TAX EFFICIENT HOSTING: Global Competition and Growth in Offshore Hosting

In this the first report to survey tax efficient offshore locations for hosting, readers are guided through the current status and conditions in 33 jurisdictions globally, which stand out as among the foremost locations. Using a unique scorecard system, offshore hosting markets are ranked in terms of overall attractiveness across five sets of criteria: economic incentives available, low tax administration, telecoms infrastructure, web hosting facilities, and e-commerce regime.

The report draws attention to the growth in offshore hosting, which is currently driven by higher taxes imposed in mature markets, competition in foreign inward investment and e-commerce enabled by enhanced Internet backbone and data centre infrastructure, and online gaming. This study suggests that Tax Efficient Hosting will become increasingly important as a source of competitive advantage to companies in the e-commerce sector.

Research for the report suggests that escalating competition and growth in offshore hosting is occurring in emerging markets. Countries in Asia, the Caribbean and Latin America - and more recently the Middle East and North Africa - are seeking to position themselves as alternative low cost regimes to their larger economic neighbours. The number of countries offering zero tax rates in increasing.

Yet as more emerging markets enter the offshore and tax efficient market, they are typically hampered by a fixed line monopoly and lack of legislative framework. The report points to the inadequacy of installing a zero or low tax regime, without the means to support other necessary criteria, and is no longer a sufficient differentiator in its own right.

Identifying key growth drivers, the report analyses current and new opportunities fuelling demand to host offshore. International competition to attract businesses to host within low tax economies, offshore "tax-free" jurisdictions and near-shore zones is intensifying. Businesses appear to be adopting a mix and match strategy, dispersing different parts of their operational requirements across a number of jurisdictions.

The report also details the critical differences between jurisdictions, and provides easy-to-access summaries of the key relevant conditions prevailing in each market.

Implications also exist for data centre operators in mature markets - competition from offshore markets and the mix and match strategies adopted by enterprises, may imply a requirement to extend their presence and portfolios to include tax efficient locations. Some already do so, but a more global approach may be required in future.

Above all, the report brings recognition to the sector for the first time by aggregating the data available, and demonstrates that offshore hosting is a significant growth market, and strategically important for operators and users alike.

• 33 Tax Efficient Jurisdictions
• Current Offshore status
• Market overview and summary
• Main challenges and opportunities
• Unique Scorecard for Offshore Hosting Locations
• 70 Tables and Charts
• 166pp

• Data Centre operators
• Colocation and Hosting Companies
• Integrators
• Infrastructure and Connectivity Providers
• Blade Server Suppliers
• Power, Heating and Cooling Suppliers
• Security service providers
• Application service companies
• Regulatory Organisations
• Law Firms
• Consultancies
• Financial and Investment Services Organisations