Akamai had already expanded its cloud-networking footprint through the purchase of Soha Systems to add security to that business. Adding Linode extends that acquisition-led strategy into cloud hosting aimed at SMBs and independent developers.
The deal also lands in a market where AWS had been broadening its developer tooling through its acquisition of Cloud9. Linode gives Akamai a more direct position with the customer segment that seeks an alternative to AWS.
First-order effects
Akamai gains Linode’s cloud-hosting business and a direct route to SMBs and independent developers for $900M.
Linode’s customers move under Akamai, linking a hosting alternative to Akamai’s existing cloud-networking and security portfolio.
Second-order effects
AWS faces a better-capitalized alternative for smaller cloud customers, while Akamai must turn the combined hosting, networking, and security assets into a coherent offering.
Other cloud providers serving developers and SMBs face a buyer that can use acquisition-led expansion to broaden its infrastructure portfolio.
Third-order effects
If infrastructure and delivery providers continue buying adjacent cloud services, competition will increasingly center on integrated stacks rather than stand-alone hosting or networking products.
The trend: Cloud infrastructure companies are using acquisitions to assemble broader platforms for developers and smaller businesses that want alternatives to hyperscale clouds.
Akamai is buying Linode for $900 million. Akamai says Linode is expected to add $100 million in FY22 revenue and be slightly accretive to non-GAAP earnings by 5 to 6 cents per share https://www.akamai.com/...
So Akamai acquires Linode. That's probably great business for both of them. It essentially stamps out my interest in Linode though. I rather like these mid-size cloud players and them consolidating with big orgs just makes me expect bad things.
Is Linode going to modernize Akamai's API, or is the Linode Terraform provider going to be refactored to use Mechanical Turk to open a ticket with Akamai's existing “Jason API?” https://twitter.com/...
@cloudpundit ... This *could* be a page-turn in the Akamai story, but nothing I've seen so far indicates that they're prepared to do this. “Buying a company so its culture can influence your own” generally results in your culture smothering them to death.
Really interesting development here... lots of us remember @Akamai in the early days of the internet... for the most they have continued on in the background... still very much inline! https://twitter.com/...
Big exit for Philly's Linode. Bootstrapped since 2003, now sold for $900M (Included with purchase: the Real World Philadelphia house) https://technical.ly/... https://twitter.com/...
I would leery of any biz-as-usual assumptions if I were a @linode customer. @akamai targets the enterprise. The mismatch to @linode's customer base is notable, and the earnings call is revealing - https://seekingalpha.com/... https://twitter.com/...