Lumison brand set to be leading light in UK

LUMISON, the Edinburgh-based internet services firm formerly known as edNET, is to roll-out its brand UK-wide after spending the last year building up a national sales force.

The fast-growing city business, which features in both the Deloitte Technology Fast 50 and Fast 500 European rankings, has also been cashing in on the growing trend for companies to co-locate their IT networks and have a back-up facility available in the event of a breakdown or computer virus attack.

Lumison opened the doors to its 1.2 million state-of-the-art data centre at Newbridge in October 2004 and is now preparing to move into the second of the building's data rooms, having filled up the first.

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Chief executive Aydin Kurt-Elli revealed that the ten-year-old company was growing at the rate of 30 per cent or more each year, and the challenge going forward was how to scale that up.

He said: "This year, the firm will do about 4.5m in turnover, however, we are looking to 'hockey stick' that, which is why 2006 is going to be a year of decision making.

"We will continue financing the growth of our sales team, taking the brand out UK-wide, now that we have a platform to play from. We are also going to invest in marketing and bring a couple of key products to market."

Those products will include a dedicated voice-over-internet (VoIP) offering which is pitched at small and medium-sized businesses looking to upgrade their conventional phone systems. Lumison, which in addition to its data centre and internet service provider (ISP) divisions operates a web design subsidiary called Lightershade, has tended to attract new business through reputation and referral.

But over the last year or so the firm has been hiring sales people to cover major cities across the UK. As a result, the coverage offered by its broadband customer base extends as far as London and Cornwall.

Mr Kurt-Elli, who founded the edNET business when he was in the second year of a medical degree, said the company was now "pro-actively selling" its ISP service.

The operation had "gained economies of scale", he said, adding: "The key drivers of our growth have been the rebranding, sales activity and the construction of the data centre, where, over the last six months, we are ahead of sales targets.

"We have filled up the first data room and are moving into the second. The facility has been a sensible investment. By having our own infrastructure, we have reduced our costs significantly and we can provide services to customers that we just couldn't do before."

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He admitted that while the Lightershade arm was producing "healthy numbers", scaling up a consultancy business like that was "hard work".

Lumison, which has a core headcount of 54, operates in an industry sector undergoing rapid change.

Recent corporate activity has included the 211m takeover of broadband supplier Easynet by satellite giant BSkyB. It is likely the broadcaster will use Easynet to support its move into video on demand.

Earlier this week, Scottish telecoms firm Thus announced the twin acquisitions of rival Your Communications from United Utilities and ISP Legend in deals totalling some 70m.

The business ISP market is split between a host of small and mid-sized players, such as Lumison, and a small number of much larger players including newly-enlarged Thus, with its Demon ISP brand.

While not referring to specific examples, Mr Kurt-Elli believes that some of the industry consolidation is being driven by the sale of "distressed assets", and noted there were "a lot of people shopping around".

He said: "There's a lot of M&A activity in this space. In some cases, people are exiting because there is something wrong.

"The only reason for us exiting at this stage would be if there was a good strategic impetus behind it.

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"If the opportunity arose where it was part of scaling up the business and taking it to new markets, or doing something different, then you can never say never."