Other obstacles have less to do with technology than with customers' conflicting objectives. For example, you may seek airtight security in a Web hosting solution but also request that the vendor extend to you (or to a third-party monitoring service) direct access to internal security-monitoring or systems-management tools.

Some vendors argue that airtight security prohibits outside entities from gaining any access to the elements of the hosting platform that reside inside vendor firewalls. However, many customers who are rightfully concerned about the security of their data and applications are also deeply concerned about ceding total control of the data and applications to an outside vendor, such as the hosting service provider.

This conflict is old hat to seasoned outsourcing veterans turned hosting service providers. It cuts to the heart of the definition of managed hosting.

In any outsourcing arrangement, a customer is contracting with the outsourcing agent to perform a service. One school of thought holds that the outsourcing agent, once contracted, assumes full responsibility and accountability for the service. Another views outsourcing as "out-tasking." That is, the outsourcing agent's task is to execute the customer's plan or design, but the customer retains managerial responsibility and accountability for the success or failure of the outcome.

Customers -- and many managed Web hosting service providers -- differ in which strategy they embrace. Based on their RFI responses, some vendors -- notably Computer Sciences Corp. (CSC) and EDS -- bristle when customers contract for a service but still want full access to the management tools used by the vendor to monitor and maintain the hosted site. The request seems to smack of implicit mistrust and reflects the customer's suspicion of the accuracy of management reports supplied by the vendor on a routine basis. Irritated vendors complain that a managed service is just that: a service that is managed by the Web hosting service provider. The customer needs to trust the vendor to do its job.

To other hosting vendors, such as Exodus Communications, Interliant and Xand Corp., a signature on the contract -- and on the monthly check -- entitles the customer to every consideration. "When a company shells out the kind of money that some of these Fortune 20 companies pay for managed Web hosting, they have the right -- and the leverage -- to get full access to all information on their systems, networks and data any time they want it," says Mike Linett, president of Zerowait, an engineering firm based in Newark, Del.

"Truth be told," says one spokesman for EDS, who acknowledges that his firm has accommodated customers to whom management-tool access was an issue, "once a little time has passed and the customer is comfortable that the service is delivering on its service-level agreement, the remote access is seldom, if ever, used again." A successful vendor knows, he says, that the customers are never wrong, even if they are occasionally a little short on being right.

Money Talks

As many customers have discovered, there is some correlation between the price of a managed Web hosting service and the quality of service received -- especially once the Web site host configuration goes beyond a comparatively simple one used to serve up static HTML-based Web pages via HTTP. One area in which managed hosting providers differ from the collocation service providers is in service billing.

Most managed hosting vendors have taken lessons from collocation vendors and from traditional IT outsourcing companies to define a profitable business model. Virtually all collocation service providers made sizable capital investments to build facilities and infrastructure in preparation for customer contracts. They attempted to recoup these investments through a combination of subscription fees and bandwidth charges. With the commoditization of collocation facility offerings, income generally proved insufficient to cover prior outlays.

To avoid repeating this mistake, most managed Web hosting service providers take a hefty bite out of their customers' wallets up-front, in the form of implementation charges, ranging from several thousand to several tens of thousands of dollars. In most cases, managed hosting vendors offer configuration and service options on a menu. A standard service is described and pricing is provided. Some vendors, including CSC, offer a discounted rate for the standard service if the customer is willing to use a shared back-end service, such as a shared database or storage platform. After the standard service, various options may be listed for purchase on an á la carte basis. These features include SAN, shared database, directory, VPN, custom reporting, helpdesk, backup and recovery services. (For a full list and description of CSC's extra services, see the company's complete RFI response online.)

Many managed Web hosting arrangements, which generally take the form of three-year agreements, also entail configuration requirements that were seldom seen in first-generation collocation settings. For example, customers are more likely to ask for WAN connections to link the managed host platform to back-end systems installed in their own corporate IT environments. This is largely a function of Web technology's evolution and users' increasing sophistication. Larger vendors may provide such integration services as a part of their standard managed hosting services contract, but integration with back-end systems may be offered as an additional implementation service and with an additional price tag by smaller vendors.

Implementation costs are only part of the cost of a managed Web hosting service arrangement. Providers also charge a monthly service fee, which is subject to an SLA, either written into the service contract or attached as an addendum.

SLAs are widely misunderstood to be the criteria for evaluating a managed Web hosting service arrangement and, by extension, the basis for managing the service provider. In reality, SLAs cannot define all of or even the most important aspects of a successful managed Web hosting arrangement. While significant, system downtime statistics (unless they are terrible) are less important to the success of the relationship between vendor and customer than common sense, cool-headed judgment and good communications.

There are no effective ways to capture in an SLA a provision that, for example, every phone call to the vendor's technical-support group will result in a productive conversation with a top systems administrator or DBA (database administrator) who is intimately familiar with the customer's system or database. However, when customers begin to lose the sense that they still enjoy close affinity with vendor support staff, contracts can sour just as quickly as they can if downtime becomes an issue.

Effective managed Web hosting vendors are augmenting their contractual relationships with customers through the development of customer advisory councils and other innovations. EDS, for example, provides a service-quality message board where customers can post their issues and observations for immediate review by account teams and quality-control personnel. Other vendors, such as Xand, use extensive trouble-ticket accounting systems to ensure quality service to individual customers and to identify trends that may point up other opportunities for service improvement.