Equinix today said it completed the acquisition of bare metal and edge computing startup Packet, and also disclosed that it paid $335 million in the deal. Meanwhile Zachary Smith, former Packet CEO and co-founder, is now managing director of the interconnection giant’s bare metal business.

The purchase highlights the importance of edge computing, even for a data center behemoth like Equinix with more than 200 data centers in 55 markets globally. But these are typically huge colocation facilities located in major internet hubs such as Silicon Valley, Dallas, and Ashburn, Virginia. And this is why a small, 5-year-old startup like Packet becomes key to colocation and interconnection market leader Equinix.

“This is Equinix being extremely self-aware,” Smith said, using an “Of Mice and Men” analogy. “Lennie doesn’t kill the rabbit.”

“This acquisition really felt like just a natural progression,” Smith said. “The value proposition is the same one that is working so well for Equinix today, which is interconnected mutual ecosystems at global scale is something that people want for their digital businesses. Being able to do that with less friction, easier, and in a more automated way — who wouldn’t like that?”

Why Bare Metal Matters at the Edge

Packet’s bare metal automation technology automates physical servers and networks without the use of virtualization or multi-tenancy. This allows companies to deploy workloads on single-tenant hardware and to use geographically distributed infrastructure, which can be deployed close to the end user for performance and compliance reasons. By purchasing Packet, Equinix can now offer bare metal as a service, which allows its customers to rapidly deploy physical infrastructure at the edge.

“Equinix has been looking at this capability for a while now, and how do we really make the Equinix value proposition around interconnection and infrastructure easier to consume, in a more frictionless way, and in a more software-defined way,” said Jon Lin, president of the Americas at Equinix.

Over the summer, Equinix rolled out its new Network Edge service, and adding Packet bare metal technology will allow customers to deploy isolated hardware in edge locations while also taking advantage of interconnection in their hybrid and multi-cloud environments, Lin added. And it gives them speed.

“Bare metal is such a logical construct that can be the foundation of all of the hybrid cloud work that we’ve been doing on behalf of our customers globally,” he said. “So, when you think about Network Edge and solving for the interconnection use case in a virtualized way, the next logical question is: how do I get servers in that same space directly connected to that Network Edge I set up? And how can I really accelerate this, and start building up a hybrid cloud that’s able to interact with the cloud provider or SaaS provider of my choice — and the enterprise’s own choice of operating system or virtualization stack, etc.? They want to go ahead and be able to get that stood up as quickly as possible.”

Appeal to Service Providers

In addition to appealing to enterprise customers, bringing Packet into the Equinix fold also benefits service providers, Smith said, citing Packet’s work with Sprint. Packet provides the infrastructure for Sprint’s Curiosity IoT platform.

“We’ve got a lot of success in the 5G ecosystem, and helping people with their edge deployments like what we’ve done with Sprint’s Curiosity platform,” he said. “Service providers of all shapes and sizes really have an opportunity to leverage this mutual infrastructure as an accelerant to their own value propositions.”