LDC Sells UK2 Stake to E-Commerce Firm The Hut Group

Private equity firm LDC has sold its stake in U.K. hosting provider UK2 Group to e-commerce firm The Hut Group (THG) for an undisclosed amount.

According to a statement, THG will leverage its stake in UK2 to support its existing proprietary e-commerce platform.

Founded in 2004, THG originally provided white label e-commerce website for grocery stores, but now its proprietary e-commerce platform is used by health and beauty brands. Today THG’s platform manages over 100 websites in the health and beauty industry. THG says its “in-house platform combines five unique skills for online retail: cross-channel digital marketing, customer data science, artificial intelligence, internationalization and direct to consumer fulfillment.”

See also: CBRE: Top European Data Center Markets Booming, Led by London

THG also plans to invest heavily in the existing UK2 management team and employee base of 200 people to support growth while continuing to offer UK2’s services to existing clients. With the acquisition of UK2, THG will employ around 600 technology staff.

“This is a significant technology investment to support our growth plans and provide a world class proprietary ecommerce platform and infrastructure to increase capacity, speed and resilience for our global customer base,” Matthew Moulding, Founder and Chief Executive Officer of The Hut Group said. “We are delighted to welcome UK2 and their highly skilled technology-based team of people to THG. The move will also see UK2 become a core part of our Technology proposition within the THG Platform Division, helping us achieve our ambition of becoming a world class platform for technology clients. We expect this to be the start of further significant investment in UK technology with a further 1,000 new technology jobs planned over the next three years.”

LDC acquired its stake in UK2 back in 2011, paying about $77 million for its majority stake. UK2 operates 7 brands including 100TB, a provider of dedicated servers, UK2.net, Midphase, Resell.biz, Westhost, Virtual Internet and VPS.net.

“After a six year journey with LDC, this is an excellent outcome for employees, management, customers and shareholders, and an ideal strategic fit for both businesses,” Simon Adcock, Senior Portfolio Director at LDC who has led the process, said in a statement. “For an ambitious, technology-led group like THG, hosting is mission-critical – UK2 provides a well-invested, plug-in capability to strengthen and enhance their existing infrastructure and support their growth. We wish the business every success for the future.”

LDC will continue to hold its stake in UK2 Group’s e-sports business Digital Chaos.

Firms Fret as China Implements Local Data Storage Law

(Bloomberg) — Just days before China’s new Cybersecurity Law goes into force, foreign companies are grappling with rules that could tighten what is already one of the world’s most restricted technology regimes.

Recent changes to the language of the law ahead of its June 1 implementation, such as a broader definition of those affected, could drag in a wider array of services and products. While industry groups are lobbying for a delay, the government is moving ahead.

China is bringing in a raft of new measures, giving the government unprecedented access to foreign companies’ technology, as it bolsters control of the collection and movement of data. Forcing companies to store information within the mainland has already led some to tap cloud computing providers with more local server capacity, a potential boon to homegrown Alibaba Group Holding Ltd. and Tencent Holdings Ltd. at the expense of Amazon.com Inc. and Microsoft Corp.

“Almost all our companies are making moves to ensure that the majority of the data they collect in China is stored on servers located within China,” said Jake Parker, vice president of the US-China Business Council in Beijing. “It’s not just the technology companies – it’s financial services, semiconductor manufacturers, every sector of business in China, that’s impacted.”

See also: How the Chinese Data Center Market is Evolving

One organization that could feel the pinch of the regulations is GreatFire.org, which monitors blocked websites in China and helps users behind the nation’s controls. The nonprofit creates copies of banned sites hosted outside the mainland, putting them on Amazon Web Services cloud servers to circumvent government restrictions known as the Great Firewall.

“Our strategy would collapse because if foreign businesses host all of their data in China, they would face minimal disruption if the authorities cut off access to the foreign internet,” said GreatFire.org founder Charlie Smith.

Alibaba said in a statement it follows “all local laws where we conduct our business.” Microsoft declined to comment, Tencent couldn’t immediately comment and Amazon didn’t immediately respond to a request for comment.

In addition to the restrictions on moving data beyond the mainland, provisions in the law include a more comprehensive security-review process for key hardware and software deployed in China and a requirement to assist authorities conducting security investigations.

See also: Chinese Data Center Provider GDS Files for IPO on NASDAQ

While individual firms in China rarely speak out publicly against government policy, more than 50 trade associations and chambers of commerce signed a letter in May to the government seeking a delay. They argued that the law could impact billions of dollars of cross-border trade and lock out foreign cloud operators because of limits on how they operate in the country.

“These measures will add costly burdens, restrict competition and may decrease the security of products and jeopardize the privacy of Chinese citizens,” according to the letter from bodies representing businesses based in the U.S., Europe, Japan, Korea, Australia, and elsewhere.

While foreign firms are pushing for change, the law has support from some domestic experts, such as Li Yuxiao, a professor who studies internet regulation at Beijing University of Posts and Telecommunications. He sees secure information systems as integral to protecting the economy while also placing value on domestic operating systems over foreign products.

“Cyber security is crucial to national security,” he said.

The National People’s Congress’s Standing Committee passed the law in 2016 ahead of its implementation, giving companies and others time to adjust. Subsequent language published by the government “expanded the scope of a law that was considered quite onerous to begin with,” said Gabriela Kennedy, a Hong Kong-based partner of Mayer Brown JSM.

For example, rules limiting the transfer of data outside China’s borders originally applied only to “critical information infrastructure operators.” But that was changed mid-April to “network operators,” which could mean just about any business.

“Even a small e-business or email system could be considered a network,” said Richard Zhang, director of KPMG Advisory in Shanghai.

Another provision requires IT hardware and services to undergo inspection and verification as “secure and controllable” before companies can deploy them in China. That appears to be already tilting purchasing decisions at state-owned enterprises.

“We’ve heard from our members that domestic banks and SOEs are being much more thoughtful about purchasing domestic technology, and shifting away from foreign products – despite the fact that there’s no specific requirement for them to do so,” said Parker.

While the laws affect all companies in China, it’s expected to hit the foreign firms the hardest. That is because they typically have more businesses, headquarters and data-processing centers overseas with a greater need to move information outside the mainland, according to Scott Thiel, a Hong Kong-based partner at DLA Piper.

Sophisticated or widespread cyberattacks, such as the recent WannaCry ransomware attack that exploited versions of Microsoft Windows, may bolster the government’s resolve.

“We can assume that Chinese leadership will use it as an example of why China needs its own technology and cannot continue to rely on foreign suppliers,” said Adam Segal, Director of the Digital and Cyberspace Policy Program at the Council on Foreign Relations in New York.

Rackspace Acquires Managed Cloud Firm TriCore, Adds 500 Employees

Rackspace has reached a deal to acquire consulting and managed cloud services company TriCore Solutions, adding its enterprise application management expertise and support, according to a Thursday announcement. Financial details of the deal, which is expected to close in June, were not disclosed.

TriCore provides management of Oracle and SAP Enterprise Resource Planning (ERP) products, as well as business intelligence and analytics, data warehousing and integration services. These mission-critical applications manage core business functions, but are complex and expensive to run, according to the announcement, which leads companies to seek help managing and optimizing them.

See also: Rackspace Bets on Multi-Cloud Boom with New Professional Services

“Our customers are asking us to move further ‘up the stack’ by expanding our managed application capabilities,” Jeff Cotten, Rackspace president said in a statement. “TriCore’s services are among the best in that space and are highly complementary to ours. They will help enable us to deliver more of the services that our existing customers need, while opening the door to new opportunities across the globe.”

Last week Rackspace announced the launch of a new Application Operations service to help customers optimize their websites and applications, including applications from Oracle and SAP.

The transaction is the first acquisition Rackspace has made since announcing on Wednesday that its new CEO Joe Eazor will start on June 12. 

TriCore’s executives and over 500 employees will join Rackspace as part of the acquisition, and continue to work out of the same locations. Rackspace says the culture of TriCore, which was founded in 1999, is similar to its own, and that TriCore serves about 275 customers.

“TriCore and Rackspace are a great fit in terms of our cultures and we offer complementary services,” said TriCore CEO Mark Clayman. “We’ve worked for 18 years to develop our delivery expertise, create value for customers, and win their trust and loyalty. We are extremely excited to join the Rackspace team and leverage its brand and industry reach to continue to expand our offerings.”

SaaS App Use Up 33 Percent Over Last Year, BetterCloud Says

The average company uses 16 SaaS apps, up 33 percent from a year ago, according to BetterCloud’s 2017 State of the SaaS-Powered Workplace Report. By 2020, nearly three in four respondents said that 80 percent or more of their apps will be SaaS-based.

The increase, according to BetterCloud, is driven by companies which operate a “SaaS-Powered Workplace.” Almost all apps used by this 38 percent of companies are SaaS, an average of 34 each. This approach results in fewer emails, fewer meetings, and higher customer satisfaction, according to the report.

“SaaS is a double-edged sword,” BetterCloud founder and CEO David Politis said in a post on the report. “And while it brings incredible benefits, it also creates formidable challenges that are taking the roles and responsibilities of IT to new extremes.”

See also: Two-Thirds of Companies Lack Overall Cybersecurity Policy

Forty-four percent of SMBs say that 80 percent of their apps will be SaaS this year, compared to 29 percent of middle-market companies and enterprises. That gap, however, is expected to disappear by 2022, as the two groups converge at 80 percent SaaS-Powered Workplaces.

The report also suggests that SaaS adoption has “come full circle,” with IT retaking control of SaaS use in the enterprise, after shadow IT SaaS adoption pushed applications beyond on-premise software run by the IT department. The process is ongoing, however, as just 62 percent of apps in SaaS-Powered Workplaces are managed by IT.

SaaS-Powered Workplaces are 3.5 times more likely than other businesses to consider delegating admin privileges a challenge, and almost 3 times as likely to consider managing external access a challenge. To adapt, the report says, CIOs and IT teams must rethink roles, responsibilities, processes, and budgets, while working closely with business units to balance the needs for continued SaaS adoption and control over IT environments.

One of the issues demanding IT department control over SaaS use is network performance, according to a report on Office 365 deployments released Thursday by Zscaler.

How Consumers View Ransomware and Security after WannaCry

Brought to you by Talkin’ Cloud

It’s been two weeks since WannaCry first made the news around the world. The ransomware took control over more than 300,000 PCs across 150 countries.

Just like any other massive security incident, the publicity had many people outside of tech talking about the security of their data and thinking about how well they would be able to fend off a similar attack.

According to a report released this week by security provider Carbon Black, based on responses from 5,000 people, 57 percent of consumers said WannaCry was their first exposure to how ransomware works. Here are five more takeaways from the report.

1. Consumers Inclined to Pay Ransom

More than half of consumers surveyed (52 percent) said they would pay a ransom, which is actually an ill-advised way to deal with ransomware attacks; 12 percent of respondents said they would be willing to pay $500 or more to hackers demanding ransom. The majority of consumers (59 percent) would pay less than $100 to get their data back.

2. Consumers Think Companies Need to Bear Brunt of Responsibility

Despite a common understanding in the broader community that security is a shared responsibility, most consumers still believe that it is up to the company that houses the data to keep it safe.

According to Carbon Black, the onus of responsibility to keep consumer data safe is the organizations themselves, followed by cybersecurity companies and software vendors.

3. Consumers Most Trusting of Healthcare, Financial Firms

Interestingly, despite ongoing reports of healthcare organizations dealing with patient data incorrectly, consumers are actually more trusting of healthcare firms and financial institutions than retailers.

Seventy-percent of consumers trust healthcare and financial firms to keep data safe, versus 52 percent of consumers who trust retailers with their data. This is likely connected to the public’s perception of how retailers handle data after the big data breaches at retailers like Target and Home Depot over the past several years.

4. Consumers Unforgiving of Security Slip-ups

Perhaps one of the most critical findings of the report is how willing consumers are to find a new provider in the instance of their current financial, healthcare or retailer being hit by ransomware. Seventy-two percent of consumers said they would consider leaving their financial institution if it was hit by ransomware, compared to 68 percent of consumers who said the same of their healthcare provider, and 70 percent who said the same of their retailers.

It is important to note that it is much easier to decide not to shop somewhere than transfer accounts and healthcare records.

5. Consumers Most Protective of Financial Data, Personal Photos

Financial data and personal photos and videos are the data that most consumers hold dear, while only 5 percent of consumers said medical records were their most valuable personal information, tied with phone data.

While financial data and personal photos are certainly important and valuable information, medical records are extremely valuable on the black market, according to cybersecurity experts, up to 20x more valuable than credit card data.

Reseller Hosting Industry Expanding at Rapid Pace

As we live more and more of our lives online, opportunities in web hosting have exploded. Going hand-in-hand with this, reseller web hosting services have also seen unprecedented growth.

As every reseller’s aim is growth, having a long-term hosting partner with outstanding customer service, transparency, and reselling tools is key. Resellers also need to remember that growth requires scalability, not just a one-size-fits-all approach. Fortunately, InMotion Hosting meets all of these criteria, and offers highly competitive prices and other desirable features.

Good Time for Resellers

According to a study by Market Research Future, the Web Hosting Services market experienced growth of over 16% last year. At present, the industry generates approximately $154 billion (USD) each year. E-Commerce also continued its expansion online, while mobile technologies — such as smart phone and tablet applications — account for a large portion of the recently booming growth. Emerging “smart” technologies and the so-called “Internet of Things” (IoT) will only add to this demand for Internet real estate.

Combined, these factors mean more people needing to find ways to get their products, messages, and services online. That, in turn, means more demand for hosting, and more opportunities for reseller web hosting services. Intriguingly, one of the fastest growing segments identified in the study belonged to SMEs (small and medium enterprises). SMEs are often perfect target customer bases for resellers.

Where in the World Should Resellers Focus?

According to the study, North America has the highest concentration of web hosting demand in the world. While that may not be surprising, it reveals a great deal of opportunity for reseller web hosting services in other markets around the world. For example, a number of European investment firms have started backing web hosting services. They cite as their motivation the key role such service providers will play in the future development of European businesses moving onto the web. The Asia-Pacific market appears ripe for a similar boom. Here, pioneering companies blaze trails into the US and abroad with mail order over the Internet. These companies sell products (and some services) over the web at prices western companies find difficult to beat.

Although some of these companies will set up web hosting exclusively in their local regions, the better plan often requires servers around the world. This allows for regional sites and traffic routing that serves content to customers in particular areas from nearby servers. Thus, if a Chinese company seeks to make headway in the American market, it may construct a website with American spellings and content and serve those pages from a server located in the United States. This provides the fastest page load times for visitors and helps the company appear to be local. Globalized commerce spells opportunity for reseller web hosting services wishing to cater to companies outside of the United States.

Ready to Get Started?

Reseller Infographic

InMotion Hosting offers some of the best Reseller Web Hosting Plans in the industry. Whether just starting out or a seasoned professional, InMotion Hosting has an option that will work for you – and at affordable prices. To learn more, visit the InMotion Hosting Reseller page for more information.

Kaspersky Lab Offers Source Code to U.S. Government

Brought to you by MSPmentor

The head of Kaspersky Lab is offering to turn over to U.S. officials the source code for its software products in a latest effort to dispel fears that the Moscow-based firm’s cybersecurity tools contain “back doors” that could be exploited by the Russian government.

Founder and CEO Eugene Kaspersky made the comments to The Australian newspaper in Sydney, where he is a keynote speaker at the CeBIT Australia business technology fair.

See also: Average DDoS Attack Peaked at 14.1 Gbps in Q1 2017: Verisign

Questions about the integrity of Kaspersky Lab software were thrust into the headlines this month after a report on social news site BuzzFeed said a review is underway to determine the extent to which Kaspersky products are being used by government agencies and how to get rid of them.x

Days later, the heads of several U.S. intelligence agencies told a Senate committee hearing that they would not feel comfortable using Kaspersky products in their organizations.

“It’s suicide,” Kaspersky told The Australian about the risks of planting vulnerabilities in software for use by the U.S. government. “It would not only kill the business, but you’d have to save your life somewhere in a jungle, in the Amazon River or in Siberia.”

Kaspersky has already said he would be willing to testify before Congress and added to that offer today.

“(I) would give them the source code for checking,” he’s quoted as saying. “When we have government contracts, in some cases we’re asked to disclose our technologies – and we do it.”

Kaspersky attended a Russian intelligence academy and worked as a cybersecurity engineer for Russian military intelligence.

And while many of his employees also came from the ranks of Russian intelligence, he rejected assertions that they could or would compromise the company’s software.

“We do have former employees from the Russian defense, from the European defense, from the Israeli defense and from different countries,” he told the newspaper. “The people are coming to get a job and they are good guys; they’re not working on defense anymore.”

“I don’t have any case of an employee doing something like that,” Kaspersky added. “And it’s not possible to inject the code because people are watching.”

Asked whether the allegations stemmed from paranoia or a smear campaign, Kaspersky suggested that market competitors could be to blame.

“I don’t know exactly, but sometimes it smells like some guys are not happy with our success,” he said.

Report: One-Quarter of Firms Won't Meet GDPR Deadline

Brought to you by Talkin’ Cloud 

With the deadline for GDPR compliance a year away, one-quarter of respondents to a new survey by cybersecurity firm Guidance Software say they are not going to be ready to meet the May 2018 deadline.

GDPR will require many companies headquartered outside of the EU to comply with European data protection rules, but some companies are much farther along than others in the planning process.

According to Guidance Software, who surveyed 225 senior-level IT security executives from the U.S. and U.K. last month, only 15.7 percent of companies are in advance planning for GDPR.

See also: GDPR Compliance Presents Business Opportunity to Proactive Cloud Firms

Experts have urged cloud providers to start evaluating their systems and processes now to ensure they protect data adequately under the new regulation.

Forty-three percent of organizations with $1 billion or more in revenues currently have processes that can identify data records of any EU citizen and determine where that data is being processed, the report said, compared to 26.8 percent of organizations with less than $100 million in sales.

Smaller companies are being helped along by firms like Microsoft, which is holding workshops and webinars to help customers and partners meet the deadline, calling obligations related to GDPR compliance a shared responsibility.

The top activities to be GDPR compliant are using procedures for the anonymization of personal data, conducting a full audit of EU personal data manifestation, and evaluating all third-party partners that access personal data transfers.

According to the report, more than half of companies surveyed have not begun the process of evaluating third-party products.

Twenty-three percent of respondents said that hiring and training a qualified Data Protection Officer was a high priority for the organization, compared to 15.4 percent who named it a low priority.

Hackers Target DocuSign, BT Customers with Phishing Emails

Brought to you by Talkin’ Cloud

Customers of DocuSign and U.K. telecommunications firm BT have been warned about phishing emails sent over the past week that appear legitimate, but contain malicious links. Here’s what you need to know about the two separate phishing instances.

DocuSign Customer Emails Stolen

DocuSign reported last week that stolen customer email addresses were used in a phishing attack that sent out emails on three separate days in May. DocuSign has told customers to filter or delete emails with these subject lines:

  • Completed: [domain name] – “Wire transfer for recipient-name Document Ready for Signature”
  • Completed [domain name/email address] – “Accounting Invoice [Number] Document Ready for Signature”
  • Subject: “Legal acknowledgement for [recipient username] Document is Ready for Signature”

According to a statement from DocuSign, “if a recipient clicks on the link in the phishing email, a Word Document will automatically be downloaded. In order to initialize the malware, the recipient will need to open the Word Document, and enable Microsoft Office Macros.”

The company has assured its customers that no signers were on the list of email addresses that was accessed by hackers, unless they had signed up for a DocuSign account.

The company is keeping customers informed through its security status page.

BT Scam Relies on WannaCry Ransomware Panic

As companies of all sizes sought to protect their organizations from the WannaCry ransomware, some hackers took advantage of this hysteria through a phishing campaign targeted at BT customers.

The phishing email appeared as though it was sent by BT, with a very convincing domain and branding, authorities said, which “could easily catch out those who are concerned about the security of their data after the global attack”, referring to the WannaCry ransomware.

Customers were reminded to not click any links, and to check the email header to identify the true source of the communication. It is also worthwhile for customers to contact a company directly through their website if they are concerned about the source of an email.