Akamai’s Differentiated Cloud Strategy

Last week, we unveiled Akamai Connected Cloud, our massively distributed platform for cloud computing, security, and content delivery. You can read all the details in our announcement.

Akamai is taking a fundamentally different approach to the cloud computing market than providers who base their platforms solely on core data centers. Our strategy is to offer the world’s most distributed platform, placing compute, storage, database, and other cloud services closer to end users and enterprise data centers.

As IDC’s VIce President of Research Dave McCarthy says:

“The cloud’s next phase requires a shift in how developers and enterprises think about getting applications and data closer to their customers. It redefines how the industry looks at things like performance, scale, cost, and security as workloads are no longer built for one place but are delivered across a wide spectrum of compute and geography.”

IDC adds that:

“Akamai’s innovative rethinking of how this gets done — and how it is architecting the Akamai Connected Cloud — puts it in a unique position to usher in an exciting new era for technology and to help enterprises build, deploy, and secure distributed applications.”

We couldn’t agree more. Distributed applications require a distributed architecture.?

Distributed applications require a distributed architecture

Akamai’s leadership position at the edge of the internet enables us to scale just about everything we touch.

We scale content, putting digital experiences closer to users than anyone.

We scale cybersecurity, keeping threats farther away from business and people.

And now, we’re building on Akamai’s 25 years of experience with scaling and securing the internet for the largest enterprises in the world — so we can scale cloud computing and provide better performance at lower cost.

That’s what Akamai customers told us they want from us, as Adam Karon, head of Akamai’s Cloud Technology Group, explains in his blog post about our announcement.

Better performance, with better economics

Although we still have much work to do, we’re encouraged by the reaction from customers who want to realize the value of our approach.

A well-known digital fitness platform brought business to us that they previously did with a major cloud provider. They chose Akamai Connected Cloud because we can optimize their performance and provide better economics.

When a gaming company suffered a distributed denial-of-service (DDoS) attack that took out their Internet Relay Chat servers, they turned to Akamai Connected Cloud to get back online. After utilizing Akamai Connected Cloud for a few weeks, they also migrated their peer-to-peer matchmaking servers to Akamai. This is what they say to other gaming businesses with similar use cases:

“Our adoption of Akamai’s cloud computing solution was painless and turnkey. Akamai has a great backbone network, and the connective layer between our global servers has been rock solid. With Akamai’s extensive global network, we provide a better experience to our gamers by delivering from the edge and reducing latency. With Akamai, there's no reason to go anywhere else."

Synergy between our cloud computing, security, delivery?

As you can see from this example, there is a strong synergy between our emerging cloud computing business and our delivery and security businesses. We believe that integrating these cloud computing solutions with our unique edge platform will allow us to offer customers better performance, greater scale, and lower cost for enterprise workloads.

Major media companies, in particular, have expressed significant concerns with their growing use of the giant clouds. Not only are the costs high, in part because of the fees from moving data from cloud storage to a CDN for delivery, but they're also concerned about their increasing reliance on a direct competitor for cloud services.?

In fact, one of the earliest enterprise customers to try Akamai Connected Cloud is one of the world's largest social media companies. They selected us after a bakeoff against their existing hyperscale cloud services provider.

Alexander Leschinsky, CEO of G&L, a German systems integrator working with the country’s leading broadcasters and streaming services, says,?

“Akamai Connected Cloud and the new distributed locations to be launched globally align perfectly with what we love most about Akamai: providing the ultimate distributed edge and cloud platform. G&L is using Akamai to extend our custom multicloud media stack with ease, reliability, and cost efficiency, helping us to provide unbeatable value to our clients.”

Ambitious build-out of our cloud computing infrastructure

To bring value to more customers around the world, we are focused on an ambitious build-out of our cloud computing infrastructure this year.

Akamai Connected Cloud currently links the 11 core data centers that we acquired from Linode in 2022 with Akamai’s 4,100 edge-computing locations. In addition, we’re in the process of building out 14 more core enterprise-scale data centers, with at least three expected to come online in the next few months.

We also plan to have our new virtual private cloud capability and the first of more than 50 distributed cloud computing sites available in the second half of the year.

The distributed sites will enable us to bring cloud computing much closer to end users around the world, which will further enhance the performance benefits of Akamai Connected Cloud.

We're also in the process of retasking about 10% of our workforce to spend the majority of their time working on the development, deployment, support, and go-to-market efforts associated with Akamai Connected Cloud.??

We’re undertaking this ambitious investment in Akamai Connected Cloud because we see a strong need for it in the marketplace, and because we believe it will create substantial value for our customers and shareholders.?

We expect to achieve nearly $500 million in revenue from cloud computing in 2023. And the investment we are making this year should help drive that number substantially higher in 2024 and beyond, as we use the new capabilities and capacity to support mission-critical enterprise workloads.