Tunisia: Understanding the Shared Hosting Market with T. Nakbi, Oxahost.tn, and Z.O. Ali, Safozi

When thinking of markets for business development, many think of locations like Europe and America, which is, of course, fair. But very often, not-so-common, or even overlooked locations present the biggest opportunity. That is the case of shared hosting, and the example of Tunisia is here to prove it.

In the interview below, we sat down with Tarek Nakbi, manager and CEO of Oxahost.tn, and Zied O. Ali, the founder and CEO of Safozi.com to talk about shared hosting and domain markets in Tunisia, and understand in which direction the digital world is moving in the country. Oxahost is a company in Tunisia focusing on web hosting and domains, while Safozi concentrates on cloud infrastructure and servers.

Tunisia and Lessons from Fails

Tunisian Hosting Market

The population of the country is 11.5 million, with an internet penetration rate of around 50%. Out of the 11.5 million, there are around 7 million people who are social network users. There is a relatively high growth rate in the Internet market, with many of the country's 600,0000+ businesses creating websites. 42,000 .tn domain names are registered in the country, so the ratio of .tn domains registered in the country to the number of businesses is less than 10%. When buying domains, people prefer the local .tn domain to more popular tlds like .com or .net.

User Behaviour

Users buy hosting and domain together, and they usually buy a domain name for their website. This is mainly because of the regulations in the country: cybersquatting and reselling .tn domains are forbidden in Tunisia. If users buy domain names, they need to use them for themselves.

Customer Support and Preferences

When it comes to customer support, there are two languages prevailing in Tunisia: French and Arabic. For ticket support, French is usually the prevailing language, while for phone support, Tunisian Arabic is the language of choice for customers. English support is not that necessary in Tunisia, although it very much depends on the customer. 'The most important thing is to get the problem solved, the language is irrelevant.' Support works mainly during office hours since there is no need for support during other hours.

Price vs Quality

'Customers need some experience to understand that quality is important. The first time they choose the price, try to buy cheap services, but after a bad experience, they choose quality,' says Tarek. 'When people come to us, they are usually experienced, and they prefer quality. The price also matters, of course, but they are looking for high-quality service,' mentions Zied.

When compared to other places, for example in France, the pricing is around 3 times less.

OVHcloud, one of the biggest hosting names in the world, is popular in Tunisia. According to Zied, it is successful because there is no alternative. 'We as hosting companies are working to create that alternative. When we talk with customers, some of them are not happy with the services they receive, or the pricing. In OVH, you have the price, you have the money, you receive the service: and there is clear pricing. We are working to create a similar smooth process and provide customers with alternatives, and an accessible pricing model.'

Being Local Helps

One of the main competitive advantages local hosting companies have over big players is being….well, local. “We are local, we reach the customer. If they need anything, we are here to support them, and it’s one of our competitive advantages.” People, on the other hand, are loyal to the providers they choose. It’s one of the reasons promotions don’t work in Tunisia. “When people see an ad or a promotion, if they already have a provider, they are going to ignore the ad and stick to their provider.”

Africa is Full of Opportunities

'We are in a huge continent of 1 billion people, 40% of youth who are aiming to switch to digital. They are really technology hungry, and we believe that there is an opportunity to be successful as hosting businesses,' says Zied.

Additionally, Tunisia is geographically close to Europe and has a great location for hosting companies aiming to enter both African and European markets. For example, for countries in the Americas, Australia, etc. If they have a presence in Tunisia, they are close to Europe. 'We’ve tried some things, and started having interest from countries in South America, Africa, China, etc, so it’s a good thing to have servers deployed in Tunisia.'

Payment and Finances

There used to be a farewell which made it hard for local customers to pay companies that are abroad. The main payment gateway is gpgcheckout.com, which is protected. However, this is not a big problem anymore. 'Foreign currency rules are getting more flexible, and people can use cards to pay certain amounts. People can pay in different currencies, but paying in local dinar still has some advantages because of the exchange rates.' For hosting, the price is around 1 euro/month, and for cloud hosting, it’s around 5 euro/month.

Website Builders in Tunisia

The popularity of website builders is just the beginning. Zied thinks it’s a thing of market maturity: 'Website builders are very good for B2C markets, it’s a very good entry product. In Tunisia, there are many emerging software development companies fighting for clients, and people can have websites developed at very affordable prices. And although the quality may not be as good as it would have been with website builders, and a website made with a website builder will be much better, people still prefer to have their websites developed. However, this is changing.'

Web Hosting Business in Tunisia

'Our main goal is to understand the customer's needs and give them the product they need at a price they can afford,' says Zied. 'What we know for sure is how to translate customer needs into our services, shared hosting, domains, cloud services, etc. If you explain to people what problems the product solves, they will buy it. When you start a business, you learn a lot and become an expert, but you also miss a lot. With time, you start building your arguments.'

'There is a huge opportunity to grow the shared hosting market, and we want to make it happen in Africa,' continues Tarek.

Final Thoughts

For us, Tunisia was a great place to start as part of exploring the hosting market of Africa. As a newly developing market, the country’s shared hosting business offers great opportunities for many businesses and is hungry for investment and new players. This market is yet to develop, and we can’t wait to see where it goes.