COMPANY PROFILE

Annual revenue: WND

HostTech Communications, one of the oldest and largest Internet data centers in Rhode Island, has weathered dramatic changes in a rapidly evolving market, repositioning itself to thrive as the industry marches into the future.

The Providence-based company is a leading provider of telco-grade co-location and managed data services in the state, providing data backup, disaster recovery, network security, IT infrastructure and business continuity to companies as far away as New York and New

Jersey.

HostTech also provides Internet access, Web hosting and

e-commerce services.

The company was founded in 2000 to support America Online's then-flourishing dialup Internet business. At one point early in HostTech's history, virtually every one of AOL's dialup connections in southern New England was processed at HostTech's data center.

But with the advent of broadband and wireless Internet, the company's leaders realized they needed to find new niches if HostTech were to survive, said Casimir Kolaski, general manager and part owner.

"Our whole business was based on dialups in 2000. Now our business is based on disaster recovery," he said.

HostTech's state-of-the-art, 40,000-square-foot data center on Westminster Street in Providence, in the heart of the city's "fiber alley," is designed to keep its clients' computer systems up and running 24 hours a day, seven days a week and 365 days a year.

The Internet disaster recovery and data security industry is booming as companies move to store their computer systems in remote locations to prevent disruptions in the event of a natural disaster or terrorist attack, and to protect their data against security breaches.

HostTech treats Providence's size and location as a strategic advantage, attracting clients from Boston and New York who want to maintain their computer systems outside their large metro areas but close enough that engineers can easily travel to their machines, Kolaski said. "Here in Providence, we still have some access to decent fiber and connectivity, but we're not A-1 targets of terrorists or anything like that," he said.

HostTech protects its clients' computers with a security system at the data center that includes proximity access readers and 1,500-pound magnetic locks. Only authorized individuals have access to equipment, and a digital surveillance system monitors visitors.

The data center maintains two separate fiber pipelines, houses several primary generators and takes other steps that guarantee its power and cables will stay up in the event of a regional power outage, such as the one that cut power throughout much of the Northeast in the summer of 2003, Kolaski said.

Many of HostTech's clients are doctors and health networks whose data storage must have enhanced security to comply with privacy laws.

HostTech's data center includes a separate space for them, with locked cabinets and other security measures. BA Health Network Systems, a Warwick-based company that provides software for medical offices, recently moved its operation into HostTech's data center, Kolaski said.

Other HostTech clients include Middletown-based satellite communications company KVH Industries Inc., which also has offices in Denmark and Chicago; UniTeller, a company in New Jersey that facilitates money transfers to and from other countries; and Eze

Castle, a software company with offices in New York, Boston, Stamford, Conn., and London that provides disaster recovery for hedge funds.

HostTech is positioned to expand rapidly into its new niche because of a heavy investment it recently made in its infrastructure.

Last year, the company installed its own cables – called dark fiber – which provide the most secure connection available, Kolaski said. The company also fitted its data center with a climate-and-humidity-control system that maintains an optimal environment for computer hardware. The carefully calibrated environment enables computer systems stored at the data center to use less electricity – a savings experienced by HostTech's clients, he said.

Earlier this month, HostTech announced it had purchased 18 IP address blocks, which will enable it to provide more than 2,000 affordable, individual IP addresses to its clients.

"We're free to grow forever now," Kolaski said. "We've got our own dark fiber, we've got our own IP allocation, we've got some of the best environmentals out there, and we're ready to roll."