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10 January 2013
Interoute thrived in 2012, but the company’s CEO Gareth Williams only has his sights set on the future. He explains to Alex Hawkes his vision of virtualisation.
2012 was something of a landmark
year for Interoute. It extended its network into Turkey, Russia
and Asia. It made a string of strategic acquisitions and
partnerships. And it capped it all off in November by picking
up the Capacity Award for 'Best pan-European Wholesale
But of all the company’s achievements in the last
12 months, it is the potential of the company’s
virtualised hosting platform that really gets
Interoute’s CEO Gareth Williams’s
At the start of 2012, Interoute launched its virtual data
centre (VDC) product - a private and public cloud computing
platform built into the company’s pan-European
MPLS/IP network. According to Williams, VDC has gone on to
impressively generate over €1 million in revenues since
"We see virtualisation as the future," says Williams. "It is
coming to the forefront now and you can’t hide
anymore at the back. Cloud is an enabler for businesses.
It’s something they can try and if it fails, they
haven’t spent millions."
Williams is a man who is always
looking forwards and never back. Joining Interoute in 2002,
within a year he was running the entire sales and marketing
department, and by the end of 2007, he was appointed CEO.
Under his leadership, the company has successfully balanced
substantial investment in new services and expanded
infrastructure with maintaining healthy profitability. As a
result, Interoute’s top-line revenues soared to
€366 million in 2011, a stunning 24% increase over the
same period in 2010.
"From the offset, we had very simple goals for the business,"
he says reflecting on the company’s rise. "We have
a permanent review of how we can do something cheaper, faster,
Williams takes an extremely hands-on approach to management. He
holds an hour-long induction with every new member of staff,
explaining in great detail the company’s values
and idiosyncrasies. "There’s no special sauce we
give people, but we try to embed our values in them," he
It’s fair to say that Williams also monitors the
company’s expenditure meticulously: "We
don’t waste share- holders’ money."
Pinching a line from his favourite film 'Jerry
Maguire’, Williams has set up an internal
'show me the money’ initiative, where every
Interoute employee is encouraged to contact him directly with
ideas to save the company money. He estimates this has saved
the company approximately a quarter of a million euros in three
Of his staff, he comments that the company attracts and retains
people who "like to take responsibility, fight and win
customers". "It’s been a hard road for Interoute
building our business in 10 years," he adds.
Adaptability has also been at the
heart of Interoute’s ascent, and it is why the
company can be seen aggressively pursuing opportunities today
in the world of cloud.
The introduction of an applications management product set,
along with the launch of the VDC solution, form a core part of
the company’s unified ICT strategy. "It is the
fastest growing part of our business," says Williams. "The
growth of our business was 15% in Q3 2012, but unified
computing far outstripped that."
Having spotted an opportunity in the market, Williams
isn’t about to shy away from it. The company made
considerable investment in the tail-end of 2012 to support its
ICT strategy. It made moves to accommodate the VDC platform in
both its Berlin facility and its Paris data centre, then
committed to launching a new data centre in Ghent, Belgium,
which is due to be operational in January 2013.
This reflects what Williams perceives as a change in customer
confidence in virtualisation. Inspired by the success of
virtualisation in the retail sector, the adoption curve for
large enterprises has soared.
"Most customers don’t believe they have the right
answer. They either go to external integrators, consultants or
some go to the massive names such as IBM and Logica. Others
come to the operators and ask what we can be doing?" he
"One of the reasons we bought Quantix last year was that we
recognised evolutionary migration services are a key feature
for us going forward, and the company possessed a key skill
base to develop that," he adds.
The partnership Interoute signed with Europe’s
football governing body UEFA at the end of 2011 has almost
become a showcase for its hosting provider capabilities.
Interoute’s pan-European cloud service supported
UEFA during the 2012 European football championship last
summer, and will continue to support UEFA’s
business, football tournaments and events over the next year
and a half.
"We manage their web presence, as well as their internal and
external IT. We are one and half years into that partnership
and already we are talking about where we can take their large
private cloud by year three. What can we virtualise next?" he
The engagement point with the customer, he identifies, has
become much earlier. "It’s no longer a case of
'we’ve decided what the solution is and gone out
and bought it’. Now it’s more the
case of – what is it we should be virtualising? What
are the security concerns of building this platform?"
Arguably the largest thing holding
back consumer confidence in virtualisation is security. The
threat is very real as Interoute discovered during the European
championship, when it protected UEFA’s website and
key logistics applications from repeated DDoS attacks.
"Security across every level is just going to grow and grow,"
he says. "There is the straightforward concern of malicious
attacks. But then you also have the concern of leakage,"
There are in fact endless questions facing enterprises
consuming cloud services: "Who has access to what programmes?
Who is running third party programmes on their PC? Where do you
firewall? How do you protect your internal IT assets when
people are bringing their own devices to the party?" Williams
He believes, however, all this could present an opportunity for
operators, particularly as customers increasingly ask operators
to do more monitoring of networks. "We have our own security
operations centre in Prague and it is a very fast growing side
of our business, both from a network security perspective and a
managed hosting perspective," says Williams.
He admits security is a grey area for both businesses and
operators. While customers are clearly encouraging operators to
move deeper into security, there’s a fine line
between ensuring safety on networks and allowing the customer
to go about their routine business.
"Customers want various prevention levels. But many are worried
about doing that on the operator side as you could be really
affecting the day to day business of your customers," he says.
"Essentially customers want to carry on doing business, and you
can’t just stop the problem in a draconian
The question now facing Williams,
is will he be able to replicate Interoute’s
success in 2013? Certainly from a network point of view, the
company appears unlikely to expand aggressively as it did in
"We are hoping to expand the business more in-country, than
outside. We want to consolidate what we built with Superonline
in Turkey and go much deeper. In Russia, we have been fortunate
to develop a good team and in MegaFon we have found a good
partner, so we will build there too," he says.
Such an approach reflects how truly Eurocentric Williams
perceives the company: "We believe our key focal point and
growth opportunity is being the best possible operator in
Europe," he says.
Overall, Williams predicts another busy year for the company in
2013: "We want to build bigger and bigger managed hosting
solutions, and really drive our IaaS platform to more and more
customers," he says.
History: Interoute’s pan-European network
was completed at the end of 2002, and was expanded through the
acquisition of GTS/Ebone’s metropolitan fibre
assets that same year. This was followed by acquiring media
services assets in 2003, an eastern European fibre network in
2004, PSINet Europe/Via’s managed hosting services
in 2005, a managed services company in Bulgaria in 2006 and 51
Degrees, a London Metro business and a Swedish hosting company
CEO: Gareth Williams became CEO of Interoute
in August 2007.
Ownership: Interoute was originally funded by
the Sandoz Family Foundation, which was joined later by the
Kingdom of Dubai to privately fund its massive civil works
project for Europe.
Network: Interoute’s network is
supported by 60,000km of fibre, 21 metropolitan area networks,
nine data centres and 32 co-location centres with local
operations in the 26 largest cities of Europe. Its network
covers the EU as well as Turkey, through nine subsea landing
stations ringing the edge of Europe. To the west, the network
links to North America’s major telecoms hub. To
the east, the network connects the Middle East to Europe
through Dubai. In the south, Africa from Cape Town to Tunis
connects directly to Europe through Interoute.
Services: Interoute claims to offer
Europe’s largest cloud services platform. Its
Unified ICT platform serves international enterprises, as well
as major European telecoms incumbents and the major operators
of North America, east and south Asia, governments and
virtualization and the security i.e.both way security = access + leakage. very much true it is the future but full of risks internally, externally and built in.great thought digged well with organized provoking questions.simply great
Jan 22, 2013