Outages, clouds, AWS, M&A, managed third party cloud
It was another busy week across the sector. It was highlighted by hyperscale cloud outages, some M&A and strategic activity and interesting developments around managed third party cloud.
Amazon’s Prime Day was marred by a significant outage that cost the e-commerce side of the business a large quantity of revenue. Some estimates had the loss at close to $100m. The AWS cloud business was likely to have taken a hit as well. The outage was high profile, but more importantly, speaks to how difficult it can be to scale infrastructure in a hyperscale world. There was also a smaller outage at Google, but it took down some very well known Internet properties.
Amazon also made noise on the strategic side of things as rumours came out that it is looking to get into the networking equipment market. Needless to say, this would have interesting implications.
M&A was relatively quiet, but one transaction closed in Europe. France’s Orange Business acquired Norwegian managed hoster Basefarm. In light of the transaction, we take a closer look at why the telco spinout dynamic is less prevalent in markets outside the US. Another transaction worth noting was Thrive’s acquisition of InfoHedge. This was a good example of how specialized hosting and managed services capabilities are increasing in value.
The managed third party cloud market continues to build and this past week we came across some interesting commentary from Germany’s T-Systems. T-Systems, like many larger integrators/services firms, is moving toward this market as legacy IT service revenues slow and flatten out. Meanwhile, managed third party cloud has gained enough traction for UKFast that it branded a new cloud unit to go after this market.
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