A battle for control over emerging edge computing applications is heating up as enterprise IT organizations begin to move toward processing and analyzing data as close as possible to where it is being generated and consumed. The latest salvo in that contest is F5 Networks’ approximately $500 million acquisition of Volterra. Volterra provides a platform for managing application deployments on IT platforms. The deal was announced yesterday by F5 Networks.
With Volterra in its stable, F5 Networks will spend the next 12 to 18 months positioning itself as an alternative to proprietary content delivery networks for delivering application code to edge computing platforms, said F5 Networks CEO François Locoh-Donou during a conference call with analysts.
A forthcoming open Edge 2.0 platform from F5 Networks based on the Volterra platform will enable IT organizations to deploy applications to edge computing platforms without becoming locked into a specific content delivery network (CDN). “This transaction is a fundamental change to the game at the edge,” said Locoh-Donou.
At the core of the Volterra service is VoltStack, a distribution of Kubernetes that is curated and managed by Volterra. Developers engage with VoltStack at the edge via Kubernetes application programming interfaces (APIs). Those Kubernetes instances are then integrated using VoltMesh, a service mesh instance Volterra built on top of open source Contrail software-defined networking (SDN) software, now known as Tungsten Fabric.
Volterra’s software-as-a-service (SaaS) platform provides the console that enables IT teams to manage those distributed computing environments.
F5 Networks, however, is not the only IT vendor with similar edge computing ambitions. CDN providers ranging from Akamai, Fastly, and Cloudflare, along with cloud service providers and telecommunications carriers that now offer similar services, seek to dominate edge computing.
The challenge IT organizations face is that cloud computing services and local data centers are simply too far away to process data in near real-time. There’s too much network latency between a zone in the cloud or even a local data center to deliver the level of application experience required by, for example, an augmented or virtual reality application. As a result, service providers are now racing to deploy IT infrastructure in points of presence around the globe to process and analyze data in near real-time.
It’s not clear at what rate organizations are currently pushing application logic out to the edge. F5 Networks expects Volterra to contribute less than $10 million in additional revenue this year, said Locoh-Donou. The bulk of the opportunity that Volterra enables will manifest itself in 2022, he added.
F5 Networks expects to be able to compete aggressively at the edge because the Volterra approach relies primarily on open source software such as Kubernetes running on industry-standard hardware rather than proprietary networking equipment, said Locoh-Donou.
Yesterday, the company also revealed that it estimates revenue for its first quarter fiscal year 2021 financial results will be in the range of $623 million to $626 million thanks in part to an approximately 68% growth in software revenue. F5 Networks also reiterated a commitment to return $1 billion of capital over the next two years, starting with a $500 million accelerated share repurchase in fiscal year 2021.
Each IT organization will evaluate for themselves the best path for pushing application logic out to the edge to enable user experiences in near real-time. The one thing that is certain is that given the amount of compute and networking horsepower being made available, they will have no shortage of options. The return on all that capital investment being made by service providers that clearly need to have deep pockets, however, may not be returned for at least several more years.
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Published at Fri, 08 Jan 2021 20:26:15 +0000