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| {{Primarysources|article|date=May 2007}} | {{Primarysources|article|date=May 2007}} | ||
| '''Verio''' is an ] (ISP) in the ]. Incorporated in 1996 in ], it is currently a wholly owned subsidiary of ] (NTT) Communications, which purchased it in ]. Verio performed |
'''Verio''' is an ] (ISP) in the ]. Incorporated in 1996 in ], it is currently a wholly owned subsidiary of ] (NTT) Communications, which purchased it in ]. Verio performed a consolidation of the ISP industry. | ||
| ==History== | ==History== | ||
| Initially, Verio raised funds with which to purchase |
Initially, Verio raised funds with which to purchase ISPs around the United States and ]. It was funded by the principal founders, private investors, NTT, and institutional investors in a ]. The concept was to ] small ISPs into one large national ISP and achieve ]. | ||
| By the year 2000, Verio had purchased almost fifty small ISPs, most in the U.S. but some in Europe |
By the year 2000, Verio had purchased almost fifty small ISPs, most in the U.S. but some in Europe. During this time Verio went public on the ], trading under the symbol VRIO. In early 2000 Verio was sold to NTT at a per-share price of over $60, a total cost slightly exceeding $5 billion. Because NTT is a ]-owned company, foreigners are not allowed to own NTT stock (according to Japanese law) and therefore the buy-out was a 100% cash deal. The United States Congress held hearings over the transaction to ensure it did not violate national security concerns. The ] and the ] expressed concern that the Japanese government, which owned 53 percent of NTT at the time, could gain access to classified information should the U.S. government use Verio's network to tap Internet communications during an investigation. To placate these concerns, NTT agreed to form a separate division within the company staffed only by U.S. citizens to handle any work in support of government investigations. As a result, the ] recommended that President Clinton allow the $5.5 billion purchase to proceed. The deal also prompted scrutiny of Japan's openness to foreign telecom competitors. | ||
| ⚫ | Shortly after the announced deal, the NASDAQ stock market crashed in the spring of 2000 in the ] burst. The agreed price of around $60 remained and NTT and Verio completed the transaction by the fall of 2000. | ||
| The ] and the ] expressed concern that the Japanese government, which owned 53 percent of NTT at the time, could gain access to classified information should the U.S. government use Verio's network to tap Internet communications during an investigation. To placate these concerns, NTT agreed to form a separate division within the company staffed only by U.S. citizens to handle any work in support of government investigations. As a result, the ] recommended that President Clinton allow the $5.5 billion purchase to proceed. The deal also prompted scrutiny of Japan's openness to foreign telecom competitors. | |||
| ⚫ | Over the course of the next few years Verio abandoned the lower revenue consumer market and focused primarily on the more lucrative business to business web hosting market. Much of the original infrastructure and employees it had purchased were disbanded or consolidated into a few large centralized data centers. | ||
| ⚫ | |||
| ⚫ | Over the course of the next few years Verio abandoned the lower revenue consumer market and focused primarily on the more lucrative business to business web hosting market. |
||
| Verio continues to operate as a wholly owned subsidiary of NTT America. | Verio continues to operate as a wholly owned subsidiary of NTT America. | ||
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| ==Some of the ISPs purchased by Verio== | ==Some of the ISPs purchased by Verio== | ||
| Verio was initially built on a business model known as a "]", composed entirely of smaller companies operating under the Verio brand-name. By the year 2000, Verio had purchased almost fifty small ISPs,<ref> MorganStanley, 11 Aug 1999, pg. 30</ref> most in the U.S. but some in Europe, ranging in price from under a million dollars (USD) to over 100 million dollars per ISP. These companies were often mature and well known brand names in their local markets, more well known than Verio, and often continued to operate with a great deal of local autonomy even after purchase by Verio. |
Verio was initially built on a business model known as a "]", composed entirely of smaller companies operating under the Verio brand-name. By the year 2000, Verio had purchased almost fifty small ISPs,<ref> MorganStanley, 11 Aug 1999, pg. 30</ref> most in the U.S. but some in Europe, ranging in price from under a million dollars (USD) to over 100 million dollars per ISP. These companies were often mature and well known brand names in their local markets, more well known than Verio, and often continued to operate with a great deal of local autonomy even after purchase by Verio. Some of the ISP's purchased by Verio were leading pioneers in the ISP industry, representing the first wave of commercial ISP access in local markets around the US and Europe. Some of these companies included ], ], and ]. | ||
| ==Notes== | ==Notes== | ||
Revision as of 17:16, 14 May 2007
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Verio is an internet service provider (ISP) in the United States. Incorporated in 1996 in Denver, Colorado, it is currently a wholly owned subsidiary of Nippon Telegraph and Telephone (NTT) Communications, which purchased it in 2000. Verio performed a consolidation of the ISP industry.
History
Initially, Verio raised funds with which to purchase ISPs around the United States and Europe. It was funded by the principal founders, private investors, NTT, and institutional investors in a private placement. The concept was to rollup small ISPs into one large national ISP and achieve economies of scale.
By the year 2000, Verio had purchased almost fifty small ISPs, most in the U.S. but some in Europe. During this time Verio went public on the NASDAQ, trading under the symbol VRIO. In early 2000 Verio was sold to NTT at a per-share price of over $60, a total cost slightly exceeding $5 billion. Because NTT is a Japanese government-owned company, foreigners are not allowed to own NTT stock (according to Japanese law) and therefore the buy-out was a 100% cash deal. The United States Congress held hearings over the transaction to ensure it did not violate national security concerns. The Justice Department and the Federal Bureau of Investigation expressed concern that the Japanese government, which owned 53 percent of NTT at the time, could gain access to classified information should the U.S. government use Verio's network to tap Internet communications during an investigation. To placate these concerns, NTT agreed to form a separate division within the company staffed only by U.S. citizens to handle any work in support of government investigations. As a result, the Committee on Foreign Investment in the United States recommended that President Clinton allow the $5.5 billion purchase to proceed. The deal also prompted scrutiny of Japan's openness to foreign telecom competitors.
Shortly after the announced deal, the NASDAQ stock market crashed in the spring of 2000 in the dot-com bubble burst. The agreed price of around $60 remained and NTT and Verio completed the transaction by the fall of 2000.
Over the course of the next few years Verio abandoned the lower revenue consumer market and focused primarily on the more lucrative business to business web hosting market. Much of the original infrastructure and employees it had purchased were disbanded or consolidated into a few large centralized data centers.
Verio continues to operate as a wholly owned subsidiary of NTT America.
At the end of 2005, the backbone and some dedicated hosting centers moved to NTT America, with the web hosting business staying with Verio. At the same time, the European arm, Verio Europe, was moved in its entirety to NTT Europe. In October 2006 Verio Europe was re-named NTT Europe Online.
Some of the ISPs purchased by Verio
Verio was initially built on a business model known as a "rollup", composed entirely of smaller companies operating under the Verio brand-name. By the year 2000, Verio had purchased almost fifty small ISPs, most in the U.S. but some in Europe, ranging in price from under a million dollars (USD) to over 100 million dollars per ISP. These companies were often mature and well known brand names in their local markets, more well known than Verio, and often continued to operate with a great deal of local autonomy even after purchase by Verio. Some of the ISP's purchased by Verio were leading pioneers in the ISP industry, representing the first wave of commercial ISP access in local markets around the US and Europe. Some of these companies included ATMNet, ClarkNet, and WorldWide Access.
Notes
- The Internet Data Services Report MorganStanley, 11 Aug 1999, pg. 30