Intranets.com expands lineup with conferencing

Hosted collaboration software provider Intranets.com Inc. plans to announce Monday the addition of Web and audio conferencing capabilities to its service, a move it hopes will help it compete against Microsoft Corp. and other vendors for business from price-sensitive small and mid-market companies.

Intranets.com, based in Boston, claims a customer base of 180,000 users, making it one of the largest vendors in the growing ranks of ASPs (application service providers) targeting small companies and departments of larger enterprises. ASPs traditionally offer fewer features and customization options than do traditional on-premise software deployments, but can save customers on installation and management costs and hassles.

On a monthly subscription basis, Intranets.com offers a suite of collaborations tools including individual and group calendars, file sharing and database repositories. This week the company adds to its line-up, for an additional fee, audio and Web conferencing tools, allowing users to share applications and presentations.

At $99 per month for Web conferencing for up to 25 simultaneous users, and $0.12 per minute for audio conferencing, Intranets.com’s conferencing applications cost less than those from Microsoft and several other vendors also targeting midmarket customers.

“Web conferencing is complicated, and it’s often priced for peak usage,” said Karen Leavitt, Intranets.com’s vice president of marketing. “That’s the problem we want to solve for our customers: make it easy and affordable.”

One customer, American Infertility Association (AIA) administrator Melinda Micciola, said her organization is looking forward to taking advantage of the new conferencing offerings.

“We do a lot of educational chats right now,” she said. “Now, with this potential, we’ll be able to have people interact. We could have a keynote speaker and broadcast that, for anyone willing to sign on and join the conference call.”

Micciola’s New York-based nonprofit organization became an Intranets.com customer several months ago, after she surveyed available collaboration options for connecting the AIA’s five employees. Traditional software packages, including Microsoft’s SharePoint products, were too expensive for the group, she said.

“We’ve been very lucky finding this,” Micciola said. “It was the one we’ve been able to afford, and the programs have been user-friendly.”

Intranets.com’s plan is to stay focused on the needs of companies with up to 250 users scattered throughout several office locations, Leavitt said.

“We are aimed very squarely at the small-business market,” she said. “We will never be the intranet for all General Motors (Corp.), but one of its divisions has a half-dozen sites with us.”

Intranets.com came by its small-business collaboration mission in a roundabout way. The eight-year-old company began life selling shrink-wrapped software. Business was slow, and when ASPs became the dot-com rage in 1999, the company launched its Web site, offering free collaboration software under an advertising-supported business model. Like many other online service providers, the company soon discovered that an advertising-supported business model wasn’t a profitable one.

But, in a twist on the usual dot-com tale, when Intranets.com asked its users to begin paying, they did. Its user base dropped from 600,000 to 75,000, but with those 75,000 charter subscribers the company began rebuilding and attracting new customers. Intranets.com has been profitable for its last five quarters, and is on track this year to earn $1.5 million on revenue of $10 million, Leavitt said.

Most of the 7,000 companies Intranets.com serves are based in the U.S. Through a joint venture with Hitachi Ltd., the company offers a localized version in Japan, and in mid-2004 it plans to introduce the service in Germany.

The company also has scheduled its next major feature upgrade. In March it will overhaul its scheduling tools, revamping its existing calendar and migrating the application’s underpinnings to .Net, Leavitt said. The update’s new features include allowing customers to schedule conference rooms, invite colleagues to meetings, and check a synchronized group calendar for fellow employees’ availability and conflicts.

The ASP market for business applications is gaining visibility, as start-up vendors accrue market share and traditional vendors expand their software-as-a-service offerings. Intranets.com’s user base eclipses that of one of the industry’s most visible ASPs, Salesforce.com Inc., which attracted widespread attention in December when it announced plans to go public.

Intranets.com, which raised $40 million in venture capital and burned through most of it during the late ’90s, was once barreling toward an IPO (initial public offering) of its own. The dot-com meltdown aborted those plans — a change that was for the best, according to Chief Executive Officer Rick Faulk.

“Four years ago that was our big exit strategy,” he said. “Then everything crashed and we rebuilt. Now, we need to get a bit more critical mass before we consider it.”