NetRegistry buys Distribute.IT assets, chief says hacking attack among worst he’s ever seen

Domain name reseller and web hosting firm NetRegistry has purchased the assets of crippled hosting company Distribute.IT, saying the company’s assets will integrate well with its core business and provide opportunities for expansion.

But company founder and chief executive Larry Bloch also says some of the derogatory comments being directed at Distribution.IT are undeserved, saying the cyber-attack that crippled the Melbourne-based firm nearly a week ago was one of the worst he has ever seen.

“It’s one thing trying to defend yourself against people trying to steal something, it’s another when what you’re dealing with is just unwarranted defacing of property,” he says.

Bloch says he contacted Distribute.IT earlier this week without the intention of buying the company, but after noticing how badly the situation had deteriorated, the discussions progressed into the possibility of a purchase.

“I’ve known them for nine years now since they’ve started their business. We’ve been following this for a while, with everyone on Whirlpool and through the press and so forth.”

“After that last post where they said they would have trouble recovering the data, I contacted them and said we have resources and so on that we could help them it. But from there the discussions continued and went forward about buying the assets.”

Specifically, Bloch says the most recent Distribute.IT post in which it said four servers had lost all their data, with little hope of recovery. The company has since handed over control of that blog to NetRegistry, with a post being made today from chief operating officer Bret Fenton.

“We are reviewing the lost data to see what can or can’t be recovered. In the meantime we’ll provision new hosting accounts on the console for those clients, give them logins and invite them to load anything they have available in addition to creating mailboxes,” he said.

The acquisition is only for the assets of the company, not the legal entity. But Bloch says they’ll be a great asset to NetRegistry, especially as it attempts to move into the cloud-computing sector more and more.

“Obviously they have a sizeable market share, about 7% of the .com.au domain name market. That’s obviously been a key market for us, and since they have a significant amount of hosting as well, that’s a key asset. They have quite a large number of servers. “

Bloch says NetRegistry is also moving into cloud computing products, such as accounting software, and says assets gained in the Distribute.IT deal will help it roll-out new products.

While he would not disclose a purchase price, he says the amount is “hopefully sufficient to get them back on their feet”.

“I wanted to help. I’ve known these guys for a long time, and it really couldn’t happen to people less deserving. And certainly there were concerns from the founders about what the future might hold for them.”

But Bloch says the incident serves as a warning – hackers are no longer attempting to just gain confidential information, but instead are simply destroying websites for the sake of showing off.

“It’s very unusual for attacks to be as malicious as this, usually it’s dealing with credit card theft and so on. But defacing a website and putting up messages about how they’re the best hackers in the world is quite unusual. And worrying.”