Digital Realty has announced it is to acquire Interxion in an $8.4 billion (£6.52bn) transaction which is touted as the largest data centre deal in history.

Interxion, a provider of European colocation data centre services, will join the Digital Realty team to create a ‘leading pan-European data centre presence’. The companies estimate the combined entity will cover more than two thirds of the GDP in Europe, with Interxion currently holding 53 carrier- and cloud-neutral facilities across 11 European countries.

The companies claim various benefits of the transaction: building upon Digital Realty’s record in hyperscale development and its associated benefits for enterprise customers is cited, as well as solving the public and hybrid cloud architectural requirements of a global customer base.

Digital Realty’s CEO, A. William Stein, will serve as chief executive of the combined company, while Interxion CEO David Ruberg will head up the EMEA business.

The deal beats Digital Realty’s own record when it purchased DuPont Fabros for $7.6bn in 2017.

“This strategic and complementary transaction builds upon Digital Realty’s established foundation of serving market demand for colocation, scale and hyperscale requirements in the Americas, EMEA and Asia Pacific and leverages Interxion’s European colocation and interconnection expertise, enhancing the combined company’s capabilities to enable customers to solve for the full spectrum of data centre requirements across a global platform,” said Stein in a statement.

Consolidation of the market was to be expected, according to analyst firm Synergy Research. In a note at the beginning of this year, the company said it expected to see ‘a lot more’ data centre M&A over the coming five years. Analysis of the transactions over the past two years saw a significant dip in overall value in 2018 compared with 2017, despite a greater number of deals.

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Alphabet posted earnings which missed analyst expectations – yet as the company’s ‘other revenues’ bucket continues to grow, the word on Google Cloud remained positive from the executives.

Other revenues, of which Google Cloud is a part – the company continues to not show its full hand – reached $6.42 billion (£5.01bn) for Q319, an increase of 38.5% year on year and a rise of almost 4% from the previous quarter.

Profit for the overall business declined 23%, with the earnings of $10.12 per share falling well below Wall Street expectations of $12.42. However, total revenues of $40.5bn were seen as positive, with advertising revenues up 17% from this time last year.

Google Cloud’s highlights in Q3 were varied and legion. In terms of product and footprint, the company continued its European expansion with a launch in Poland last month, while the release of Dataproc on Kubernetes in the same month solidified Google’s leadership at container management for an enterprise level. On the partnership front, deals were struck in August with VMware, extending the companies’ collaboration, as well as with enterprise blockchain provider Cypherium.

Alphabet CEO Sundar Pichai was keen to evangelise the gains made by Google Cloud, particularly noting ‘customer momentum across multiple areas on [Google Cloud CEO] Thomas [Kurian’s] leadership’ to analysts.

Pichai elaborated on how Google Cloud customers fit in to other emerging areas when fielding an analyst question around quantum computing, an area in which Google declared ‘supremacy’ last month. “This is an important tool in the arsenal,” said Pichai. “While quantum will take many years to really start making a difference, we want to be at the cutting edge of driving it.

“I do think over time for sure, we do see a lot of interest from Cloud customers, particularly in cutting-edge verticals about quantum computing – so that’s an area where I think [we] will participate in as a business,” added Pichai.

Analysts had previously been asking Google to disclose specific figures around its Cloud business. In Q1, Goldman Sachs analyst Heather Bellini posed that very question, only to get a committed non-committal in response. This is understandable; as each of the cloud infrastructure giants count their beans with different methods, specific numbers may be seen as an apples versus oranges comparison. Microsoft continues to give Azure revenues in terms of percentages rather than an exact number, while AWS – which does give specifics – hit almost $9bn in its most recent quarter.

You can read the full Alphabet earnings release here.

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Analysis The announcement from the Department of Defense (DoD) on Friday that Microsoft had been awarded the long-detailed $10 billion JEDI (Joint Enterprise Defense Infrastructure) cloud computing contract elicited responses of surprise from many in the industry.

The release confirming the contract to Microsoft made for interesting reading. Transparency was the name of the game: the award was ‘conducted in accordance with applicable laws and regulations’, it ‘cleared review by the GAO and Court of Federal Claims’, with all bids ‘treated fairly and evaluated consistently with the solicitation’s stated evaluation criteria.’

Yet one paragraph up, the DoD notes that the award ‘continues [its] strategy of a multi-vendor, multi-cloud environment… as the department’s needs are diverse and cannot be met by any single supplier.’

Arguably the biggest point of discussion around the entire procurement focused on the single or multi-cloud approach. Writing for this publication in August, David Friend, CEO of cloud storage provider Wasabi, made his opinions on multi-cloud clear.

“We will see the cloud market become increasingly decentralised in the years to come, as more specialist vendors spring up to meet specific customer needs at better prices,” wrote Friend. “We just have to hope the JEDI contract doesn’t feed the giant at the expense of the competition being able to grow.”

The contract award has potentially done that, though perhaps not in the way Friend intended. Noting Amazon’s market leadership in cloud infrastructure, an argument can be made that, on business terms, giving this award to a strong, entrenched second player – as Microsoft is – would facilitate a continued competitive market.

The question remains, however: is this single cloud or multi-cloud? AWS has been running the CIA’s cloud for the better part of half a decade; confirmation arrived in February 2015 that it was running on ‘final operational capability.’

Cloud pundit Bill Mew sees it as the latter given AWS’ other commitment – but criticised the procurement process. “A lot of people were arguing that it should be a multi-cloud bid and therefore open up to a number of different competitors,” Mew told CloudTech. “The DoD argued the reverse – we need one supplier simply because we need the level of tight integration and security.

“I totally buy that if that’s their argument – but then why are they not going to the same supplier the CIA have?” Mew added. “There are going to be hundreds of other government sector contracts coming up. You have to think at an overall strategic level within government – is the single cloud approach the one we’re taking or are we actually going to ascribe a multi-cloud approach where we want a healthy market? And if so, why didn’t we set out right at the outset what the interoperability standards are within that environment?”

Rumour and conjecture has been rife regarding the process behind the contract award. Around the time Oracle’s initial legal challenge around its exit from the process was dismissed, President Trump announced he was looking into the contract, citing – as reported by CNBC – “tremendous complaints from other companies.” According to the same publication on Saturday, former secretary of defence James Mattis claims in a new book that President Trump told him to ‘screw Amazon’ out of the contract.

Mew argues that, should AWS challenge this award – the Washington Post cites one legal analyst who said it was a ‘virtual guarantee’ – its case will be ‘far stronger’ than Oracle’s.

“I’m normally somebody who trusts the system, but there’s already been so much of a mess in terms of this procurement, and we have an administration here who have shown themselves to be not entirely unopen to bias,” he said. “One has to have a level of cynicism. I think it will all come out in time.”

One other fact to consider is around the contract itself. $10 billion is a naturally eye-catching number – Microsoft noted in its financials last week ‘material growth’ in $10 million Azure deals – but the contract has plenty of wiggle room. DoD official communications note a two-year base contract period with $1m guaranteed.

“This is an enormous vouch of credibility for Microsoft and Azure – there’s no taking away from how important this is to them,” said Mew. “However, if you look at the contract, it doesn’t mandate that $1bn is spent every year, it is a very flexible framework.”

A statement from AWS read: “We’re surprised about this conclusion. AWS is the clear leader in cloud computing, and a detailed assessment purely on the comparative offerings clearly lead to a different conclusion. We remain deploy committed to continuing to innovate for the new digital battlefield where security, efficiency, resiliency, and scalability of resources can be the difference between success and failure.”

When asked about plans to appeal, AWS did not return comment at publication time.

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Amazon Web Services (AWS) announced revenues of almost $9 billion for the most recent quarter – but growth fell on last year's totals meaning a more subdued outlook.

AWS posted $8.99bn (£7bn) for Q319 at a growth of 35% year on year – however this compares with 37% growth for Q219, and a 46% growth rate for this time last year. Amazon's cloud arm now represents 12.8% of Amazon's overall revenues, compared with 11.8% for the previous year's quarter.

Naturally, many of the analyst questions focused on the performance of AWS. Stephen Ju, of Credit Suisse, enquired around the long-term potential margins, saying it 'pretty much sold itself' to begin with and noting the sales and marketing increases with potential engineering hire downturns.

Brian Olsavsky, Amazon chief financial officer, noted the increasing importance of long-term commitment in terms of pricing. "Our margins expectations are that we will price competitively and continue to pass along pricing reductions to customers, both in the form of absolute price reductions and also in the form of new products that will in effect cannibalise the old ones," said Olsavsky.

Various new products were launched among the highlights for AWS in the most recent quarter. AWS Lake Formation, a service which helps customers build data lakes, and fully managed machine learning product Amazon Forecast were the biggest releases. In terms of news, the announcement of Amazon migrating all of its consumer databases from Oracle to AWS – complete with celebrations – earlier this month was of greatest interest.

In the previous quarter, this publication noted that large expectations accompanied large numbers. Growth had again dipped for AWS, which naturally saw pessimism from the analysts. Yet as long-time industry watcher Synergy Research noted, more than 100% growth rates could not carry on forever.

This time round, a note from Synergy was in similar tones. "I've seen some comments expressing worrries over the gradual reduction in annual growth rates but this is not a real concern," wrote John Dinsdale, Synergy chief analyst and research director. "It is a truism that as great scale is achieved, then growth rates will decline. The sequential growth in cloud service spending was around $1.5 billion in Q3, in line with the growth seen in the first two quarters of the year.

"Did someone say the market is weakening? I don't think so," added Dinsdale. "The cloud market is in rude good health."

While Amazon's results were being reported, AWS was under from a DDoS attack which took its S3 storage service, and others, offline for up to eight hours. According to an AWS status at the time: "Between 10:30 AM and 6:30 PM PDT, we experienced intermittent errors with resolution of some AWS DNS nsames. Beginning at 5:16 PM, a very small number of specific DNS names experienced a higher error rate. These issues have been resolved."

You can read Amazon's full financial report here.

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Microsoft has reported revenues of $33.1 billion (£25.7bn) for its most recent quarter, with CEO Satya Nadella emphasising the importance of artificial intelligence (AI) in building out cloud applications.

Writing the headline for Microsoft’s quarterly earnings release requires conforming to some kind of template: ‘Microsoft Cloud [noun] [verb] [quarter] Results’. The noun, usually ‘growth’ or ‘strength’, is optional, as is the word ‘record’ when allowable, while the requisite verb will either be ‘powers’, ‘fuels’, or ‘drives.’

This time round, it is a no-frills “Microsoft Cloud Strength Drives First Quarter Results”, with solid increases across the board. Microsoft’s revenues are placed into three buckets; productivity and business processes, which hit $11 billion (£8.6bn) at a 13.3% increase, intelligent cloud, which was at $10.8bn at a 26.6% yearly increase, and ‘more personal computing’, at $11.1bn representing a 3.6% change. Specific Azure figures are as ever not disclosed, however chief financial officer Amy Hood told analysts there had been ‘material growth’ in the number of $10 million plus contracts in the quarter.

In prepared remarks, Nadella cited the continued growth of Azure powering the rest of Microsoft’s stack – although stopping short of using ‘the world’s computer’, as with the most recent results – yet added a warning. “Organisations today need a distributed computing fabric to meet their real world operational sovereignty and regulatory needs,” said Nadella.

“Every Fortune 500 customer today is on a cloud migration journey, and we are making it faster and easier. We are reimagining customers’ data estates with the cloud era with new limitless capabilities.

“We are accelerating our innovation across the entire technology stack to deliver new value for customers,” Nadella added. “We’re investing aggressively in large markets with significant growth potential, and it’s still early days.”

One area which appears to be gaining traction is through Microsoft 365, the name for the overall suite of ‘productivity cloud’ products. As reported by ZDnet, the company’s ‘Windows commercial products and cloud services revenue growth’ may be the indicator, with that category seeing a particular spike up 26% in Q120 compared to 12% the year before.

“Microsoft 365 is the world’s productivity cloud and the only comprehensive solution that empowers everyone from the C-suite to first line workers with an integrated secure experience on any device,” added Nadella. “We’re infusing AI across Microsoft 365 to help make work more intuitive and natural.”

Microsoft’s highlights from the most recent quarter were varied. The company expanded its cloud data centres to Germany and Switzerland, as well as India, where a major partnership with network operator Reliance Jio was announced in August. Microsoft announced the acquisition of cloud migration tool Movere in September, and most recently secured a partnership with SAP – putting them ahead of their hyperscaler rivals.  

You can read Microsoft’s full results here.

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Big data and analytics platform provider Databricks has announced a $400 million (£310m) series F funding round – putting the company at a more than $6 billion valuation.

The San Francisco-based firm, which helped create big data processing framework Apache Spark, only closed its series E round to the tune of $250m back in February, revealing significant growth. The company’s remit is focused around ‘unified data analytics’, whereby artificial intelligence (AI) technologies are combined with data processing for more tangible, actionable results.

The series F round was led by Andreessen Horowitz’s (a16z) late stage venture fund, with a wide cast list of supporting players, including Coatue Management, Microsoft, and New Enterprise Associates (NEA). a16z has long since been a supporter of Databricks, having claimed upon the series E funding that the company was the ‘clear winner in the big data platform race.’ This time round, a16z general partner David George claimed Databricks’ net revenue retention was ‘astounding.’

So why the additional funding? Like its open source heritage, Databricks has built three technologies based around data management and machine learning. Delta Lake is a storage layer which aims to bring reliability to data lakes, MLflow is a platform for the end-to-end machine learning lifecycle, while Koalas aims to make Pandas, a Python data science tool, more compatible with big data sets.

Databricks is also looking to put €100 million towards its European centre in Amsterdam, with the company saying its engineering hub had already grown by three times over the past two years. The company is looking at further expansion in the Middle East, Africa, Asia Pacific, and Latin America.

“Data teams at thousands of organisations globally are now leveraging our Unified Data Analytics Platform to solve their toughest problems,” said Ali Ghodsi, Databricks CEO and co-founder in a statement. “Our bets on massive data processing, machine learning, open source and the shift to the cloud are all playing out in the market and resulting in enormous and rapidly growing global customer demand.

“As a result, Databricks is among the fastest growing enterprise software cloud companies on record,” added Ghodsi.

Databricks was placed in the top 20 of the most recent Forbes Cloud 100, published in September.

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Big data and analytics platform provider Databricks has announced a $400 million (£310m) series F funding round – putting the company at a more than $6 billion valuation.

The San Francisco-based firm, which helped create big data processing framework Apache Spark, only closed its series E round to the tune of $250m back in February, revealing significant growth. The company’s remit is focused around ‘unified data analytics’, whereby artificial intelligence (AI) technologies are combined with data processing for more tangible, actionable results.

The series F round was led by Andreessen Horowitz’s (a16z) late stage venture fund, with a wide cast list of supporting players, including Coatue Management, Microsoft, and New Enterprise Associates (NEA). a16z has long since been a supporter of Databricks, having claimed upon the series E funding that the company was the ‘clear winner in the big data platform race.’ This time round, a16z general partner David George claimed Databricks’ net revenue retention was ‘astounding.’

So why the additional funding? Like its open source heritage, Databricks has built three technologies based around data management and machine learning. Delta Lake is a storage layer which aims to bring reliability to data lakes, MLflow is a platform for the end-to-end machine learning lifecycle, while Koalas aims to make Pandas, a Python data science tool, more compatible with big data sets.

Databricks is also looking to put €100 million towards its European centre in Amsterdam, with the company saying its engineering hub had already grown by three times over the past two years. The company is looking at further expansion in the Middle East, Africa, Asia Pacific, and Latin America.

“Data teams at thousands of organisations globally are now leveraging our Unified Data Analytics Platform to solve their toughest problems,” said Ali Ghodsi, Databricks CEO and co-founder in a statement. “Our bets on massive data processing, machine learning, open source and the shift to the cloud are all playing out in the market and resulting in enormous and rapidly growing global customer demand.

“As a result, Databricks is among the fastest growing enterprise software cloud companies on record,” added Ghodsi.

Databricks was placed in the top 20 of the most recent Forbes Cloud 100, published in September.

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SAP has announced the launch of a more detailed cloud partnership with Microsoft – showing how the German software giant’s Embrace project is gaining traction.

Embrace, first announced in May, is SAP’s blueprint to help customers become ‘intelligent enterprises’ by utilising the hyperscaler public clouds of Amazon Web Services (AWS), Microsoft Azure, and Google Cloud. This includes reference architecture based on various industry verticals, as well as value added services for customers running a cloud-based or hybrid infrastructure on a hyperscaler platform.

This extended partnership with Microsoft, billed as a ‘preferred cloud’ deal, will aim to speed up customer adoption of app development product SAP Cloud Platform and ERP bulwark S/4HANA on Microsoft Azure.

SAP confirmed to CloudTech that there were no similar programs planned with the other hyperscalers right now.

Project Embrace on Microsoft Azure will have a three-pronged strategy for customers; simplifying the move from SAP’s on-premise ERP to S/4HANA, creating a ‘roadmap to the cloud for customers in focused industries… with a path to streamline implementation’, providing a combined support model, alongside the reference architectures, put together with system integrator partners.

SAP – alongside other companies including VMware – have taken on board the ‘if you can’t beat them, join them’ adage around the largest public cloud providers. At VMworld back in August, VMware touted the fact it had partnerships set up with five of the biggest clouds, including IBM and Alibaba. Oracle came in the following month.

While the potential for collaboration between the Microsofts and Amazons to tap into VMware and SAP’s customer base is impressive, expect some jockeying for position within these frameworks going forward.

Bruce Milne, CMO at hyperconverged infrastructure provider Pivot3, told this publication immediately after the VMworld keynote in August: “There’s an obvious strategic tension in VMware’s collaboration with the hyperscale cloud providers, but for now it appears they’ve agreed to a collaborative détente. Watch this space because that friction is sure to generate sparks eventually.”

Microsoft had seen to be more active in promoting this initiative than others. A blog post from May 9, the day Embrace was first announced, said the Redmond firm would be the first global cloud provider to join the program. SAP’s official note on the same day cited all three hyperscalers, along with unnamed ‘global strategic service partners’.

SAP has also announced its third quarter 2019 results, with the gradual move from on-prem to cloud-based revenues continuing. Cloud revenue went up 37% year on year, while cloud and software revenues went up 12%, and total revenues 13%. A statement from chief financial officer Luka Mucic noted that “despite continued macro uncertainties we couldn’t be more confident to make 2019 another stellar year for SAP.”

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Amazon Web Services (AWS) claims it has fully migrated its consumer databases from Oracle to its own offerings – but don’t expect the mudslinging between the two companies to end just yet.

Jeff Barr, AWS evangelist, took to the Seattle giant’s official blog to confirm the last Oracle database had been turned off. AWS claims it has reduced its database costs by more than 60%, latency of consumer-facing applications was reduced by 40%, and database admin overhead went down by 70% moving to managed services.

“Over the years we realised that we were spending too much time managing and scaling thousands of legacy Oracle databases,” wrote Barr. “Instead of focusing on high-value differentiated work, our database administrators spent a lot of time simply keeping the lights on while transaction rates climbed and the overall amount of stored data mounted.”

This was by no means the only snarky remark. AWS went to the trouble of creating a video, complete with cheers, encapsulating the moment when the final Oracle DB was switched off (below), while the slide which accompanied Barr’s blog, albeit lacking somewhat in detail, was captioned ‘bye bye Oracle’.

Regular watchers of AWS and Oracle keynotes will recall various claims made by one company against the other. Only last month Larry Ellison’s OpenWorld keynote in San Francisco, which touted the company’s autonomous, next-generation cloud, compared variously with Amazon’s position on shared responsibility – a concept which Oracle is looking to eradicate.

Last November, AWS chief executive Andy Jassy noted that AWS had turned off its last Oracle data warehouse at the beginning of that month, and added that almost 90% of all databases had moved to cloud-based relational database Aurora and non-relational database DynamoDB.

The overall migration project was not limited to switching off databases. Barr added that employees who focused primarily on Oracle database admin work were retrained on AWS, as well as ‘cloud-based architectures’ and cloud security. “They now work with both internal and external customers in an advisory role, where they have an opportunity to share their first-hand experience with large-scale migration of mission-critical databases,” wrote Barr.

AWS did note that some third-party applications were ‘tightly bound’ to Oracle and were therefore not migrated.

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OVH has announced it is changing its name to OVHcloud to mark the company’s 20th birthday – and double down on its ambitions.

The move was announced at OVH's annual jamboree, renamed this year from #OVHSummit to #OVHcloudSummit.

The company has long-held a goal to provide an alternative to the cloud hyperscalers for the European market. OVHcloud cites clarity as the primary reason for changing name: the company claims more than 70% of its revenue is ‘focused on cloud solutions.’ “By adopting the name OVHcloud, the group is aligning its identity with its business development strategy, in order to support its international growth,” the press materials note.

OVHcloud’s primary marketing is an acronym around the ‘smart’ cloud: any solution needs to be simple to implement, multi-local, accessible and predictable, reversible and open, and transparent. It is the reversibility – to ensure organisations avoid bill shock and vendor lock-in, which is particularly key, according to CEO Michel Paulin.

In a recent interview with CIO India (cached), Paulin outlined the rationale, while not naming names. “Many cloud players make it difficult or impossible for their customers to move their data out of the cloud. However we believe that customers should be free to move the data out as and when they want,” said Paulin. “The concept of reversibility is not just beneficial for the customers in the long term but will also make the multi-cloud strategy feasible.”

Writing for this publication in February, Paulin expanded further on his company’s multi-cloud ethos. “From speaking to our customers, combining on-premise and cloud infrastructure with a multi-cloud strategy has allowed them to connect to networks in a totally isolated and secure way, via numerous points of presence around the world,” Paulin wrote.

“What’s more, I’ve noticed how it has allowed organisations to shift to the cloud at their own pace and take a flexible approach – all while responding to their strategic objectives,” Paulin added. “This means businesses can control and run an application, workload, or data on any cloud based on their individual technical requirements.”

OVHcloud is looking at various industries, as well as smaller businesses, to help it differentiate. The company’s Cloud Web hosting product line, for instance, is aimed at developers and agencies. At the other end of the scale the company is promising an enriched bare metal portfolio for its enterprise solution base to provide greater performance and automation capabilities.

While Paulin noted in a statement that the company wants its brand to reflect the reality of cloud around the world, industry watchers may be wary of such nomenclature. In the much more nascent blockchain space, companies have been adding the buzzword to their name before changing their mind. The most recent was Blockchain Power Trust, which changed its name last week to Jade Power Trust after the company officially ceased cryptocurrency mining operations.

You can view the full #OVHcloudSummit keynote here (English version).

Picture credit: OVHcloud/Screenshot

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