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IPOWER plagued by client criticism

Web host firm plagued by client criticism

Andrew Johnson
The Arizona Republic
Mar. 6, 2008 12:00 AM

Complaints about Web-site crashes, shoddy tech support and billing errors have spurred fast-growing IPower Inc. to revamp its approach to customer service.

In recent months, the Phoenix-based Web-hosting company has nearly doubled its number of customer-service representatives and adopted new software to manage customer feedback.

The changes have come as the company finds itself the focus of Internet blogs slamming its service and customers threatening to cancel their accounts.

Two months ago, Tom and Alicia Evers' Web site, which the entrepreneur use to relay game schedules to about 300 athletic referees, crashed.

The Evers run a home-based business that finds independent referees for youth and adult sports events in the north Dallas area. Their Web site is the only place the referees can obtain the details of their assignments.

"This is my livelihood," said Tom Evers of Allen, Texas. "When (my site is) down, I might as well be out of business." The Evers have been hosting their Web site with IPower for about three years. Until their site crashed in January, the Evers said they had experienced only a few glitches with IPower's service.

But the most recent outage has got the business owners considering going to another Web host.

Several IPower customers told The Republic that they shared the Evers' frustration. They said problems have become more frequent since IPower merged with an East Coast competitor last year and began moving customer sites to new data servers.

IPower CEO Thomas Gorny said company officials are aware that some customers have experienced problems in recent months.

He attributed some of the issues to the company's "server migration," which he said ultimately would let the company provide users more services to control their accounts.

The upgrade process for the majority of customers has been smooth, he said. The volume of complaints did increase last year but has decreased in recent months, he said.

That's partly because the company hired an additional 100 customer-service representatives to handle increased call volume, Gorny said.

The company also adopted a new online feedback program called RatePoint, which it hopes will better enable it manage customer concerns.

Gorny said customer loyalty remains strong.

"From a cancellation rate (perspective), we haven't experienced any spikes," he said.

IPower currently has an unsatisfactory record with the Better Business Bureau of Central, Northern and Western Arizona, meaning the company has repeatedly failed to respond to or resolve complaints the agency has received.

A BBB report on the company lists several complaints regarding contracts, billing, repairs and other issues. The report states that the company resolved many of the issues consumers reported but has not responded to others.

IPower is not registered as a member of the BBB, spokeswoman Felicia Overton said.

Altogether, IPower has about 300 employees who work mostly at the company's headquarters in Phoenix. The company also operates a data center in California, where Gorny founded the company in 2001.

In late 2005, Gorny moved the headquarters to its current location at Ninth and Jefferson streets in downtown Phoenix.

From a growth perspective, IPower has been deemed major success.

In 2006, IPower ranked 121st on Inc. magazine's list of the 500 fastest-growing U.S. companies.

At the time, the company reported having annual revenue of $29.1 million and employing 158 workers.

Last year, Gorny told The Republic he expected the company to hit about $55 million in sales.

IPower merged with Massachusetts-based Web host Endurance International Group last summer. The two companies have continued to operate separate headquarters under their respective names.

Combined, the two companies host more than 1 million accounts, Gorny said.

Endurance did not return calls seeking comment.

Customers say they think the company's rapid ascent may be catching up with it.

"We've just decided they don't have time for us, so we need to move on," said Paul Rey, who owns an information-technology consulting firm in Turlock, Calif., that has been an IPower reseller for about seven years.

As a reseller, Rey said his company pays a wholesale price for IPower's hosting packages and domain-name-registration services, which it then sells to its own customers.

Rey's company, Foothill Systems LLC, also is a reseller with other Web hosts. Of the 250 sites the company handles for its customers, about 50 are hosted with IPower, he said.

Initially, Rey said IPower's service "was excellent." The company's technology-support staff was easy to reach and quickly responded to Web-site issues.

But about two years ago, Rey said his company began experiencing problems with IPower, including increasingly longer wait times for tech support, frequent billing errors and e-mail outages.

That's taken a toll on Rey's bottom line. He estimates his company has lost a handful of clients - who rely on Rey and not IPower - as a result of repeated glitches.

"We're not that big a firm," Rey said. "When we lose six or eight or 10 clients . . . that hurts."

IPower's service has angered some customers to a point where they've taken to the Internet, blasting off angry chat-board messages about their discontent with the company.

Some people have created entire Web sites about the company. One example is, a blog where purported IPower customers air their gripes about the company. An explanation on the site states it was created in January so customers can vent about IPower's "incredibly lousy level of service and support."

E-mails sent to the site's creator were not returned.


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