Akamai to pay $1.3 billion for IaaS company Linode

Akamai has decided to add cloud computing to its suite via an agreement to acquire privately-held IaaS provider Linode for $US900 million ($A1.3 billion) in cash.

Already known for content distribution and security services, Akamai will get a suite of IaaS offerings, including compute (with Kubernetes recently added for containerisation), block and object storage, cloud orchestration, and a variety of developer tools.

In its investor presentation, Akamai said the acquisition would address a host of new markets, citing sports, internet of things, e-commerce, the metaverse, and healthcare as examples.

In its press release, Akamai said it expects Linode to bring around US$100 million in new revenue in the first year.

Akamai's COO told the company’s February 15 earnings call the Linode sales model would integrate well with Akamai’s, with no overlap.

“Akamai’s compute products would not only be sold online, but because our current globally located enterprise sales force works closely with the buyers for cloud compute, they have the right relationships, and we would not need to create an overlay sales force,” he said.

Linode has data centres in America (Atlanta, Dallas and Newark), Canada (Toronto), England (London). Germany (Frankfurt). India (Mumbai), Japan (Tokyo) and Singapore.

The acquisition will expand Linode’s reach to pretty much everywhere, since Akamai’s network is present in 135 countries.