Hewlett-Packard (HP) is to take a £4 million stake in XTML, a privately owned UK Internet access provider.
This is the first time that the company has made an equity investment in an European start-up, and comes nine months after it first announced its ebusiness strategy in an attempt to catch up with competitors, in particular Sun Microsystems.
HP's plan is to take equity stakes or make revenue sharing deals with promising Internet startups as a way of getting in at the ground level. The supplier has invested in partnerships with telco, Qwest, and a number of US start-ups.
Steve Muddiman, European marketing director for HP's Internet business, said: "We think what XTML has is a unique proposition. The fit was right from a technology point of view and the financial projections we have made."
He added that its £4 million investment gave HP an option to take 10 per cent of XTML.
The two companies also said they planned to jointly launch application hosting and application service provider services next month, which could include portal hosting or services for mobile device users.
XTML, which was set up in 1994, has four sites in the Manchester area, linked for backup and mirroring purposes by a 4Gb local area network.
Cisco provides the network hardware, but XTML also works with a number of Internet service providers to supply it with the necessary bandwidth.
While Muddiman said that HP already supplies all of XTML's servers, he added that he also expected the supplier to implement its eSpeak eservices software, when it is available for serious commercial use. The software was announced last year.
At the same time, XTML also announced that it was introducing two new services for companies wanting to run reliable Internet or ecommerce sites.
The first offering is the Serverbank hosting facility, which is based in the former Bank of England bullion vaults in Manchester. XTML claims that the multiple seven-foot thick concrete and steel walls, bomb-proof door and 60 CCTV cameras make it the most secure hosting centre in Europe.
The company is now also offering users its Ensure insurance service. This is backed by Lloyd's Brokers, Houlders Insurance Services, and compensates customers for lost business from downtime, including malicious damage, if the outage was caused by XTML's servers. Ensure costs £200 to £300 per month for basic cover of £1 million.
John Ridd, XTML's managing director, said: "Many companies offer service level agreements that will refund additional connection days, but this does not replace lost business."
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