit-per-second) European backbone this year.