Internap is buying Voxel for that company’s dedicated hosting and cloud services expertise. This is a $30 million cash deal, but another $5 million could be in play should Voxel meet certain objectives.
The deal, which closed on Dec. 30, 2011, could be an early sign that cloud-service consolidation will continue as service providers scramble to gain competitive advantage and heft.
This acquisition specifically should give Internap, which already offers colocation, content delivery network, public cloud, hybrid cloud and managed IP services, a stronger presence in managed hosting, enterprise cloud, dedicated hosting and public cloud services. And, it could give the company better access to smaller business customers. Internap will also get Voxel’s service locations in Amsterdam and Singapore, boosting Atlanta-based Internap’s global presence.
That Voxel presence in Asia and Europe will help Internap jumpstart its public cloud efforts in both regions, said Paul Carmody, Internap’s SVP of product management and product development. Internap had focused its public cloud efforts at the back-office, management layer, using OpenStack to build out those capabilities. Voxel, meanwhile, had concentrated more on the higher level customer-facing portal capabilities of cloud and the hybridization layer. Those two pieces of the puzzle fit together nicely, Carmody said.
Voxel launched its SilverLining cloud computing product to compete with offerings including Amazon’s Elastic Compute Cloud and Rackspace Cloud Servers. That gave the upstart company, which already offered managed hosting services, the same sort of hybrid services that companies like Rackspace offer: dedicated servers combined with cloud computing to handle spikes in traffic or one-off projects, as GigaOM’s Stacey Higginbotham reported at the time.
New York–based Voxel claims 1,000 customers, and Internap, which was the first company out of the chute with an OpenStack Compute–based public cloud offering this fall, claims 2,700.
In a statement on Tuesday morning, Internap said:
Voxel’s dedicated hosting offering provides customers with a robust online interface and comprehensive API that enables them to provision and activate services in minutes, gaining cloud-like flexibility from dedicated physical servers. Moreover, customers can also seamlessly integrate physical servers and cloud instances in the same environment, overcoming a typical barrier to enterprise cloud adoption for use with legacy or complex custom application stacks.
In 2011, there was a lot of M&A activity in the cloud services and hosting space, with Verizon’s buying Terremark for $1.4 billion. And CenturyLink barely took a breath after buying Qwest before buying Savvis. With Internap leading the way, it looks like 2012 will be active as well.