Data Center Giant Equinix To Acquire Packet To Drive Edge Computing Capabilities

'The incorporation of Packet into Equinix will accelerate the delivery of enhanced edge services to Equinix's growing customer base, while continuing to serve the developer community that has come to rely on Packet's unique offering,' says Packet CEO Zachary Smith.

Equinix is set to acquire bare metal automation startup Packet in a move to create a new offering that allows businesses to rapidly deploy digital infrastructure while also bolstering the data center colocation giant’s edge computing capabilities.

"Packet's innovative and agile bare metal service, and neutral approach to software stacks, fit our own cloud-neutral model and match our strategy for helping enterprises flexibly deploy digital infrastructure, within minutes, at global scale,” said Sara Baack, chief product officer at Equinix, in a statement. “By acquiring Packet, we are making it easier for enterprises to seamlessly deploy multi-cloud solutions at Equinix and extract greater value from our rich ecosystems and global interconnection platform.”

The Redwood Shores, Calif.-based data center specialist Tuesday signed a definitive agreement to acquire Packet, which provides customized hardware configurations that compete with public cloud players including Amazon Web Services and Microsoft Azure.

Equinix plans to leverage the New York-based startup to accelerate its strategy to help enterprises more seamlessly deploy hybrid multi-cloud architectures on its Platform Equinix architecture as well as accelerate the development and delivery of its interconnected edge services.

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Terms of the deal were not disclosed. Equinix expects to complete the acquisition of Packet during the first quarter of 2020.

Packet provides a bare metal automation platform for developers that lets users consume infrastructure at scale, handling the complexity of automating infrastructure no matter where it is, where it lives or who owns it. The company’s mission is to empower developer-driven companies to deploy bare metal servers at global scale with cloud, hybrid cloud, on-premises and edge computing solutions.

"We started Packet in 2014 with a vision to redefine the next wave of cloud with a focus on the distribution and automation of fundamental infrastructure,” said Packet CEO Zachary Smith in a statement. “This dovetails perfectly with Equinix's strategy for helping enterprises implement new digital architectures in a growing number of edge locations. The incorporation of Packet into Equinix will accelerate the delivery of enhanced edge services to Equinix's growing customer base, while continuing to serve the developer community that has come to rely on Packet's unique offering."

By combining Packet's developer-oriented bare metal service offering with Equinix's interconnection capabilities and bare metal efforts, Equinix intends to create an enterprise-grade bare metal offering across Platform Equinix that allows customers to rapidly deploy digital infrastructure within minutes at scale.

Platform Equinix is the company’s flagship data center and interconnection platform for enterprises deploying hybrid multi-cloud at the edge. With a global footprint of more than 200 International Business Exchange data centers, Platform Equinix contains the highest share of the world's public cloud on-ramps and the most physically and virtually interconnected ecosystems in the world, according to Equinix.

By acquiring Packet, Equinix will add important new on-demand deployment alternatives that meet the market's full range of use cases. With a combined Equinix and Packet offering, enterprises and service providers will be able to build and deploy low-latency services at the edge either through their choice of owned physical deployments, or by utilizing the combined offering, which leverages as-a-service consumption to reduce Capex and resource requirements.

Equinix had a very busy 2019 in terms of M&A and investments.

The company embarked on a $1 billion venture last year to develop hyperscale data centers throughout Europe, while at the same time entering the Mexico data center market through its $175 million acquisition of Axtel SAB data centers. To scale to the needs of hyperscalers, Equinix created xScale data centers to provide access to Equinix’s suite of interconnection and edge services that tie into hyperscale companies such as AWS, Microsoft and Google’s existing access points at Equinix.

Equinix’s Baack said the latest acquisition of Packet will drive net-new sales in 2020. “Our combined strengths will further empower companies to be everywhere they need to be, to interconnect everyone and integrate everything that matters to their business,” she said.