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It's a familiar story: A major tech vendor buys a small, respected public cloud provider. But amidst a changing market, this one may have a different ending.
Samsung Electronics' planned acquisition of cloud provider Joyent Inc. appears dissimilar from those made by tech companies, such as CenturyLink, IBM and Verizon, that tried to emulate the success of Amazon Web Services (AWS) by acquiring infrastructure-as-a-service providers. With basic compute and storage less of a differentiator in the public cloud market, Samsung instead will leverage Joyent's technology to build its mobile and internet of things (IoT) application business.
Samsung, which also uses OpenStack, will continue to rely on services from the exact companies it would be up against if it were to enter the hyperscale public cloud market -- AWS, Google and Microsoft. Select private cloud services will be moved to Joyent, and the deal appears in line with Samsung's plan to spend $1.2 billion in the U.S. in the next four years on internal research and development and startup investments around IoT.
Joyent, meanwhile, will continue to operate its public and private cloud services as a standalone business. This deal could expand Joyent's reach through Samsung's global data center footprint, but what this will do for Joyent's position in the market or how it will affect existing customers remains to be seen.
Customers take heart, caution
Joyent said it has no plans to abandon its cloud platform and will be in a better position to serve existing customers, thanks to Samsung's backing, but the uncertainty from these types of deals can give users pause as much as hope for an improved service.
Optoro, an e-commerce company based in Washington, D.C., started to move from AWS to Joyent late last year, as the price of running on AWS became prohibitive. Joyent had recently integrated the Docker API with its own container-based platform, which allowed Optoro to create a hybrid implementation: It could run more stable workloads inside its data center, and handle disaster recovery and proof-of-concept testing on the vendor's public cloud.
"I can keep my base running cold predictable costs and use these cloud providers for what they're good for -- on-demand, elastic compute," said Zach Dunn, director of DevOps at Optoro.
Dunn said his gut reaction to the Samsung deal was, "'Oh, crap, this large company just bought a company I have a relationship with.'" Joyent open-sourced its Triton elastic container infrastructure and Manta object storage platform in 2014, and he was concerned Samsung would close-source the technology the same way Oracle tried to do with Solaris.
But after learning more about the deal, and that Joyent was a vocal opponent of that Oracle move, Dunn is reassured that won't happen. It's also possible Optoro could fork its code if it became too concerned about the future of the platform, although the additional resources applied could just as easily help extend the reach of Joyent's underlying technology.
"The analogy I like to use for people is if you look at programming languages, those with corporate backing have always been more successful," Dunn said.
It may be too soon to judge Samsung's long-term strategy, but existing customers should be thrilled Joyent isn't going away due to a lack of scale or investment, and potential customers should feel confident that the platform is unique and has strong financial support, said Dave Bartoletti, principal analyst at Forrester Research.
Still, the potential implications with these acquisitions are always worrisome for users of the platform, said Carl Brooks, an analyst with 451 Research. Eventually, the Joyent brand likely will disappear, so customers should at least be looking at potential migration scenarios, he added.
"Nothing's on fire," Brooks said. "Samsung isn't going to cut anybody off cold, but it would be irresponsible not to take stock of my situation, if I were a Joyent customer."
Joyent's Unix-based SmartOS was seen as being ahead of its time for operating data centers at scale, and Joyent was the early incubator for Node.js. Containers have also been a core part of Joyent's strategy for a decade, and the company built Triton as an infrastructure for Docker containers ahead of many other providers in the market.
Perhaps Joyent was too focused on Node.js and containers before the market was ready for them and never got the major tenants it needed to fund a global buildout, so the Samsung deal will provide much needed capital and focus, Bartoletti said.
"With Samsung's mobile apps as an anchor tenant, the Joyent team can avoid directly competing with the global mega-clouds and instead focus on building out an elastic, on-demand, high-performance, app-focused cloud to serve the massive mobile device market and position Samsung as a cloud innovator," Bartoletti said. Still, it's unlikely it will springboard Joyent into the conversation with AWS, Microsoft Azure and Google Cloud Platform.
Joyent has relied on a marketing-heavy reinvention several times over to remain relevant while leading important innovations in the IT market, Brooks said.
"They could have been another Uber, but they just never had that opportunity," Brooks said. "When they opened up, there wasn't that kind of climate where software automation was that important, and no one was giving hosting companies that sort of money."
Trevor Jones is a news writer with TechTarget's data center and virtualization media group. Contact him at [email protected]
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