Can Akamai compete with AWS, Google and Microsoft in cloud?

Akamai wants it own slice of the cloud pie. In an attempt to take some marketshare away from the "Big 3" cloud providers, this week, it launched the Akamai Connected Cloud, a massively distributed edge and cloud platform for cloud computing, security and content delivery.

The platform will keep applications and experiences closer and threats farther away, according to the company, which also announced new strategic cloud computing services for developers to build, run and secure high-performance workloads closer to wherever businesses and users connect online.

Aye, Akamai

Remember Akamai? In the 90s, as the web took over the world, system and network administrators realized they had a problem: How to get hot data quickly into the hands of eager users. The answer they came up with was the content delivery network (CDN): Distributed web servers that worked together to provide fast Internet content delivery.

Then CDN company, Akamai Technologies quickly became a leader. Decades later, as cloud and edge computing rose in prominence, Akamai's leadership realized that combining CDNs, edge computing, and the cloud could be a winning idea. Now, we get to see if they're right.

The company took its first major step (leap?) toward the cloud in early 2022 when Akamai announced it was acquiring infrastructure-as-a-service (IaaS) cloud provider Linode for about $900 million.

The goal, as Dr. Tom Leighton, Akamai's CEO, said at the time, was to combine Linode's developer-friendly cloud computing services with Akamai's edge platform and security offering.

According to Leighton, "Linode was an early pioneer in creating the market for alternative clouds." Instead of offering all the bells and whistles of hypercloud providers such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud, Linode offered developers an affordable way to build new applications.

By combining the two businesses, Akamai was beginning a new chapter in its evolution by creating “a unique cloud platform to build, run and secure applications from the cloud to the edge,” said Leighton.

To make the new cloud offering possible, Akamai is immediately adding three new enterprise-scale core cloud computing sites across the U.S. and Europe. Besides these new core sites, the company is also rolling out over 50 distributed sites in various cities around the world this year.

These distributed sites will offer, "a lighter-weight deployment model that is suitable for distribution at a broad scale. This will enable us to get compute much closer to end users around the world." said Leighton.

Sky-high Akamai?

The idea isn't unique to Akamai. It's somewhat like AWS Local Zones, Google Distributed Cloud, and  Microsoft Azure edge modules. The goal is to provide compute infrastructure for applications that demand single-digit millisecond latency and/or local data processing.

Akamai’s new data center infrastructure, besides building on Linode's existing data centers, will also make use of Akamai's 4,100-location-strong edge network. 

To make its offering attractive to customers, Akamai is implementing a new cloud egress pricing structure. This is designed to significantly discount egress rates compared to hyperscalers and alternative cloud providers. Back in the early days of CDN, Akamai used a similar business plan to gain market share from its CDN rivals.

Dave McCarthy, IDC's Research VP of worldwide infrastructure, thinks Akamai might have the right idea with the right stuff at the right time. “Akamai Connected Cloud is unique in that it is designed with a distributed computing mindset. This is in contrast to the major public cloud providers that have been primarily focused on hyperscale datacenters."

True, McCarthy continued, "While Akamai's portfolio of cloud services is much smaller than the major cloud providers, it can win business by offering more flexibility in deployment locations. I expect the company will also be aggressive with pricing."

As for its overall competition, "Up until now," said McCarthy, "Akamai's main competitors have been other CDN providers like Fastly and Cloudflare. With Akamai Connected Cloud, the company has added general-purpose compute, storage, and managed database offerings, making it a credible alternative to AWS, Microsoft, and Google."

Is he right? Will Akamai become a cloud power as well as a major CDN player? Watch this space.