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Thursday, September 22nd, 2016
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Digital Realty Challenges Equinix With Cloud Connectivity Platform In a move aimed at evening the score between itself, the colocation space leader, and Equinix, which leads in colocation market share, Digital Realty Trust is preparing to launch its own cloud connectivity platform.
Digital Realty Service Exchange will enable private, direct connections between enterprise data centers and the Big Three public cloud providers: Amazon Web Services, Microsoft Azure, and Google Cloud Platform. Through a deal with Australia-based SDN-enabled interconnection provider Megaport, which already links many data center customers to public clouds such as Azure, Service Exchange will immediately have a somewhat established cross-connect ecosystem when the service becomes generally available in eight North American markets on November 4.
Digital made the announcement at its MarketplaceLIVE conference in New York City on Thursday.
“Service Exchange, like what we’re seeing with other competitive exchanges, is a global interconnection platform,” said Sean Iraca, DR’s vice president for service enablement — making certain not to say “Equinix Cloud Exchange” too loudly.
Enter Megaport
Megaport appealed to Digital Realty as a partner, Iraca said, for the robustness of its existing SDN platform, including its resource usage reporting, its automated provisioning, and naturally, its existing connections with CSPs. That company went public on the Australian exchange just last December, and since then began making its SDN interconnection services available through other distributors, including EdgeConneX, and Aussie provider Synnex.
With this new cloud connectivity partnership, he continued, Megaport officially becomes Digital Realty’s SDN provider. But along with that deal comes some key components of Megaport’s underlying platform.
“They also have a really unique billing model that aligns more with the way enterprises are looking to consume services. They want them to be more dynamic, to be able to self-manage, to procure, to upscale and de-scale. And oh, by the way, they want to be billed in something closer to a usage-based billing model.”
Digital Realty has been pushing for what it calls the “connected campus:” large-scale deployments among multiple locations through a single service provider, often within the same facility or metropolitan area. Such a dense connection can be facilitated, Iraca suggested, through a cross-connection fabric hosted by Service Exchange. The new billing model he discussed would then become elastic, according to the specific resource consumption patterns for bandwidth and power.
Connectivity Options
After its nearly $2 billion acquisition of Telx last October, Digital Realty merged Telx’ Marketplace portal into its own. As a result, noted Iraca, it gained a robust automation platform for managing cross-connects, along with what he described as a “Who’s Who” of providers with whom such cross-connections can be made.
The Megaport partnership now adds more cross-connect options, as well as what he described as a robust back-end API — one he acknowledged may be simpler to use than what Digital already had. Through a portal connecting with that API, a Service Exchange customer should be able to track resource usage through a variety of metrics, such as per-VLAN and per-port.
Before launching this service, Iraca said, Digital Realty equipped the edges of its network connections to Megaport facilities with redundant switching fabric. “That gives our customers not only the ability to leverage the redundancy within the network elements of Megaport,” he said, “[but] the ability to architect a redundant infrastructure within the data center itself — not only across the switching fabric and network. Leveraging the Megaport network, I can also architect for geo-redundancy.”
Bridging to Megaport should expand these geo-redundancy options beyond Digital Realty’s own footprint. It lists Service Exchange’s availability regions on November 4 as including Atlanta; Ashburn, Virginia; Chicago; Dallas; Los Angeles; New York City; San Francisco; and Seattle. The company has plans to add London and Phoenix by the first quarter of next year, plus Miami, Portland, Amsterdam, Dublin, and Singapore by Q2.
That Ashburn location, located in one of the world’s largest cloud data center clusters, is especially critical for cloud connectivity — so much so that, during Digital Realty’s last quarterly conference call in July, Chief Operating Officer Jarrett Appleby essentially gave away the news of Service Exchange’s location strategy, in response to an analyst’s question.
Referring to the proximity between Digital’s own campus facilities and those of the big CSPs, Appleby remarked, “Having colocation now on the campus in Ashburn and Richardson next to the leading cloud service providers is high-value. We’re seeing several wins in that. We do need that Service Exchange that provides those new connectivity options.” [Our thanks to Seeking Alpha for the transcript.]
Meanwhile, Megaport has already been making inroads in service availability to Europe. Last month, it signed an agreement to acquire the parent company of ECIX, Berlin-based Peering GmbH, plus Bulgaria-based OM-NIX. That brought its European network footprint, Megaport says, to 57 locations in 13 countries, spanning from Ireland to Russia.
The Challenger, at Last
For many of the largest enterprises, up until interconnections became a market, the whole “cloud” metaphor was not making that much sense. “Cloud” is supposed to be about workload portability, which ends up being a lot less feasible when your infrastructure is all in one place — whether it be your place or theirs.
Equinix has effectively pioneered that market to date, to the extent that some analysts appeared to be framing Equinix Cloud Exchange as the entire global market for public cloud interconnection. Digital Realty’s executives had already made clear to analysts, well prior to Thursday’s announcement, that it had ground to make up, and it needed to build a competitive service to do so.
One might surmise such an aggressive project would require further public cloud interconnection partnerships down the road — say, with the likes of Salesforce or IBM. Iraca would only go so far as to say such partnerships are in the formative stages today, but are not ready for public disclosure just yet.
Correction: In a note to Data Center Knowledge, Megaport is making clear that its SDN services in this instance are not based on OpenDaylight. | | 4:58p |
Apptio Bets Love for CIOs Will Attract Investor Enthusiasm for Shares (Bloomberg) — While some tech industry watchers have been predicting the death of the CIO for years, Apptio Inc. believes so strongly in the role that it’s built an entire business around it.
Apptio makes cloud software that helps corporate chief information officers track, plan and analyze information technology investments. The business caught the eye of venture capital firm Andreessen Horowitz back in 2009 — it was the shop’s very first investment.
Now, it’s asking public market investors to buy into the idea as it aims to raise as much as $90 million when it prices its initial public offering Thursday, after the market closes.
Apptio is one of the few shots investors have had this year to buy into new technology company shares, with only five venture capital-backed companies in that industry going public so far in 2016. Bellevue, Washington-based Apptio is hoping the enthusiasm shown by customers like Cisco Systems Inc. and Etihad Airlines Group for its product will be mirrored in the deal.While both the number of venture-backed tech deals and the amount raised through September have fallen by more than half compared to 2014, the stocks of those that have gone public have climbed an average of 193 percent.
We at DCK also care about the CIO’s role. Here are some recent CIO interviews we’ve done in the data center space:
Apptio calls its software Technology Business Management, or TBM — a term it’s tried to create a category around. The company has started a TBM Council comprised of CIOs and runs a set of conferences to drum up business.Etihad uses the software to track what it pays and the level of usage and service it gets from outside technology providers, letting the company alter spendy behaviors among employees or negotiate better rates with suppliers, said the airline group’s CIO, Robert Webb.
“For mobile telephony for example, we saw people that were on the wrong rate plans and people with $25,000 phone bills because they are roaming all the time,” he said in an interview. Webb was also an Apptio customer as CIO at Hilton Worldwide Holdings Inc. and served as chief executive officer of the TBM council.Apptio, whose rivals include VMware Inc. and ServiceNow Inc., as well as custom products and spreadsheets, saw total revenue climb 21 percent to $129.3 million in 2015. About three quarters of sales come from subscription products.
Still, the company expects its revenue growth rate to decline, according to its IPO prospectus. The company is also not profitable, with its $41 million loss last year widening 25 percent from a year earlier.
After its initial investment in Apptio, Andreessen Horowitz has put money in every funding round since, said Ben Horowitz, the VC firm’s co-founder. Horowitz and Apptio CEO Sunny Gupta met when the former — then CEO of Opware Inc. — acquired Gupta’s startup.
Apptio filled a need as CIOs switch jobs frequently, are often only noticed when something goes wrong and can find it difficult to explain the value of their work when things go well, Horowitz said.
“The CIO was like the cobbler whose children had no shoes — the CIOs basically had no tools and no way to understand their own business,” he said. “For the first time the CIO can say here’s all the services we’re supporting, here’s how we’re doing it, here’s what it’s costing and here’s the return on it.”
Apptio marketed 6 million shares at a range of $13 to $15 apiece. Goldman Sachs Group Inc., JPMorgan Chase & Co. and Bank of America Corp. are leading the IPO.
The company has attracted devoted fans like Ralph Loura, now CIO at skincare company Rodan & Fields, who first used the software during his tenure at consumer goods maker Clorox Co. After moving to Hewlett-Packard in 2014, Loura again called on Apptio when the computing giant decided to split in two, using it strip out the IT operations and contracts that should be housed in each part of the business.
At Clorox “we had a small army of financial analysts that were building Excel pivot tables to help me understand what was happening in IT and to complicate that I had third party billing coming in,” Loura said. “Apptio was a godsend in a way.”
Still, to keep growing Apptio needs to seek new markets. Apptio will target mid-size customers and look to expand in Europe, Horowitz said. Three-quarters of revenue is from North America, CEO Gupta said in the company’s IPO roadshow presentation.”We had such a rough period of IPOs for a while so the financial standard for going out has become much higher and so when companies go out they’re of very high quality,” Horowitz said.Bloomberg LP, the parent of Bloomberg News, is an investor in Andreessen Horowitz.
The company plans to use anonymized data that it’s collected via its services to enable companies to benchmark themselves and gain insights. And Apptio will add products for other parts of the company besides the CIO’s office, such as human resources, legal and facilities, CEO Gupta said.
Expanding to more areas of a company will be critical for growth a few years down the line, said Etihad’s Webb.
“CIO is big enough. For now,” he said. | | 6:39p |
US Data Center Construction Update September turned out to be a big month for big data center construction project announcements in the US. Facebook has finally decided to build in New Mexico, SAP is stepping into Colorado Springs in a big way, and data center providers Data Foundry and TierPoint are expanding their empires in Texas.
Here are the details:
New Mexico Scores $250M Facebook Data Center Build
After a tax-break war with the State of Utah, New Mexico has secured a commitment from Facebook to build its next data center in the Village of Los Lunas.
The first phase of construction, expected to start later this year, will produce a 510,000-square foot facility and cost about $250 million, according to a joint statement by Facebook and the office of New Mexico Governor Suzana Martinez. Facebook is likely to continue expanding in this location in the future as it does in its other data center locations.
The company has selected Fortis Construction as the general contractor for the project. Fortis also built Facebook’s first company-owned and operated data center, located in Prineville, Oregon.
Facebook expects to start serving traffic from Los Lunas starting in October 2018.
Read more: Everything You Wanted to Know About Facebook Data Centers
SAP Building Huge in Colorado Springs
SAP America, US subsidiary of the German enterprise software giant SAP SE, has selected Colorado Springs as the location of two massive-scale future data centers.
The company recently bought two plots of land – one on the northern side of town and the other on its southern side – for $3 million each, Colorado Springs Gazette reported. The north-side plot neighbors data centers by Progressive Insurance, FedEx, and Walmart.
First phase of the data center build in the north will provide about 41,000 square feet and room to add another 60,000 square feet in the future, according to planning documents reviewed by The Gazette. The project in the south is similar in scope.
In an interview, an SAP official told the newspaper that Colorado Springs was attractive to the company because of its efficient power supply, favorable climate, and availability of a quality workforce.
Data Foundry to Kick Off $200M Build in Austin
Data Foundry is preparing to break ground on the third data center in Austin, which is where the company is based. The future facility, called Texas 2, will go up on the company’s data center campus called Data Ranch, home to its Texas 1 data center.
It expects to have invested about $200 million by the time all three planned construction phases are complete, ultimately delivering 165,000 square feet of raised floor in a 325,000-square foot facility.
Phase One, due to start this this quarter, will “tentatively” launch in the third quarter of 2017, Data Foundry said in a statement.
While there are other types of data centers in the Austin market, it is an especially desirable location for disaster recovery facilities, according to the data center provider. That’s primarily because the area rarely sees natural disasters and has its own power grid, independent from US national grid.
Compass to Build TierPoint’s 40th Data Center in Dallas
TierPoint, the company that started six years ago as Colo4Dallas, a local service provider in Dallas with a single data center, announced a plan for its 40th facility – a 90,000-square foot data center in Allen, Texas.
The site’s first phase will provide 16,000 square feet of raised floor and cost about $20 million, the company said. Dallas-based Compass Datacenters will build the facility for TierPoint.
Located about 25 miles north of Dallas, Allen is a high-tech community with easy access from pretty much anywhere in North Texas, according to TierPoint. The facility will serve as a good disaster-recovery option for its current customers as well as a place to expand IT infrastructure capacity, the company said.
Read more: How TierPoint Quietly Built a Data Center Empire in Secondary Markets | | 9:01p |
Yahoo Says at Least 500 Million Accounts Breached in Attack (Bloomberg) — Yahoo! Inc. said the personal information of at least 500 million users was stolen in an attack on its accounts in 2014, exposing a wide swath of its roughly 1 billion users ahead of Verizon Communications Inc.’s planned acquisition of the web portal’s assets.
The attacker was a “state-sponsored actor,” and stolen information may include names, e-mail addresses, phone numbers, dates of birth, encrypted passwords and, in some cases, un-encrypted security questions and answers, Yahoo said Thursday in a statement. The continuing investigation doesn’t indicate theft of payment card data or bank account information, or unprotected passwords, the company said. Affected users are being notified, accounts are being secured, and there’s no evidence the attacker is still in Yahoo’s network, it also said.
“Yahoo is working closely with law enforcement on this matter,” the company said in the statement. “Online intrusions and thefts by state-sponsored actors have become increasingly common across the technology industry.”
The disclosure of the data theft comes at a particularly sensitive time for Chief Executive Officer Marissa Mayer, as she navigates the company toward a planned $4.8 billion acquisition by Verizon, set to close by early next year. Mayer, who has dealt with difficulties and complaints about Yahoo’s e-mail service in the past, needs to keep users logging in to drive traffic and draw the advertising that fuels the company’s revenue growth, which has been sluggish under her leadership.
Verizon was notified of the incident within the last two days, the company said in an e-mailed statement.
“We understand that Yahoo is conducting an active investigation of this matter, but we otherwise have limited information and understanding of the impact,” Verizon said in an e-mail. “We will evaluate as the investigation continues through the lens of overall Verizon interests, including consumers, customers, shareholders and related communities.”
‘Epidemic’
The confirmation that accounts were compromised came almost two months after the company said it was investigating claims that a hacker was offering to sell user account details stolen in a data breach. The same hacker, who previously sold data taken from LinkedIn and MySpace, posted information from 200 million Yahoo accounts on a dark web marketplace, Motherboard reported in early August. The stolen information being offered was most likely from 2012, Motherboard reported, citing the hacker, who uses the name Peace.
“All of this compromised information is very useful for criminals in order to hijack user identities and use them for fraudulent purposes,” Avivah Litan, an analyst with Gartner, said. “Identity impersonation has become a global criminal epidemic and there are no simple solutions.”
Yahoo is encouraging users to review their accounts for suspicious activity and to change their password and security questions — along with answers for other online accounts where they use the same or similar information. The company also recommends users avoid clicking on links or downloading attachments from suspicious e-mails.
Many of the stolen accounts in a sample of data obtained by Motherboard were no longer in use and had been canceled. The sale of all of the data for just under $2,000 suggested much of the information was obsolete, made up, or useless because the hackers had already attacked legitimate accounts and exhausted their need for the material.
Data Spills
While the breach is a blow to Yahoo, more broadly it underscores the danger of large datasets spilling into the hacker underground and being used for criminal purposes for years without the breached companies knowing, or with them only taking minimal action based on whatever data hackers tell them was taken.
LinkedIn said in May it was investigating whether a breach of more than 6 million users’ passwords in 2012 was bigger than originally thought, following a hacker’s attempt to sell what was purported to be login codes for 117 million accounts. LinkedIn said it appeared more data was taken in the initial attack and that the company was just learning about the larger amount through the hacker’s posting.
Like many internet companies that have been breached, LinkedIn only reset passwords of everyone it believed was part of the breach at the earlier time, which amounted to 6.5 million users. |
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