Hosting and colocation giant Equinix is sunsetting its bare-metal infrastructure-as-a-service (IaaS) offering by June 2026.
New features will no longer be added to Equinix Metal, as the service was called. Rather, the company is going into maintenance mode until the service discontinues, according to a blog post by Brian Stein, senior vice president of edge infrastructure services at Equinix.
“For current Metal customers under contract, there will be no changes to your service or support over these next months. As your contract ends, we’ll offer a flexible month-to-month option to give you additional time to find an alternative or migrate workloads. And for existing on-demand customers, you can continue using Metal until further notice,” Stein wrote. “We plan to use this tech stack internally, so while we won’t be developing new features for Metal, we will ensure the continued performance, security, and stability of the Metal product until it is sunset.”
Equinix bought into the bare-metal business with the 2020 acquisition of bare-metal specialist Packet for $100 million. It launched Equinix Metal later that year. But the business never caught on, and on the most recent corporate earnings call, CFO Keith Taylor said Metal accounts for just 1.25% of the company’s revenue.
Related: Equinix to cut 3% of staff amidst huge demand for data center infrastructure
Alan Howard, senior analyst for data center infrastructure at Omdia, said that bare-metal is a different business model than what Equinix specialized in, and the income didn’t justify its continued offering.
“[Bare metal] is a much different business model than pure colocation with interconnection. So, at the end of the day, I imagine what likely happened was Equinix started looking at its growth trajectory and [its] margin on these services, then [realized] you know what? It doesn’t really make sense going forward,” he said.
It’s not hard to see why. Equinix was competing with HPE, IBM, Oracle, all of the big hyperscalers like AWS and Google, and dedicated bare-metal providers like Vultr.
MarketsAndMarkets says the bare-metal market will increase from an estimated $8.5 billion in 2023 to $19.1 billion by 2028, growing at a CAGR of 17.4%. For that reason, Howard doesn’t believe it’s a reflection of the market, just that Equinix couldn’t make a go of it. “It just didn’t work for them,” he said.
Source:: Network World