Exodus Communications

» see exodus.net as it lived, on the wayback machine

~ the obituary ~

The first time i heard the name Exodus it was already gone, sitting in a chart in something written about the dot-com bust. That is the correct way to meet a hosting company, which is to say late and secondhand. Nobody typed exodus.net on purpose. You typed the name of a site you wanted, and the site came out of a building in Santa Clara with a different company's name on the door.

K.B. Chandrasekhar and B.V. Jagadeesh started it in 1994 on an argument that sounds obvious now and was not obvious then. A company running a website did not want its server under a desk on the office power feed. It wanted the machine somewhere with real cooling and a connection that stayed up when the building did not, and it did not want to own the room that made either of those true.

They named the room an internet data center and sold space in it by the cabinet. Exodus went public on the Nasdaq in March 1998, and Ellen Hancock arrived the same month out of Apple and IBM, taking the chief executive job that September. What followed was thirteen straight quarters of something near forty percent growth, which is the point at which a number stops describing a business and starts describing a market.

At the top in 2000 the company was worth about thirty-two billion dollars and held roughly four million square feet of floor across forty-four data centers, with some four and a half thousand customers inside them. i was sixteen, on a dial-up line in Turkey, and the name never once reached me. That is not a hole in my memory. It is the product working correctly. Hosting is the business that succeeds by being unnameable from the outside.

~ the case file ~

~ what they actually sold ~

The product was conditioned floor space with a fat pipe attached, sold to people whose expertise was software. Later there was a managed tier where Exodus staff ran the operating system and the backups as well, which was where the margin was supposed to come from. The physical part was not glamorous. Raised floor and diesel generators outside, with a badge reader that meant your competitor's machines could sit ten feet from yours without either of you minding.

The customer list ran through most of what people were looking at. eBay was in there. So was Google, whose entire machine fleet in 1999 lived in an Exodus cage in Santa Clara, because a search engine with no revenue could not build a room like that and did not need to. This is the part worth holding onto. The companies everyone remembers from that era were tenants. The landlord is the one that died.

~ the year it went wrong ~

In 2000 Exodus agreed to buy GlobalCenter from Global Crossing for six and a half billion dollars in its own stock. The deal closed in January 2001 and the stock it was paid in had by then fallen to about one and nine tenths billion, which is the whole story of that year compressed into one transaction. The buildings had been financed with debt, and the debt was fixed. The tenants were not.

Web hosting is a business with an unusually direct connection to the survival of its customers. A dot-com that ran out of money did not downgrade its plan, it stopped existing, and its cabinet emptied. Through 2001 that happened across the estate at once. Ellen Hancock resigned on 10 September 2001 and the company filed for Chapter 11 sixteen days later, on 26 September.

~ what happened to the buildings ~

Cable and Wireless announced on 30 November 2001 that it was taking the assets for five hundred and seventy-five million in cash plus about a hundred and eighty million in assumed liabilities. It kept thirty data centers and let the rest go, which is the first honest measurement anyone had of how much of that four million square feet was actually wanted. A company valued at thirty-two billion had sold for roughly two percent of it.

Cable and Wireless America then failed in its turn and sold to Savvis in March 2004, and Savvis went to CenturyLink in 2011, and CenturyLink renamed itself Lumen. Type exodus.net today and you land on lumen.com after two redirects, having been passed down a chain of four owners without being asked. The buildings mostly kept running under other names. Somebody else's servers are in them now, which is the only ending a data center ever gets.

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